Warren Buffett and George Soros might be two of America’s most famous and successful investors, but Soros seems the less covered in business circles, which is odd, because I find him infinitely complex and interesting (though my knowledge of him at the moment is still scant).
Soros on Soros is a Socratic dialogue with himself in which he details his philosophies on investing, politics, and living life. It’s a good read.
Soros will join Gates, Ford, Carnegie, and others, who will likely be known more for their philanthropy than for their business success. I imagine Soros’ Open Society work will be a more enduring than his breaking the Bank of England. His work in Eastern Europe supporting open societies (that is, a democratically elected government with human rights and a rule of law), for example, or founding Central European University, are achievements that are far more meaningful than the ups and downs of his billionaire wealth (though maybe only possible because of it).
Soros is also famous for being, in his own words, a "failed philosopher". He has a well refined worldview: the concept of fallibility. By fallibility Soros means our own imperfect understanding of the world; the disconnect between how we view the world and how the world actually is; our tendency to cover our blind spots with knowledge, experience, or insight we have gained to areas it does not cover (similar to how we cover blind spots in visual perception by constructing a "periphery"). Soros extends this philosophy to practical issues, such as the imperfections of markets, to abstract constructs such as our inability to at once utilize knowledge (be a participant) and be independent from it — if you participate you cannot be independent; thus, you are acquiring imperfect views due to your own entanglement in the process.
Since I’m not sure even I understand my previous sentence, let’s focus on the simple concept of worldview. Soros says:
Philosophy has deteriorated into an academic profession, but it ought to play a more central role. We cannot live without a set of reasoned beliefs. The question is, can we have a set of beliefs based on the recognition that our beliefs are inherently flawed? I believe we can, and in my own life, I have been guided by my own fallibility.
Yes! We all have a worldview, even if we aren’t always aware of how it animates our actions. As Soros says, a worldview is a set of beliefs — a philosophy, an ideology — that underpins our approach to understanding the world.
When I studied this issue several months ago, I learned a worldview is usually comprised of belief in a higher power (or not), determinism vs. free will, and morality. The most sophisticated worldviews maintain consistency in beliefs — ie you don’t believe in free will and an omnipotent, omnipresent higher power at the same time. However, most of us hold inconsistent beliefs which cohere into a cobbled worldview.
Anyway, wouldn’t it be interesting to line up the worldviews of 50 really successful people and see how they approach life at the meta level? Soros is fallibility, Robert Rubin is "the world is an uncertain place", Nassim Taleb is "randomness reigns supreme", and so forth. Who else enthusiastically presents a life philosophy? Do you have one?
For better or worse, I get the impression that Soros tries too hard to be known as something more than a great money manager.
For example, is Soros’ concept of fallibility any better or more interesting that Warren Buffett’s strategy of investing in great numbers-oriented managers who are passionate about their business? The implicit worldview that Buffett has is that people are motivated by something beyond money (since his investments generally make those managers independently wealthy), and that if you free them from outside constraints, they will seek to make their businesses the best they can be.
I don’t know about you, but a guy who runs around using big words and trying to leverage his core strengths into non-core areas isn’t necessarily more interesting.
In basketball, we often talk about players who play within themselves, who understand who they are, and what they excel at, and stick to it.
Perhaps Soros seems more like a Ron Artest, a brilliant defender who wants to be a scorer, rather than a Buffett or Tim Duncan, who methodically sticks to what he’s best at.
Chris —
I think you’re drastically undervaluing Soros’ *actions* by saying “running around using big words”. He has poured millions and millions of dollars in a wide range of philanthropic efforts all united by his belief in “fallibility” and open society. The stuff he does is interesting, and it’s automatically interesting because he walks the walk (Larry Ellison, on the other hand, talks about his charity, but doesn’t do shit.)
Shouldn’t we be glad that Soros wants to be known as something more than a great money manager? Would you want to be known as someone more than a marketing person? When you leverage your strengths into non-core areas, you might fail, but at least you’re contributing to the historical record that others can learn from. In 20 years I’m sure many will look back and study Soros’ work in eastern Europe and attempt to learn from his successes and failures at reforming societies. (He has had many successes, by the way.)
When you compare Buffett and Soros, Buffett undeniably has the better reputation. But how could he not? He has not put himself out there like Soros. Instead he enjoys his life in Omaha, writes love letters to shareholders once a year, and brilliantly invests and makes money. Nothing wrong with this — in fact, much to celebrate! — but it doesn’t make him very interesting outside of business, at least to me.
On a somewhat separate note, I’ve never liked Buffett’s approach to philanthropy. The way I understand it, his theory is if he waits to donate his money when he’s 80 years old it will have grown in value because of compound interest, and thus it’s better to wait than to disburse now. This assumes that what philanthropy needs is more money. If we look at all the failed charity projects over the years, nothing could be farther from the case. What philanthropy needs are world-class minds — not leftovers from people who couldn’t make it in business. Buffett, unlike Gates, has opted out of intellectually engaging in the issues of the day. He has now checked the charity box by giving all his money to his buddies at the Gates Foundation, but even that makes me queasy — do we really want the lion’s share of charity money being controlled by a single foundation?
Thoughts?
Ben,
I think there is a lot about Soros that should be admired. He is clearly a very intelligent and passionate guy, and more importantly, he has been willing to deploy his fortune to back projects that he’s passionate about. Moreover, his role as a hedge fund manager has, in my opinion, done a lot of good for th world. Market inefficiences need to be eliminated. My comment was not meant as a slam on Soros.
What I did want to convey was the fact that I think we are too likely to ascribe intellectual depth to outspoken celebrities of any stripe. I may admire Paul Hewson (Bono of U2) for his tireless use of his celebrity as a bully pulpit for various policies, but that doesn’t mean I think we should go ahead and award him a Nobel Prize as some have suggested.
Ultimately, I believe in choice, and I believe that Soros has the right to choose what he does with his fame and fortune. I think that he’s done a lot of good with it. I also think that it’s unclear that he’s pursued the optimal course.