George Soros and Neoliberalism - Taking on Europe's Populist Resurgence

The recent populist "gilets jaunes" movement in France and the 2016 British referendum on Brexit are just the tip of the iceberg when it comes to what lies ahead for Europe.  As you will see in this posting, there is one gentleman who thought that he had the ultimate solution to what ailed Europe. I would like to apologize in advance for the length of this posting, however, to help put everything into context, it is important that you understand the background behind the key player and his comments.

Let's start by looking at the classic and very basic definition of populism as proposed by political scientist Cas Muddle:

"Populism is a thin-centred ideology that divides society into two homogeneous and antagonistic groups: “the pure people” on the one side and “the corrupt elite” on the other."

Cas Muddle notes that there is no single definition of populism that will describe all populists and that populism is not about being rich or poor, rather, it is cultural as shown in this quote about Donald Trump:

"His connection to the people is actually cultural, not through money—it is through eating at McDonald’s and putting ketchup on your steak and not being interested in high culture. That is how he says, “I am one of you”. Sure, I am way richer than you, but that’s irrelevant, because populism is not about money, it is about values." (my bold)

According to the Guardian, the populist movement in Europe has been consistently on the rise; in 1998, populist political parties were a marginal force that accounted for only 7 percent of votes cast across Europe.  In 2018, 27 percent of votes were cast for populist parties in the last parliamentary election with far-right populists accounting for 14 percent of votes, far-left populists accounting for 6 percent of votes and other populists accounting for 7 percent of votes.  A prime European example of populism is found in the wake of the Brexit vote.  As you well know, the populist movement in the United States is largely what resulted in the Trump victory over Hillary Clinton in 2016 as tens of millions of voters have grown increasingly disgusted with business as usual in Washington.

This posting requires additional background to help you put everything into its proper context.  Since the main subject of this posting is George Soros, let's look at some background on one of the world's most wealthy individuals.  For those of you that are not aware, according to Forbes, Mr. Soros is the 60th richest man in the world with a net worth of $8.3 billion as shown here:

According to Bloomberg, here is what has happened to his wealth since 2012:

It is important to note that Mr. Soros donated $18 billion to fund his Open Society Foundation in October 2017, a donation that accounts for the drop in his net worth.

Mr. Soros is very politically involved as you can see here:

...here:

...and here:

In the 2016 presidential election cycle, Soros Fund Management donated $10,556,793 to Hillary Clinton's campaign, making it Hillary Clinton's sixth largest contributor.

With all of that as background, let's look at a July 2016commentary entitled "This is Europe's Last Chance to Fix Its Refugee Policy" by George Soros on the situation in Europe and its ongoing struggle with immigration.  Here is the opening:

"The refugee crisis was already leading to the slow disintegration of the European Union. Then, on June 23, it contributed to an even greater calamity — Brexit. Both of these crises have reinforced xenophobic, nationalist movements across the continent. They will try to win a series of key votes in the coming year — including national elections in France, the Netherlands, and Germany in 2017, a referendum in Hungary on EU refugee policy on Oct. 2, a rerun of the Austrian presidential election on the same day, and a constitutional referendum in Italy in October or November of this year.

Rather than uniting to resist this threat, EU member states have become increasingly unwilling to cooperate with one another. They pursue self-serving, discordant migration policies, often to the detriment of their neighbors…

This is unfortunate, because a comprehensive policy ought to remain the highest priority for European leaders; the union cannot survive without it. The refugee crisis is not a one-off event; it augurs a period of higher migration pressures for the foreseeable future, due to a variety of causes including demographic and economic imbalances between Europe and Africa, unending conflicts in the broader region, and climate change."

So, what is Mr. Soros solution?  

"First, the EU and the rest of the world must take in a substantial number of refugees directly from front-line countries in a secure and orderly manner, which would be far more acceptable to the public than the current disorder. If the EU made a commitment to admit even just 300,000 refugees each year, and if that commitment were matched by countries elsewhere in the world, most genuine asylum-seekers would calculate that their odds of reaching their destination are good enough for them not to seek to reach Europe illegally, since that would disqualify them from being legally admitted. If, on top of this, conditions in front-line countries improved thanks to greater aid, there would be no refugee crisis. But the problem of economic migrants would remain." (my bold)

Obviously, there is a substantial cost to this solution.

"At least 30 billion euros a year will be needed for the EU to carry out a comprehensive asylum plan. These funds are needed both inside the union — to build effective border and asylum agencies and ensure dignified reception conditions, fair asylum procedures, and opportunities for integration — as well as outside its borders — to support refugee-hosting countries and spur job creation throughout Africa and the Middle East. Robust border and asylum agencies alone could cost on the order of 15 billion euros." (my bold)

Mr. Soros solution to raising the necessary funds is through what he calls "surge funding" which "...entails raising a substantial amount of debt backed by the EU’s relatively small budget, rather than scraping together insufficient funds year after year...".  He notes that Europe should have no problem raising its debt level since it already has a "remarkably low amount of debt given its budget".

Here is a map from Eurostat showing the gross debt-to -GDP for all European nations:

As you can see, debt-to-GDP ranges from a low of 8.3 percent for Estonia to a high of 179.7 percent for Greece.  In the second quarter of 2018, the Euro19 had a debt-to GDP of 86.3 percent and the Euro28 had a debt-to-GDP of 81 percent.  One would have to wonder exactly what Mr. Soros terms as high debt given that he feels that a debt-to-GDP in excess of 80 percent is "remarkably low".

Here is Mr. Soros ultimate solution to fixing Europe and the funding of his proposed asylum plan:

"To finance it (the comprehensive asylum plan), new European taxes will have to be levied sooner or later."

And, there's the problem.  The situation in France is proving that Mr. Soros "simple solution" of raising taxes is not so simple after all.  The gilets jaunes movement began as a protest against the government tax reforms which disproportionately burdened lower and middle income classes in addition to the increase in fuel taxes.  Raising money through higher taxes may seem like a simple solution to Mr. Soros, however, millions of voters across Europe would strongly suggest otherwise.

Let's close with this photo:

That's Canada's photogenic Prime Minister Justin Trudeau benefitting from George Soros views on the world at the Davos meeting in 2020.  What this tweet didn't show was the other person in attendance at the meeting of the minds, Canada's foreign minister and Soros acolyte, Chrystia Freeland who posted this photo of the meeting on her parliamentary website:

Given that Justin Trudeau stated this shortly after he took office in October 2015:

‘‘There is no core identity, no mainstream in Canada.  There are shared values — openness, respect, compassion, willingness to work hard, to be there for each other, to search for equality and justice. Those qualities are what make us the first postnational state.’’

...I think that it's pretty certain what direction Canada will be heading in should Justin Trudeau win the next federal election.  Welcome to the Europe of North America.