George Soros, a Hungarian-born American billionaire investor who supports progressive and liberal political causes and is credited with influencing the collapse of communism in Eastern Europe in ’80s, has become a punching bag for Communist China.
In an Aug. 30 op-ed published in the Financial Times, Soros said that Chinese President Xi Jinping’s crackdown on private enterprise is “a significant drag on the Chinese economy” and “could lead to a crash.”
Soros is the chairman and founder of Soros Fund Management and the Open Society Foundations. He has donated more than $32 billion to the Open Society Foundations as of March 2021, earning him Forbes’ designation as “most generous giver.” Soros has a net worth of $8.6 billion.
An advocate of “open societies,” Soros financially supported dissidents of communist governments in Poland, Czechoslovakia and the Soviet Union starting in 1979. “(Soros) has undertaken … nothing less than to open up the once-closed communist societies of Eastern Europe to a free flow of ideas and scientific knowledge from the outside world,” said Waldemar A. Nielsen, an authority on U.S. philanthropy.
Chinese government-controlled newspaper Global responded on Sept. 4 to Soros’s op-ed with an ad-hominem attack, describing Soros as a “global economic terrorist,” “the most evil person in the world” and “the son of Satan.” The attack was seen by some as part of the growing tensions in US-China relations, the Standard and Asia Times reported.
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The poster child for reforming global capitalism, Soros was born in Budapest and survived the Nazi occupation of Hungary. He moved to the U.K. in 1947, studied at the London School of Economics and worked at merchant banks in the U.K. and U.S. before starting his first hedge fund, Double Eagle, in 1969. Later renamed Quantum Fund, its profits seeded Soros Fund Management, his second hedge fund, in 1970.
Soros became known as “The Man Who Broke the Bank of England” after his short sale of $10 billion worth of pounds sterling earned him a $1 billion profit during the 1992 Black Wednesday U.K. currency crisis. Soros formulated the General Theory of Reflexivity for capital markets, which he says provides a clear picture of asset bubbles and fundamental market value of securities, as well as value discrepancies used for shorting and swapping stocks.
Here are three things to know about China’s beef with George Soros.
Soros spent much of his life donating to anti-communist groups in Eastern Europe, according to a 2010 Foreign Policy report. He has expressed concern about the Communist Party of China’s growing economic and political power while the U.S. government struggles with gridlock, saying, “China has not only a more vigorous economy but actually a better functioning government than the U.S.”
In January 2016, China warned Soros against betting that the value of the Chinese yuan and Hong Kong dollar would fall, saying “Soros’ challenge to the RMB and Hong Kong dollar are doomed to fail, without any doubt.”
In 2019, Soros called Chinese President Xi Jinping the “most dangerous opponent of open societies”, saying: “China is not the only authoritarian regime in the world but it is the wealthiest, strongest and technologically most advanced”. Soros asked the U.S. to stop Chinese technology companies Huawei and ZTE from dominating the 5G telecommunications market, saying it would present an “unacceptable security risk for the rest of the world”. Soros also criticized China’s mass surveillance system — the Social Credit System — saying it would give Xi, “total control” over the people of China.”
Soros has criticized the world’s largest money manager, BlackRock, for raising $1 billion for a mutual fund for Chinese individuals, the first and only foreign firm allowed to do so in the country. China welcomes foreign capital, even as it cracks down on Chinese capitalists. China’s growing middle class is an untapped market for foreign investment-management firms, Wall Street Journal reported.
Soros wrote a Sept. 6 opinion piece in The Wall Street Journal calling BlackRock’s investment in China a blunder. Pouring billions of dollars into China would likely lose money for its clients and damage the national-security interests of the U.S. and other democracies, he said. “More important (it) will damage the national security interests of the U.S. and other democracies.”
Soros wrote that BlackRock’s ESG Aware Index has “effectively forced hundreds of billions of dollars belonging to US investors into Chinese companies whose corporate governance does not meet the required standard — power and accountability is now exercised by one man (Xi) who is not accountable to any international authority.”
The Global Times’ commentary, titled “This global economic terrorist is staring at China!”, claimed that Soros only started to criticize China because he regretted divesting of shares in Tencent Music, Baidu and Vipshop earlier in 2021.
In the Global Times article, the Chinese government accused Soros’ Open Society Foundations of financing Human Rights Watch, a New York City-based non-governmental organization that advocates for human rights. China claims Human Rights Watch spread rumors about China, the origin of the covid-19 pandemic and pro-Democracy protests in Hong Kong. The Chinese government mouthpiece also claimed Soros colluded with Jimmy Lai, the founder of Hong Kong media Company Apple Daily, to try and start a “color revolution” in Hong Kong in 2019.
China describes protests as “color revolutions,” blaming its internal dissent on the U.S. and other Western powers that it accuses of threatening its public and national security.
Apple Daily has criticized the Chinese government for decades. The media company and its publisher, Next Digital, had their company accounts frozen in June. In September, they announced that Apple Daily would be shutting down after an official crackdown left it with no way to operate, New York Times reported.