The Age of Fallibility: Consequence of the War on Terror | George Soros | Talks at Google

Good afternoon. Good afternoon, everyone. Welcome to 900 Alta. For those of you who have not been here, we're pleased to host this in this building. So I think people know we have the Authors at Google series, and we've attracted a lot of fantastic authors over the last six to eight months when.

We'Ve been doing this, and I think.

None as spectacular as this one. Mr. Soros, the author of eight books, is here to talk about his latest book. Now, because of the prominence and interest in this author, we're doing a bit of an unusual authors at Google, where we have our CEO who needs no introduction, Eric Schmidt, who is here to interview. And so a new format. I'm pleased to introduce Mr. Eric Schmidt and Mr. George Soros. Well, thank you all. Thank you all for being here, and thanks to George for. For coming. You know this. My view of Mr. Soros is that he is one of the most important people in the world today in terms of the impact that he's had. He grew up in Eastern Europe, where his. In my reading of your background, your understanding of the world was much shaped by what you saw by the Nazis and by socialism and the fascism of the time. But because he's a clever guy, he eventually escaped and went to London where he became quite the financial wizard. And for a few decades, George managed to invent a whole new industry, which we generally know now as financial derivatives, currency trading, and things like that. My first meeting with you was actually at the World economic forum about 10 years ago, and I happened to go from there to Malaysia, where I happened to meet with the Prime Minister of Malaysia, who spent a great deal of time complaining about you. And I thought, wow, a dictator really hates George Soros. Pretty interesting. So a few years later, we had dinner and I asked George, what kind of an impact can you have on the world? And I didn't quite understand because I was, I guess, stupid or something, how much impact he'd already had in history. As it is fully understood. People will understand that the financial support and the structural support that he and his organization, in their first attempts at philanthropy, helped the Polish Solidarity movement, freedom movements in Hungary. And in fact, in our conversation a few years ago, third or fourth conversation, he described to me his objective, which was to help use the resources that he had accumulated in his life to promote open society, open discussion. And I said, how do you do that? And he said, let's go and fund intellectuals, let's fund universities, let's fund smart people, and they'll take care of everything else. And indeed, he replicated that model around the world. So in more recent times, George has started to work on what he sees as the role of the United States, the U.S. presidency and the political climate, not just in the United States, but about terrorism, which has resulted in this remarkable new book, the Age of Infallibility. The age of Fallibility. Excuse me. Infallibility is the other side, I guess. So I guess with that we should say welcome to Google. Thank you.

Thank you. I have to correct. It's a very nice introduction and I appreciate it. I think that my role in the financial markets you've exaggerated because I did not invent hedge funds and I know really quite not enough about derivatives and so on.

Since four of the smartest and top people who manage that entire industry were hired, nurtured and promoted by you. I think you're. Your credit is due. But in any case, congratulations on your tremendous success. Let me ask you a topic that's bothering me to get us started and let me observe what I read in the press today. In Iraq, there are a lot of evidence that there's an emerging civil war. It's been relatively well established that the original justification for the invasion of Iraq was. Was not supported by the evidence. We now have a very, very difficult ongoing battle between Lebanon and a set of people who are generally agreed to as terrorists and Israel. And there's a great debate as to the tactics there. How did we get here? What did we do wrong and what caused all of this?

Well, it's a very good question because the situation really is very serious and deteriorating at a rather fast pace. And what started out as a false metaphor, the war on terror, which was an expression applied to an abstraction.

Has.

Actually had this unintended, I think largely unintended adverse consequence of actually becoming now a real war. And the United States that was at the time the most powerful nation on earth, it still is in a way, but it's dominated the world's agenda and set the agenda for the world that the rest of the world had to respond to in response to 9, 11 declared war on terror and that set the agenda for the world. And now we have a real war. So it's amazing how I mean this in a way. It's a backward way of getting into my book. In the book I start with a philosophy, a conceptual framework where explain the relationship between our thinking and the reality in which we participate. And I argue that because we are both observers and participants at the same time, our understanding is imperfect, but our biased, distorted understanding actually shapes reality. And this is really an amazing example of how a false perception can actually shape reality. And we now have a really serious war on our hand.

Now, in your past work in the last few years, you spent a great deal of your time and money essentially trying to promote politicians other than President Bush and many of the other sort of people who are opposed to the current policies. You donated a great deal of money at one point to certain set of political action committees and so forth. So not only have you taken a position, but you put your money where your mouth was. And you've also drawn quite a bit of very, very vitriolic criticism for all of that in the United States. Why have you decided that President Bush and the current administration, in your words, is so terrible?

Well, you know, when I had made more money than was good for me, I decided what it is that I really care about. And I set up a foundation to promote open society throughout the world. And I got very much involved in various countries, particularly in the former Soviet empire. And there I was standing up for principles of open society. And then, to my greatest amazement, I found that open society, as I understand it, is endangered in the United States. And so I felt obliged, having sort of backed a lot of people who stuck their neck out and really took very serious risks to actually also to stand up and to stick my neck out, not taking anything like the risk that they had taken in their countries. So that's really what got me so involved in domestic politics. And I felt that as a citizen of the United States, somebody who has chosen this country as his home, and seeing that the country is moving in the wrong direction, I felt that I have got to get involved in America. And that's at the time I felt that if we could terminate President Bush's hold on the White House, that we could short circuit what I think is a kind of a bubble. I called it in my previous book, I called it the bubble of American supremacy, a false idea, but which nevertheless becomes part of reality. And I'm afraid that it would have been a wonderful thing to short circuit it. But now we have the consequences, and it really is, I think, certainly Israel is now endangered in its existence, and I think our dominant position in the world has diminished to a much greater extent than I expected at the time when I wrote the Bubble of American Supremacy.

Now, in this new book, the message is about how ideas create a misperception that then creates a bad outcome. But I suspect most of the people in the audience and watching while they're unhappy really want to know what are some solutions.

But Before, I just want to interject that it doesn't always work that way, that actually ideas can also have very good outcomes. Actually, I think probably in some ways, Google is an example of a company that has had an idea and it has really taken off. So if not everything turns sour, some things actually have a positive outcome.

But one of the powers of information, which of course is what Google is providing, promoting, is that misinformation, especially if it's done selectively, can be misused. And that's always a great danger with more and more information.

Well, the problem is, you see that you can't really base your decisions on information alone, because you are making decisions which have to do with the future. You want to accomplish something and what the result will be. That is not information. That's conjecture. And so you have to sort of bring some kind of perspective on the world to make those decisions. And that's where you have to introduce some judgment and bias. And that's not information and it's not knowledge. So the idea that you can sort of base decisions on knowledge, that was, in a way, the idea that was prevalent in the Enlightenment, and that was a fertile fallacy. So the opposite of a false metaphor is a fertile fallacy, and the Enlightenment was a fertile fallacy. But now we have discovered, I think, after having had 200 years of enlightenment, that it isn't as we imagined it at the time, that there is the intellect and there is reality, and the two are separate, and you bring the intellect to bear on reality. You acquire knowledge and you can base your decisions on that knowledge. It doesn't work that way because we are part of reality and our understanding is imperfect. We bring a bias and that becomes part of reality. So reality is much more complicated than that idea.

Well, and there's also large cultural components for the understanding of information, symbolism, the role of religions and so forth, which I have all of that I'd like, given that most of our audience have received a copy of the book but have not had a chance to read it in the last few minutes. As quick as people are here.

Talk.

A little bit about what the conclusions or what the key points. Why did you write this book? What's so special about the Age of Fallibility?

Let's say two points. One, that this I want to bring home. The idea that the war on terror is a terrible, mistaken, false metaphor that brings terrible results. That's a difficult point to get across because everybody now knows that the invasion of Iraq was a terrible mistake. But people still think on both sides of the political spectrum in terms of the war on terror. And I would like to undermine or repudiate that metaphor. So that's one part of. And the other one is, what is America's role in the world? What should be America's role? How has America got to be different to regain the position that it is currently in the process of losing? And I argue that if you want to be the leader of the world, then you have a special responsibility to be concerned with the welfare of the world. Not only, let's say, your own constituents, the rest of the world doesn't have a vote in Congress. Nevertheless, American leadership would have to be concerned about issues of common concern for humanity. And we've got several of them on which are continued prosperity and existence depend. Like take climate change. We really got to do something about that. And unless America takes the leadership, we will not be able to get the common action. And here, for instance, the administration is lagging behind the public. The public is now aware of it. The administration is in denial. Nuclear, non proliferation. It's a much bigger threat now than it was in the Cold War, because then there were only basically two players. Now you've got many players. So that's another issue. Then what do you do about tyrants like Saddam Hussein? The way we went about it was the wrong way, but the world has a number of these tyrants around and we do need to do something about it. And it does need some legitimacy, some international cooperation to deal with the likes of Saddam. So just three examples. How many more?

Let's go back to your first point, which is the false metaphor or the poor impact of the term war on terror. It is not in question that the United States was attacked by Al Qaeda, that more than 3,000 innocent people were killed in a terrible terrorist attack which affected the country and all of us in a very, very Sad Way on September 11th. So you're not questioning that? No. It is a war, isn't it?

No, no, it isn't. And it ought not to be, because war by its very nature creates innocent victims. There's no way to wage war without creating innocent victims. Now, if you wage war against an unknown hidden enemy like terrorists, the danger of hitting the wrong people is that much greater. And then when you wage war on an abstraction like terror, well, there is no. There's a multitude of sins that you can commit under that rubric. And so war taken literally is the wrong way to fight terrorism.

So what's the answer to that part of your point? If it's not a war, but we are threatened. What's the answer?

You have to defend yourself against terrorism. You've also got to take into account what actually is behind that terrorist. In other words, don't put all manifestations of a certain kind under one rubric, one abstraction. Terrorists. You now have, you know, Al Qaeda, you have Hezbollah, you've got Hamas, and you have got the insurrection in Iraq.

Now.

Hamas was brought into existence by the occupation of Palestine by Israel. Hezbollah in Lebanon was brought into existence by the Israeli occupation of, of southern Lebanon. The Iraqi insurrection was brought into existence by our occupation of Iraq. So, you know, if you just sort of declare war on terror, you actually may create a lot of terrorists in the process of hitting innocent victims, because that is in fact what brings on terrorism. Now that's not to excuse Al Qaeda. I mean, there's no, I can't see any justification for it.

So.

But you can't just sort of separate yourself from the consequences of your actions and say, well, terrorists, you have to wage war on terror. And you can. Anybody who can be possibly accused of being in that category or any, anybody who happens to be standing in the way, you can do whatever you like. So this is, this false metaphor separates us from them. You see, we are the victims, they are the perpetrators. And so we can hit them, but who are they? And then we hit the wrong people and they see us in the same light as we see them. So this is where this incredible difference in perceptions has arisen, where America today is seen as a threat in the rest of the world.

Well, I'm sure that the pictures in the Arab world of the innocent people being killed are not helping the sides on either side and are certainly inflaming local, local population. Another point that you make here, and you've made before, is that America, because we have been the sole superpower, has a distinctly different responsibility, a higher responsibility. And you've used those worries in one way or the other. Can you explain that? What is it that we should do differently or why is the standard different for us as opposed to another country?

Well, the current world order is based on sovereign states and there are many of them. And they all promote their self interest, that they're guided by their interest, and so are we, and so we should be. But there are common interests that we have, like maintaining peace, etc. And you need some leadership. Somebody has to lead for collective action, and that is the role of the leader. We emerged as the sole superpower. Before that, you had two superpowers and they were sort of in some kind of balance with each other. Actually, it was a mad balance, mutually assured destruction. That was the basis of the world order, right? That world order has dissolved. We were left as the sole superpower, and therefore it's our responsibility to lead those initiatives to strengthen international organizations and strengthen international law. Now, the American supremacists or neocons say international law doesn't really exist, It's a matter of power. And of course, they are right. But international law ought to exist. And if you say it doesn't exist and you disregard it, you actually destroy it. What we ought to be doing, we ought to be strengthening it. Now, this idea of international cooperation has a terrible reputation in the United States, which is the result of a concerted sort of educational project by the right wing. And that has to be radically revised. Because if we want to be leaders, then we actually have to lead and accept that we are dealing with a world of sovereign power. So they won't always do what we want them to do. And we have to build consensus, and we will never quite reach anything approaching perfection. So the United nations is a very limited kind of international organization because it's an association of sovereign states, very difficult to forge consensus. There are five powers that have veto power, so we can't just sort of have it our way. But nevertheless, it's in that framework that we have to work.

So what I'd like to do is ask one final question while we get organized. For some people, ask questions from the audience because it's always more interesting than the questions I might ask. I'm still frustrated by not knowing the answer of what we should do. But do you have off the top of your head, what would you do in Iraq? What would you do in Lebanon? What would you do about all the treaties that we're either adhering to or not adhering to? You're obviously not supporting the current political climate and the current president, but the voters will have an opportunity to discuss that at the appropriate election time. What would you do now if you were president and you were in charge of foreign policy or the Congress, and you were unilaterally in charge of foreign policy for a day?

It's a very, very good question. Very difficult question, because you are, you know, in a process that is you're far advanced in it, and you can't just sort of make it disappear. So you can't actually, for instance, pull out.

So you can't just pull. Can't pull everybody out of Iraq right now, is what you're saying.

I don't think you can Do I mean, we have to get out of Iraq, but we have to get out in an orderly manner and try not to leave behind a very large scale civil war, because we are currently in that process.

So just to test this, imagine a situation where the civil war terribly gets worse. American lives are at risk and we face this very difficult choice of do we keep our Americans in or do we withdraw? How would you make that decision?

No, I think we have to be determined that we have got to get out. We get out either in an orderly manner or the way we did in Vietnam with the, you know, the helicopters picking you off the green, out of the green zone. It's much preferable to get out in an orderly manner, leave something behind that is relatively stable. How could you get there? And I've given this quite a bit of thought and it's clear that it would have to be some kind of an arrangement that the various factions agree on the distribution of oil revenues. That's the key because that's the main source of the Iraqi state. And actually you have to create conditions where you generate new revenues, in other words, where you can have an auction bringing in oil companies for new concessions. For that you have to establish a legal basis for the oil concessions. And that has to be the objective of any kind of an agreement that would leave something behind because that would be a not a zero sum game of fighting over the existing revenues, but a positive sum game because you would be generating new revenues. Now any kind of agreement would require international enforcement in a way to guarantee it. So there would have to be some kind of an international presence. And probably that international presence would have to have a large American component because others are not willing to go in there. But that would have to be under an international authority. So that would mean that the United States would have to be willing to, to submit itself to such an authority. And that is the decision that would face the administration. Is it willing to do that? I think the current attitudes would not permit that. That would be 180° about turn and that is what you need.

Let's start with some questions from the audience. We have some microphones. We have one right here. And again, remember that you're live and on broadcast.

Many Western European nations in recent decades have faced and managed to defeat essentially very strong terrorist movements with a variety.

Of.

Different reasons for existing. From the Red Brigades in Italy, to Irae in Britain, to the Basque terrorism in Spain. What metaphor could best describe the way these bloody terrorism movement have been defeated? Maybe police action, maybe a re education Maybe a removal of motivation by sharing power in Northern Ireland. Isn't it terrible that it seems that the United States isn't looking at this recent experience in very similar nations to inform its metaphors and its perception and its dealing with the terrorists it's been facing? Yeah, I think you make a very good point that there have been a number of terrorist movements and they don't necessarily have the same motivation. They have different motivations, different contexts, and therefore putting them all together is a distortion. It's an abstraction.

So I have two questions and they're not related to terrorism or your book, but it's sort of related to your early career as a financial trader. So my father, who's in Hong Kong, read all your books on reflexivity and he tried all your techniques on stock market and it just didn't work out for him. Well, at least you're telling the truth. So I'm just wondering sort of if you have, if you want to be able to flip a coin like a hundred times and you have to get heads all the time, all you need is 2 to the 100th coins, right? I mean, expect, you know. So do you see yourself like your investment philosophy as something like, do you have this, like, what's your secret sauce? Like, do you have this principle that you hold onto over time that has helped you profit or is it more of a luck thing? That's my first question. Second question is regarding long term capital management. So you know how the Nobel Prize laureates have failed in that particular incident when Russia defaulted on their sovereign bond. So I was wondering whether you have any insights on quantitative based trading methods actually have in the future?

Well, the secret of my success actually I can now tell you.

Okay, hold on.

Since you asked me, I'm always wrong. I'm always wrong and I try to correct my mistakes. That's the secret of my success as far as the quants are concerned. I mean, they're very successful models, but they all have a flaw in the end. And eventually if you persist, then the flaw becomes apparent. So capital management did extremely well at very high leverage for a very long time. And there was that thick tail that occasionally you slip up. What is the appropriate method for a thick tail? I don't know what happens to it. You step on it. So you step on the thick tail and you are in trouble.

Thank you. I have a question about the war on terror and the terminology because I think on both sides of the political debate there's pretty much agreement that it's kind of an idiotic phrase, mainly because waging a war on terror is kind of like waging a war on planes or tanks or missiles. You don't care about the tool. You care about what's behind. Behind the tool that's controlling it. My understanding, a lot of people say that this was a result of the Bush administration's trying to be politically correct and not to name the real enemy, which was actually an ideology, a militant Muslim ideology, much like the Cold War was a war against the communist ideology. If they replaced the words, the word terror with militant Islam, would your opinions change whether or not the war is a. Or would you still think that it's. That we're trying to fight something fuzzy?

You see, I disagree a little bit with your question, because basically the war on terror came about because the Bush administration decided to exploit the very real fear that people felt as a result of that attack. The fear was very real. But instead of doing what President Roosevelt did and say, you have nothing to fear but fear itself, the Bush administration went out of its way to exaggerate the threat. So the next time it was going to be in the form of a mushroom cloud. It wasn't enough that 3,000 people died and the towers collapsed. Next time it's going to be an atomic. So it was an exploitation of fear to mobilize public support behind a president who is commander in chief, and you have to salute and accept his orders instead of criticizing him. Criticizing him is unpatriotic, and that undermines the very principle of an open society which is based on critical thinking.

Your old friend Jim Rogers has argued that countries of people that don't want to be together should be allowed to fall apart, like Yugoslavia or ussr. Do you think that's true with Iraq? That we should just let the Kurds secede and the Sunnis and the Shiites separate? And second, have you had a falling out with Jim?

And what?

Did you have a falling out with Mr. Rogers?

Well, that's a private matter. It concerns others. But Iraq, that is a public matter. And I think Iraq is falling apart because the factions are all pulling apart. But I think if you want to avoid a civil war similar to what happened in Bosnia, you've got to hold Iraq together because of the oil revenues. See, Iraq is based on oil. It's Bosnia with oil. So you can't actually divide it because the Sunnis then have absolutely no oil on their territory, and they would have to fight for oil.

Let me suggest, by the way, you're talking about a very difficult scenario for people who are of different Religions and have not historically cohabited should, shall we say, are forced to agree. In the history of Iraq, Saddam Hussein, a terrible dictator, did force them into what was essentially a secular country run by the only religion was himself. This is a big burden on a society to change into something different.

No, it is, and it's actually a long shot. It's the less likely outcome. The more likely outcome is that the civil war which is already occurring, forces people into separate. They have to pull apart. The killing occurs where the lines are not properly drawn. So there, there is a breaking up of Iraq and if we just simply pull out, then what is now 100 deaths a day would for a while become tenfold or much bigger.

This question might seem a bit premature considering all the problems that we're facing now. But, but in the past you focused on promoting an open society outside the United States, especially in the developing world. Today you're focused on promoting that within the United States to an extent, and dealing with the issues of terrorism, et cetera. What do you think the problems that are going to be facing society will be in, I don't know, five to ten years from now. And would you see yourself focusing the effort of your foundations on in the future?

Well, first of all, while you hear about my involvement in the United States, the Foundation is still working and I am still deeply involved in what goes on in the rest of the world. So that hasn't changed. And we are engaged in promoting open society everywhere. And that I don't see that as changing. And I think it will continue after me. I now think that there is a role for the continued existence of the foundation because I think civil society has to be active in holding governments accountable. And it needs support for that. And this support is difficult to obtain because philanthropists don't like to meddle in political arena. People, you know, happy to work on health and so on, but, you know, supporting civil society, there aren't many. And that I see as a continuing role for the foundation throughout the world. I came to this insight in South Africa, which has one dominant party, would be able to change the constitution. And yet South Africa is a functioning open society. And that's because it has an independent judiciary and it has an active civil society that holds the government accountable. And so South Africa is a flourishing open society, even though it doesn't really have a parliamentary opposition. So that is a role for civil society. That's what my foundation there is engaged in. And I think it's something that needs to continue indefinitely.

Thank you. I'm Afraid. I have dozens of questions for you, but I guess my biggest one is how do you see the trend to narrow casting? Narrow casting? Narrow casting, serving small networks of people with specialized information.

Obviously I don't know anything about it.

Well, no, you do. Well, we have, because we have an administration that was elected because there were enough people who believed a certain line that it was close enough to be stolen or close enough to win, whichever you want to. But the fact that it was even close is amazing to me. And the idea of narrow casting, that if you control two sources of news and opinion, namely Fox News and evangelical ministers, and this is the way of disseminating opinion to half the country, it seems like things like the Bush administration will not merely be an outlier, but will become the norm and they'll be just the way things are.

Well, I mean, this is one of the real puzzles that I'm addressing in the book, but I can't say that I sort of have anything like the definitive answer is in the book or altogether. And that is how come that you have independent and pluralistic media. Nevertheless, you have conditions very similar to 1984, you know, where there was a Ministry of Truth that controlled the information. So how come, how could the same kind of distortion of truth be perpetrated with pluralistic media? And one of the answers is that people don't care about the truth that much. I mean, people in America care about success and it doesn't matter how you get there. So this pursuit of truth, which, you know, has a long tradition, enlightenment and so on, is at the moment, I think, in trouble. So that's the public. In other words, you can blame the leadership, but you also have to blame the followership. So that's part of the answer, but it's not the only one. And obviously there is the concentration of the media, the concentration of the ownership. But then you have got Internet and the new media, which ought to some extent countermanded. And you do have a right wing propaganda machine that acts by basically constant repetition of a distorted point of view. And I'm just. Currently, you've seen this movie before.

You've seen this movie before, you survived this movie.

And you know, that's what led me to say that I'm reminded of the Nazi regime. And I got into a lot of trouble for saying that, but I'm currently trying to understand in what way the, the propaganda is similar to what was used there. And I'm just sort of beginning to identify some of the tricks that are being used. And I'll probably write about it in the next few weeks.

Hi there. I really share your view that the best way for us to spread democracy is not by invasion, but by strengthening international bodies and by supporting grassroots movements. And I was wondering where you thought the most need for that support was right now and what kind of support was most needed.

Well, I think it's public. It's public support. You know, our politicians want to get elected, so they, you know, run focus groups and they want. They try to find out what you think, and if they find out that that's what you think, then they'll stand for that.

So if you could. If you could do something on behalf of, say, the democracy movement in Burma or to try to help Georgia stay democratic against Russian resistance, what do those countries need? Like, what can be done internationally that isn't the Bush model?

Well, I see you're talking about repressive regimes. I mean, it's very difficult because when the repression goes beyond the tipping point, there's very little you can do from the outside because you have no leverage. You've got a lot more leverage by countries that are part of the global system. You then have some from the outside. You can bring something when they go overboard, like Burma or Uzbekistan, then it becomes Zimbabwe. I mean, all you can do, of course, is to support the people in the country. And it's interesting that even in Zimbabwe, which is a country, you know, that's been really going down the drain, there are still people who stand up for. For their rights. So supporting them is the only thing you can do.

If I may, I would also like to know, how useful do you think it would be as a way of spreading democracy internationally? How useful do you think it would be to try to promote greater literacy and especially female literacy in the Arab world as a way of stemming radicalism.

In the Arab world? I think that there are people in the Arab world also. It's difficult because currently people are being radicalized. You see, there's a process going on now where extremists are playing off each other. Extremists on our side and extremists on their side. And that leads to an escalation, and it's very difficult then for anybody to be moderate in between. And that's a tragedy that is currently occurring in the Arab world.

So my question is not about the war on terror, but I actually have two questions having to do with your roles as a financial trader, philanthroper, and someone who's been involved in the transition in Eastern Europe. So one question is that the basis for capitalism is supposed to be homo economicus, who pursues rational self interest. And then the invisible hand makes everything work out. So the first question is, what is your view of the relationship between altruism and capitalism? And the second question is, we've heard a lot about the ills of a repressive government versus an open society. So what is the use of government at all? Or can society just be sort of self organizing? Those are my two questions.

Let me take it the other way. I think the answer is no. I think that you can't avoid the need for government. And actually market fundamentalists argue that you leave it to the markets that people make their own decisions and everybody pursuing their self interest will serve the common interest. It's a nice idea, but it's unfortunately or fortunately false. Because markets are only designed to allocate resources among competing private needs. They are not designed to take care of collective common needs. And that requires government, you see, that is what requires government, including maintaining markets. If you didn't have regulators, financial markets would collapse. So you do need government. And I think, coming to your first question, I think that being concerned with the common good is quite a rational thing to do. So I don't see it as being in any way in conflict with rationality or even homo economicus. And if I decide to use my money for philanthropy, you know, that is one of the elements that come. I spend money and it can be accommodated in the market system. So I don't see a problem. But I think, and I think that philanthropy can do some good. But to think that private philanthropy could replace the role of government is a false idea also. And actually in my philanthropy, we very much try to influence the way the government spends money. So let's say we support after school, which is a very good thing, but we couldn't possibly finance after school for every kid in America. That has to be public spending. So we look for matching funds. Funds. And let's say in New York City now you have after school in most of the schools because the city government, the state government, and even the federal government also puts in money.

Thank you. Let's have two more questions. Three more questions. Four more questions. Do them quickly.

Okay, we'll try to be.

I wanted to say first out loud that I personally really appreciate your dedication to this issue. I'm sure that's one reason why there still aren't many people here. I think it's a tremendously important issue for a lot of reasons. And my specific question is there's been some Discussion, even right here today, about the question, question of persuasion and dialogue here at home in America. Have you found any particular kinds of things to say, you know, sound bite or longer, that you think are helpful in talking to people who don't agree with you?

Well, unfortunately, I can't put it in a soundbite, otherwise I wouldn't have put it in a book.

Maybe just keep talking and smiling. Thank you. Hi there. Some of the things you said I really agree with. For instance, the abstract war on terror creating a lot of. Well, it's hurting a lot of innocent people. You said people. But I also think it's hurting a lot of innocent abstractions like the Fourth Amendment in the name of the Patriot act and other things which are actually, I think, more scary to the survival of this nation than anything else in history. But there was an implicit comparison that you made between Israel and the United States. And maybe I misheard or misunderstood, but Israel invading Lebanon in the last few weeks doesn't seem to strike me as a close comparison or parallel to the United States going out of its way to invade Iraq. I mean, Israel was attacked directly, and you may say, well, only two of its military people were taken, etc. Etc. But Israel has been dealing with a 6,000-year-old blood feud for a long time with its older brother or Isaac's older brother, Ishmael. So I think my personal take is it's different. But what's your take on that?

You are absolutely right, and maybe I should have made that point. I just. I'm glad that you are bringing it up so I can make it. There's no question that Israel was attacked and has a right and a duty to defend itself, and it can't tolerate a terrorist or whatever organization on its borders with rockets that can disrupt life in Israel. So, however, you could be concerned that the response was perhaps too indiscriminate for Israel's own good. In other words, I think it may have been a mistake to, let's say, hurt the Maronite Christian community in order to disrupt the possible road to resupply. In other words, you have to be a little bit concerned with Lebanon because Israel needs a functioning state. Lebanon is a failed state and Israel is destroying it further. And that, I think, is counterproductive. But that is a different kettle of fish from the invasion of Iraq. So your point is very well taken.

First, I'd like to thank you not just for the big philanthropy you do, but also the smaller. I volunteered with a small group, a despised, depressed group, prisoners and your organization made a donation to them and it's made such a difference. My question. Well, I'll preface it by saying that Google aspires to be an open society where employees can question and criticize decisions made by the leaders of the company. We do that all the time. One of the most controversial ones has been Google's decision with China that in order to be able to have a service that the Chinese government won't try to blame. Eric can correct me if I'm misummarizing it. We agree not to allow searches on certain words. And some people, the company takes the position that it's better to give the Chinese some, you know, most access than no access. While other people think Google's being evil. I'd like your opinion. You can direct your response to me.

Realm. I would say two things that may be relevant. One, that if you somehow it comes up in the search that this site is blocked, I think that is, to me, would be satisfactory information to provide at the request of the Chinese government. I think that would be valuable information for the Chinese search people who are searching. I think that would be a very good way. Now, how to maintain certain standards, I think that it's important that the industry establish certain standards and agree to abide by those standards because otherwise, let's say Google might take a higher position and others would undercut it by providing that service. So here you need to have common standards to which all the entire industry subscribes, and then you can actually maintain those standards.

And for the record, that's in fact our view as our employees, I believe all know if a result is censored by the software we have built, we say that this entry was removed and we notify the Chinese end user that that information was not available to them by law. And our competitors do not. That is also correct that our competitors do not. You have the honor of the last question. Well, then I'll try to keep it short. There's another, I think, false metaphor that's being that's been used and has been misused, which is the war on drugs comparable to the war on terror that has been used for other purposes than what it's nominally intended to fight. Can you see what do you see any parallels?

Yeah, I do see the parallel. And it's ironic that when I established an American branch for the Open Society Institute, that was one of the first issues that we took on the war on drugs. Because the war on drugs is doing more harm than drugs themselves. It doesn't mean that drugs are okay or they do cause a lot of damage, but the war on drugs has caused a lot more damage. So actually, that was one of our first projects. And little did I know that I'd be waging war under war on terror 10 years later.

Thank you. So with that, it's a great honor to have you here in your lifetime, which will go on for a long time. I suspect. You have changed markets, you've changed societies in many ways for the better. I think a lot of people give you very strong credit for your role in opening up, literally the end of the Cold War, bringing a lot of things that were worries of my generation to a point of peacetime. And I think we all wish you good luck.

Before you applaud, let me just correct you on that. Again, I'm sorry. I really appreciate. I really enjoyed this conversation, but I can't change markets. I'm sorry.

Do you know where I got.

I can anticipate markets.

Do you know where I got all my information from? Google. Okay, thank you very much.