Soros likens city's ills to those worldwide Billionaire tells GBA the region must help for all to prosper

Economic development

December 16, 1998|By Jay Hancock | Jay Hancock,SUN STAFF

On the second day of his first visit to Baltimore, billionaire George Soros described this region as a miniature version of the world, with much of the world's bounty, problems and promise.

Just as developed nations enjoy a bigger share of global wealth than countries on the economic periphery, so is the Baltimore region split between the have-less and the have-more, Soros told members of the Greater Baltimore Alliance, an economic development group.

"Here, it is the center that is disadvantaged, and it is [necessary] for the periphery to take an interest in the center if you want the whole region to prosper," he said in the accent of his native Hungary.

Soros, a controversial investor, speculator and philanthropist who is believed to be worth $5 billion, was the main speaker at the GBA's annual meeting yesterday. While his main mission in Baltimore involved a donation Monday of $6.25 million for after-school programs, he praised GBA's goal of boosting regional prosperity.

"I think all the selling you're doing will be justified," he said.

Soros declined to prescribe remedies for Baltimore's crime, illiteracy and drug addiction. "I really can't tell you what Baltimore should do because I know much less about the situation than you," he said. "I think it would be quite irresponsible for me to shoot from the hip on the issues involved."

Soros set up his Open Society Institute in Baltimore last year and pledged an initial $350,000 to the Safe and Sound Campaign to expand after-school activities and promote education.

He was attracted to the region, he said, after deciding to apply the same kind of charity in the United States -- "my adopted country" -- that he had exercised in Hungary and other developing nations.

"This is how I looked around and came to Baltimore," he said. "Here is a situation that is imperfect. I'm not supposed to say that, because we're all marketing Baltimore. But we all know that there are problems."

Soros said he was "impressed" by Safe and Sound's progress. "I think the grants that we gave make a lot of sense."

Soros is the best known of the international currency speculators who have reaped billions by attacking politically engineered exchange rates that are not supported by economic fundamentals.

Most currency operators shun publicity, but Soros has increasingly courted it through charity, magazine articles and books. Several times yesterday he referred to his latest book, "The Crisis of Global Capitalism," which proposes international regulation to assuage the very kind of turmoil he has helped cause.

"Markets are not perfect," he said. "They are unstable -- inherently unstable." Regulation is necessary "to prevent markets from swinging to extremes. We now have a global economy, but the international regulatory regime hasn't kept pace with it."

Besides the anger he has aroused by attacking currencies, Soros has been criticized for his advocacy of drug decriminalization, for allegedly supporting former Communists in Eastern Europe and for perceptions that he is biting the economic hand that fed him his billions.

Malaysian Prime Minister Mahathir Mohammad, for example, has called Soros and other speculators "immoral," "criminals" and "morons." The Malaysian ringgit came under speculative attack last year.

Pickets identifying themselves as members of the Lyndon LaRouche organization stood yesterday outside Baltimore's Hyatt Regency, where Soros appeared, and a heckler briefly interrupted Soros' speech before Baltimore Mayor Kurt L. Schmoke helped hustle the intruder out the door.

Asked about the world economy, Soros said the Russian crisis is "very, very serious" and that "conditions now will start to get worse." He added: "There will be probably another bout of hyper-inflation" and suggested a currency board as a possible solution.

Under a currency board, a troubled exchange medium such as the Russian ruble is backed 100 percent by a stable currency such as the U.S. dollar, making it nearly invulnerable to speculators.

Pub Date: 12/16/98

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