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The Seed Money for Democracy

Financier George Soros has put out $2.8 billion since 1990 to promote a global open society. His efforts include funding the student movement that helped oust Milosevic in Yugoslavia.


BELGRADE, Yugoslavia — It's an accomplishment that Hungarian-born financier George Soros doesn't flaunt. Bragging about it, after all, could just make his global democracy-building mission more difficult.

But the multibillionaire philanthropist quietly played a key role in the dramatic overthrow last year of President Slobodan Milosevic. His Soros Foundations Network helped finance several pro-democracy groups, including the student organization Otpor, which spearheaded grass-roots resistance to the authoritarian Yugoslav leader.

"We were here to support the civil sector--the people who were fighting against the regime of Slobodan Milosevic the past 10 years," said Velimir Curgus of the Soros network's Belgrade branch. "Most of our work was undercover."

Soros' efforts in Yugoslavia reflect just a small part of his enormous financial support over the past decade--at first tens of millions, then hundreds of millions a year--for democratically minded groups throughout the former Communist world. This work, which got his branch in Belarus expelled from that country in 1997, has helped strengthen thousands of nonprofit organizations in countries where, up until 1989, Communist parties ran almost everything.

Throughout Eastern Europe, find an independent group that promotes ethnic understanding, a free press or help for the disadvantaged and disabled, and it is likely that some of its money comes from Soros. The man seems to be everywhere.

Soros, 70, was once best known as the speculator who "broke the Bank of England" by reputedly making $1 billion in a single week in September 1992 betting against the British pound. But his main interest the past decade has been promoting democracy in the region of his birth. Globally, his network has spent or given away $2.8 billion since 1990, most of it in formerly Communist states.

"When I got involved there was a pressing issue, which was the collapse of the Soviet empire and the transition from a closed to an open society," Soros explained. "It was an historical opportunity, and I rushed in."

As Communist controls disappeared, resurgent nationalism, ethnic intolerance, pressure on free speech and authoritarian rulers threatened hopes for democracy. Soros saw as the antidote strong citizen organizations, respect for civil liberties and minority rights, the rule of law and the growth of market economies.

The Soros Foundations Network now lists branches in 27 formerly Communist countries. But Soros also believes that his principles are universal. His foundation has opened branches in Guatemala and Haiti as well as two branches serving 10 countries in southern Africa. It has also launched initiatives involving Myanmar, formerly Burma, and 16 countries of West and Central Africa.

It spends about 20% of its roughly $500-million annual budget on programs in the United States. In South Africa, it focuses on education and criminal justice. The New York-based Burma Project works for democratic change in that country. In general, the branches mainly disburse money to other nongovernmental organizations, but they also run some programs directly.

Yugoslavia was a case where everything democrats had worried about--extreme nationalism, ethnic conflict, corruption, media controls and bickering among opposition political parties--were at their worst. Yet, just as Soros had calculated, it was a grass-roots surge by strong citizen organizations that won the battle for democracy.

Soros' branch in Belgrade, the Yugoslav and Serbian capital, was among the earliest backers of Otpor, which grew under young and decentralized leadership to strengthen the fractured opposition to Milosevic. "We gave them their first grant back in 1998, when they appeared as a student organization," said Ivan Vejvoda, executive director of the Fund for an Open Society-Yugoslavia, the network's branch here.

Foreign financial support helped Otpor surreptitiously print about 60 tons of posters and leaflets in the months before the Sept. 24 election that led to Milosevic's ouster, said Miljana Jovanovic, a student who is one of the movement's leaders.

Otpor also ran humorous political ads on municipal television stations controlled by the opposition. One showed a homemaker using an "election" washing machine to get rid of a "Milosevic" clothing stain.

Vejvoda said his office also gave early funding to a group of economists called G-17, which grew into a kind of think tank for the Serbian opposition. In addition, Soros helped fund independent media in Serbia, the dominant republic of Yugoslavia, to counter powerful state television, which functioned as a mouthpiece for Milosevic.

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