CHAPTER 2

The Meaning of Open Society

The meaning of open society is obvious to those who have lived in a closed society. Open society denotes freedom and the absence of repression. When I set up a network of foundations in the former Soviet empire, I did not think it necessary to explain the concept of open society to the people concerned because it was the opposite of everything they had experienced. When repression ceases, the memory of it fades as time goes on. The United States is an open society, but people have little understanding of the concept, and even less commitment to it.

Open society is not an easy idea. It resembles the concept of liberal democracy but there is an important difference: it is an epistemological concept, not a political one. It is based on the recognition of our imperfect understanding, not on a political theory. This poses considerable philosophical and practical difficulties. The best way to explicate them is to provide a historical account.

As already mentioned, I was introduced to the concept of open society by Karl Popper. His book, The Open Society and Its Enemies, made a deep impression on me because it threw a new light on the ideologies that had had such a decisive influence on my life: fascism, national socialism, and communism. He argued that these ideologies shared a common feature: They asserted that they were in possession of the only valid interpretation of reality, and they demanded absolute loyalty to their point of view. But the ultimate truth is beyond human reach; therefore these ideologies could be imposed on society only by the use of force or other forms of compulsion. And repression serves to bring about a closed society.

Popper proposed a form of social organization that starts with the recognition that no claim to the ultimate truth can be validated and therefore no group should be allowed to impose its views on all the rest. He called this form of social organization the open society in which people of different views and interests are able to live together in peace. In an open society, individuals enjoy the greatest degree of freedom that is compatible with the freedom of others. What constraints are needed are set by the rule of law.

The term “open society” was first used by Henri Bergson, the French philosopher, in his book Two Sources of Morality and Religion, published in 1932. He argued that morality and religion could be based either on tribal identity or on considerations of the universal human condition. The Old Testament was an example of the former, the New Testament of the latter. Tribal morality gave rise to a closed society, which confers rights and obligations on members of the tribe and discriminates against outsiders; universal morality leads to an open society that recognizes certain fundamental human rights regardless of tribal, ethnic, or religious affiliations. Popper took the argument a step further: He made the point that universal ideologies such as communism could also pose a threat to open society if they claimed to represent the incontrovertible truth and if they discriminated against those who disagreed with that claim. He based the argument for open society on our inherently imperfect understanding, or fallibility.

Karl Popper did not give a definition of open society because he disliked definitions. It follows from our fallibility that any definition is bound to be distorted or incomplete and it is liable to give rise to an interminable debate about the meaning of words. Popper preferred to describe ideas, and then he liked to put a label on them. His method went from right to left, instead of from left to right. When he described various intellectual positions, he used labels, and they usually ended with an “ism”; indeed, Popper’s writings are loaded with “isms.” As a label, “open society” gained added significance because it found its way into the title of Popper’s book. Apparently, The Open Society and Its Enemies was not the only title Popper contemplated, but the choice was made by the publisher. So open society attained the significance it holds for me almost by accident. I found it alluring because it stood in contrast to fascism and communism, and I had suffered under both. It may be fair to say that I put greater weight on the concept of open society than Karl Popper himself did.

In Karl Popper’s writings, open society is not a fully developed concept. It is based on the idea that perfect knowledge is beyond the reach of the human intellect. An open society accepts our fallibility; a closed society denies it. It is not even clear whether open society is meant to denote an actual state of affairs or an ideal one. It cannot be a full representation of reality because it is based on only one aspect of reality, an abstract and philosophical aspect, and leaves other aspects, such as political power or historical context, out of account.

I have to confess that it took me a long time to recognize that the concept of open society lacks a proper grounding in political theory. It is only recently that the full implications of this fact dawned on me. When I first read The Open Society and Its Enemies, I was so impressed by it that I elaborated a conceptual framework juxtaposing open society and closed society. I will summarize the framework here. Readers who are interested in a fuller version can turn to the appendix.

The framework was built on the concept of change. I defined change to exclude everything that is predictable. This means that only events that could not be expected in accordance with the prevailing state of knowledge qualify as change.

First, I considered a society built on the absence of change. In such a society, the mind has to deal with one set of conditions only: that which exists at the present time. What has gone before and what will come in the future are perceived as if they were identical to what exists now. There is no need to distinguish between thinking and reality; there is no room for abstract thinking. What I called the traditional mode of thinking has only one task: to accept things as they are. This supreme simplicity extracts a heavy price: It generates beliefs that may be completely divorced from reality. The traditional mode of thinking can prevail only if members of a society identify themselves as part of the society to which they belong and unquestioningly accept their place in it. I called this an “organic society,” a society in which individuals are organs of a social body.

Whether organic societies ever existed in reality or only in our imagination is an open question. But if they existed at all, they were certainly vulnerable to forms of social organization that had a better grasp of reality. So however attractive some features of an organic society may be to some people, organic society is not an option for today.

Change, the way I defined it, breeds uncertainty. There are two ways to deal with uncertainty: We can accept it or deny it. The former leads to a critical mode of thinking and to an open society; the latter to a dogmatic mode and a closed society. Each approach has its merits and drawbacks. Inspired by Karl Popper, I constructed a framework of theoretical models that contrast the strengths and weaknesses of the two approaches.

In a changing world, people are confronted by an infinite range of possibilities. Choosing among them is the key function of the critical mode of thinking. The great merit of the critical process is that it can provide a better understanding of reality than the traditional or the dogmatic mode. Its major drawback is that it does not satisfy the quest for certainty. In my model, I examine how the critical process works in some of the major fields of human endeavor, notably natural science, social science, economics, and politics. It works best in natural science, but it does not live up to expectations in the other areas. This is a source of disappointment that drives people to a dogmatic mode of thinking. The dogmatic mode is in many ways the opposite of the critical mode: It gives people the illusion of certainty but it distorts reality.

An open society recognizes and accepts the uncertainty inherent in reality. It is characterized by institutions that allow people to cope with uncertainty. Economic activity is guided by markets in which participants are free to make their own decisions. As long as there are enough choices available, participants can allocate their resources to their best advantage. Financial markets provide an efficient feedback mechanism for deciding whether or not their investment decisions were correct. But markets are not perfect. Contrary to some economic theories, they do not assure the optimum allocations of resources. They are designed to offer the participants alternatives, but the participants do not enjoy perfect knowledge. This makes markets, particularly financial markets, inherently unstable. Moreover, markets are not designed to take care of social needs—such as the maintenance of law and order, the protection of the environment, social justice, and stable and competitive markets—as distinct from the needs of individual participants. The satisfaction of social needs is in the domain of politics.

The political system appropriate to an open society is a democracy in which people are free to choose—and to change—their government. A democratic form of government is more likely than other forms to avoid grievous mistakes.

Thus, the main merits of an open society are that it allows people to cope with an uncertain reality and assures them the greatest possible degree of individual freedom compatible with the satisfaction of social needs. In particular, an open society insists on the freedom of thought and expression.

On the negative side, the paramount position enjoyed by individuals imposes a burden on them that may at times appear unbearable. Where can they find the values they need to make the correct choices? Values are a matter of choice. The choice may be conscious and the result of much soul-searching and reflection; but it is more likely to be impulsive, based on family background, advice, advertising, or some other external influence.

Recent findings in cognitive science indicate that the way decision-making works has some similarities with vision. Just as there is central vision which is sharp and enters into a central consciousness; peripheral vision is blurred and perceived selectively. In the same way, some decisions are conscious, others are instinctive. We know the reasons for our conscious decisions, but we make many choices of which we are only dimly aware. Marketing experts and political operatives focus on the unfocussed. Some of these choices are driven by the search for pleasure. But when we go beyond choices that provide immediate satisfaction, we find that open society suffers from what may be termed a deficiency of purpose. By this I do not mean that no purpose can be found, but merely that it has to be sought and found by each individual. This search places us in a quandary. Individuals are the weakest units of a society and have shorter life spans than most of the institutions that depend on them. On their own, individuals provide an uncertain foundation for values sufficient to sustain a structure that will outlast them. Yet such a value system is needed to sustain society.

Whether an open society can flourish despite its deficiency of purpose depends greatly on its ability to generate a pervasive sense of progress. Freedom releases creative energies, and open societies are usually characterized by scientific and artistic achievements, technological innovations, intellectual stimulation, and improved living standards. But success is not assured because it remains conditional on the creative energies of the participants.

When an open society fails to produce a sense of well-being and progress, those who are unable to find a purpose in themselves may be driven to a dogma that provides them with a ready-made set of values and a secure place in the universe. The dogmatic mode of thinking consists of establishing as paramount a body of doctrine that is believed to originate from a source other than the individual. The source may be tradition, or it may be an ideology that succeeds in gaining supremacy in competition with other ideologies. Either way, the source is declared the supreme arbiter of conflicting views: Those that conform are accepted; those that are in conflict, rejected. If an ideology manages to prevail, it can remove the fearful specters of uncertainty and deficiency of purpose and infuse people with a sense of pride and satisfaction. On the negative side, closed societies tend to exercise close control over speech and thought and engage in various forms of repression in order to impose their version of the collective interest over the interests of individual citizens.

No matter how the collective interest is defined in theory, in practice it is likely to reflect the priorities of the rulers. The rulers are not necessarily furthering their selfish ends as individuals, but they do benefit from the prevailing system as a class: By definition, they are the class that rules. Closed society may therefore be described as a society based on class exploitation.

At its best, an authoritarian system can go a long way towards reestablishing the harmony of organic society. But more often some degree of coercion must be employed, and this fact needs to be explained away by tortuous arguments that render the ideology less convincing. The result is that more force is applied until, at its worst, the system is based on compulsion and its ideology bears no resemblance to reality.

As the coercion employed to maintain the dogma increases, the needs of the inquiring mind are less likely to be met. When finally the hegemony of a dogma is broken, people will feel that they have been liberated from terrible oppression. Wide new vistas are opened and the abundance of opportunities engenders hope, enthusiasm, and tremendous intellectual activity.

Open society and closed society present themselves as alternatives. Each suffers from deficiencies that can be cured by the other. This was appropriate at the time I constructed the models because the camps representing the two forms of social organization confronted each other in the Cold War, but it is not necessarily true at all times. If we build models of society based on a dichotomy between recognizing or denying that our understanding of reality is inherently imperfect, then the models are bound to appear as alternatives. It does not follow that people are obliged to use such models for their thinking.

Unfortunately, it is not clear what the framework (discussed in greater detail in the appendix) is supposed to represent. It cannot claim to describe historical situations. I made no attempt to provide evidence that any of the models have ever existed in their pure form, and I expressly disclaimed that the models could be used to describe a pattern in history. These were meant to be theoretical models, derived from the idea of fallibility largely by the use of deductive logic, yet they did not totally lack a historical perspective. Notably, organic society and a traditional mode of thinking had to precede closed society and a dogmatic mode of thinking. The whole framework had a particular relevance to the moment in history when it was constructed. During the Cold War, two competing social systems, based on two different modes of thinking, were competing against each other. Conceived when communism was at the height of its influence, the framework is balanced in its presentation of the strengths and weaknesses of open and closed societies. I made no secret of my bias in favor of open society, but I did not predict its inevitable triumph (that is just as well, since open society is once again endangered). In spite of its shortcomings, this was the conceptual framework that guided me when I established the Open Society Foundation.

THE FOLLOW UP

The conceptual framework outlined here and presented at greater length in the appendix formed part of a manuscript titled The Burden of Consciousness, which I completed in 1963. I sent the manuscript from New York, where I was working as a specialist in foreign stocks, to my erstwhile tutor, Karl Popper. I received an enthusiastic acknowledgement, which prompted me to visit him in London. At the appointed time, several graduate students were waiting for him, and they looked at me as an unwelcome intruder. I went into the corridor, and when Popper stepped out of the elevator, I introduced myself. It was obvious that he did not remember me. When he connected me to the manuscript I had sent him, he said: “I am so disappointed, and I shall explain to you why—I thought you were an American, to whom I had successfully communicated my views on totalitarian dictatorships. But you are Hungarian, and you experienced them at first hand.” Nevertheless, he was very kind and encouraging.

Responding to his encouragement, I continued to revise the manuscript, but I could never resolve the basic ambiguity inherent in the models: Are they timelessly valid generalizations or are they idealized versions of historical situations? I got lost in philosophical abstractions. I decided to quit and devote myself to making money. This led me to develop the boom-bust model that eventually formed the subject of my first book, The Alchemy of Finance.

My success in the financial markets exceeded my expectations. As I was approaching fifty and the size of my hedge fund was approaching $100 million, I started wondering what I should do with the money I was earning. My personal wealth was around $30 million at the time, and I felt that it was more than sufficient for me and my family. I thought long and hard about what I really cared about. This took me back to the framework of open and closed societies; I set up an Open Society Fund and defined its objectives as follows: to open up closed societies; to make open societies more viable; and to promote a critical mode of thinking.

THE OPEN SOCIETY FOUNDATION

The Open Society Foundation got off to a slow start. My first major engagement was in South Africa, where, after an exploratory visit in 1979, I gave scholarships to African students attending the University of Cape Town. South Africa was a closed society in which whites lived in the first world and blacks in the third. I wanted to break down the barrier by giving Africans a first-class education and I tried to use the system to undermine it from the inside. All students, whether white or black, were entitled to free university tuition. I wanted to take advantage of this provision by giving African students stipends so that they could attend Cape Town University—an institution that proclaimed its commitment to the ideal of an open society. Unfortunately, the black students remained alienated and resentful, and when I found that out, I abandoned the scheme. I came to the conclusion that the apartheid regime was too strongly entrenched to be subverted from the inside. After the collapse of the apartheid regime, I regretted that decision.

I continued a few other initiatives in South Africa, but concurrently with them, I started supporting dissidents in Eastern Europe, including Charta 77 in Czechoslovakia, Solidarity in Poland, and Jewish Refuseniks in the Soviet Union. I became active in Helsinki Watch, the precursor of Human Rights Watch. I offered scholarships in the United States to dissident intellectuals from Eastern Europe, and this was the program that led me to establish a foundation in my native country, Hungary, in 1984. The scholarship scheme supplied me with a group of trusted advisers on whom I could rely in my negotiations with the Communist authorities in Hungary. The negotiations were protracted and they resulted in a complicated arrangement with the Hungarian Academy of Sciences as my partner. We established a joint committee, an official of the academy and myself as co-chairmen. The rest of the board members were independent-minded Hungarian intellectuals, approved by both parties. Both parties had the right of veto over the decisions of the committee. The question of who would execute the decisions was a thorny one, and it nearly caused a breakdown in negotiations. Eventually, we were allowed to have an independent secretariat; but since the academy also had to be represented on it, the academy’s representative, as well as our secretary, had to sign communications.

The foundation gave small grants to a wide variety of civic initiatives that were independent of the prevailing party-state mechanism. We provided support to experimental schools, libraries, amateur theatrical companies, the zither players’ association, farmers’ clubs and other voluntary social organizations, artists and art exhibitions, and cultural and research projects. We carefully calibrated our activities so that the programs that would be considered constructive by the government outweighed those that would be regarded with suspicion by the authorities in charge of ideology. The idea was to break the monopoly of the party-state: The falsehood of the prevailing party dogma would become apparent when an alternative was available. The idea worked. With a $3 million budget, the foundation provided an effective alternative to the Ministries of Culture and Education, which had vastly greater resources.

The foundation was exempt from the limitations and negative side effects that afflict other foundations. Civil society adopted the foundation as its own and took good care of it. We did not have to exercise controls; civil society did it for us. For example, when we wanted to give a grant to an association of the blind for talking books, somebody warned us that the organization was corrupt. The tip-off enabled us to avoid being taken advantage of. I visited Hungary often; and whenever we decided on a course of action, the next time I visited, I found the decision miraculously translated into reality.

Encouraged by the success of the Hungarian foundation, I ventured further afield. By 1987, I had set up foundations inside Poland, China, and the Soviet Union. The foundations in Poland and the Soviet Union succeeded, but the one in China failed. In the Soviet Union, I took my cue that something had changed when Mikhail Gorbachev telephoned Andrei Sakharov, who was in exile in Gorky, in December 1986 and asked him to “resume his patriotic activities in Moscow.” (Sakharov told me later that the telephone line had to be installed the night before especially for the occasion.) If it had been business as usual he would have been sent abroad.

I went to Moscow in early March 1987 as a tourist, and ended up setting up a foundation on the Hungarian model with the Cultural Foundation of the USSR as my partner. The Cultural Foundation was a newly formed organization, and Raisa Gorbachev was its patron. Our joint venture was called Cultural Initiative. I was hoping that Andrei Sakharov would be my personal representative, but he refused. “Your money will go to fill the coffers of the KGB,” he told me. I am proud to have proved him wrong.

In China, I went into partnership with an institute that was promoting economic reform. Our main activity was providing scholarships for study abroad. The idea of awarding grants on the basis of merit was an alien concept. People who received support felt obliged to the provider; moreover, they felt that the provider was obliged to them because the provider’s reputation depended on the success or failure of its grantees. I called this attitude “feudalism of the mind.” The foundation was caught up in a power struggle within the party. Normally, dozens of relevant authorities have to sign off on a new initiative; for this one, the joint venture was authorized by the sole signature of Bao Tong, an aide to the general secretary of the party, Zhao Ziyang. This attracted the attention of the internal security organs and they used the foundation to attack him and his patron, Zhao Ziyang. To protect himself, Bao Tong transferred the foundation to the direction of the external security organs, which removed the foundation from the purview of the internal organs. When I discovered that the foundation was effectively run by the political police, I closed it just before the Tiananmen Square massacre. Regrettably, Bao Tong ended up in jail.

As the Soviet empire disintegrated, I continued to set up foundations in other countries. By 1991, I had a network of foundations covering more that twenty countries. I never bothered to explain what I meant by open society. People understood instinctively that it meant the opposite of the closed society from which they wanted to free themselves.

OPERATING IN FAR-FROM-EQUILIBRIUM CONDITIONS

This was a revolutionary period, not only for the countries of the former Soviet empire, but also for me and my foundation network. I considered myself a specialist in far-from-equilibrium situations. My father had taught me that at the height of a revolution, practically anything is possible. The first man who walks into a plant manager’s office, he told me, can take over the plant; the next man already finds somebody in charge. Armed with this insight, I was determined to be the first man. I was in a unique position to accomplish this. I had political convictions, financial means, and an understanding of the importance of the moment. Many people had one or two of these attributes, but I was unique in having all three. I felt duty-bound to devote all my energies to the work of the foundations. Other Western foundations moved so slowly that it took them years to overcome the legal obstacles; I plowed ahead without paying much attention to legal niceties. In the Soviet Union, we started functioning two years ahead of other foundations, and we had the field to ourselves. We established foundations in Estonia, Lithuania and Ukraine even before they became independent. The Central European University, which was meant to serve as an intellectual resource center to the foundation network, started giving graduate courses even before it was accredited—the first students received their degrees retroactively. We operated without a plan or a budget during this period of explosive growth. We embarked on numerous new initiatives, but we cut them off if they did not live up to expectations; and when they had fulfilled their mission, we terminated them. Our annual expenditures jumped from $3 million to more than $300 million within three years. This would not have been possible if we had operated in a more conventional manner.

We engaged in a wide range of activities. In a transition from a totalitarian system to an open society everything needs to be done at once, and in many areas we were practically the only source of support. We were ready to back almost any project if we could identify people, either inside or outside the country, on whom we could rely to carry it out. Because the dollar went a long way in that part of the world, we became involved in a myriad of projects. The whole was greater than the sum of the parts: taken together, the projects had a significant social and political impact in fostering open societies. Occasionally, we made some very large grants; we called them “mega-projects.” For instance, I allocated $100 million to preserve and reform Soviet science. This was a time of hyperinflation and $500 was enough for a family to live on for a year. The International Science Foundation gave out more than 25,000 emergency grants to the most prominent scientists selected by a simple and transparent method: three citations in an internationally recognized journal was the criterion. The $500 grants were paid in dollars. That cost less than $20 million. The rest of the money went for research projects selected by peer review in which leading scientists from all over the world participated. The scheme was attacked in the Russian parliament, but it was vociferously defended by the scientists. The Duma eventually passed a vote of thanks.

I focused my energies on setting up the foundations, selecting the boards that were to be entrusted with spending my money, and addressing the larger issues of economic and political reform. As early as 1988, I proposed setting up a market-oriented open sector within the Soviet Union that would be implanted within the body of the centrally planned economy. The Soviet authorities responded positively and a series of high-level meetings were held until it became clear that the centrally planned economy was already too weak to nurture a market economy. Later, I became intimately involved in the so-called Shatalin Plan, which sought to replace the Soviet Union with an economic union among independent states; and I shepherded a Soviet delegation, led by Grigory Yavlinsky, through the 1991 annual meeting of the World Bank and International Monetary Fund (IMF), during which they tried—in vain—to gather international support. In Poland, I advocated and supported the Big Bang—a sudden transition to a market economy—that was introduced on January 1, 1990. Subsequently, I prevailed on the Hungarian government to convoke a meeting exploring how the Comecon (an international trade agreement among Communist countries) could be reorganized along market-oriented lines, again without success.¹⁰

As a general rule, whenever a task could be accomplished with my foundation’s resources alone, it got done; whenever it involved persuading policymakers or institutions, it ran aground. For instance, when Leonid Kuchma was elected president of Ukraine, I was able to provide him with advisors who helped Ukraine obtain an IMF program within a few weeks; when I tried to persuade the IMF to earmark its assistance to Russia for the payment of pensions and unemployment benefits, I failed.

I became intimately involved in the affairs of the Russian state during Boris Yeltsin’s presidency. I watched at close quarters, but did not participate in, the infamous Loan for Shares scheme. I did participate in the first auction in which the state received real money: the privatization of Svyazinvest, the state telephone company. I did so in the belief that robber capitalism was about to give way to legitimate capitalism. I was wrong, and my purchase turned into the worst investment decision of my career. The robber capitalists fell out with one another and engaged in a no-holds-barred fight among themselves. The egregious deals and corruption I witnessed defies the imagination.

APPLYING THE FRAMEWORK

During all this time, I was guided by the conceptual framework I outlined earlier. In my 1990 book, Opening the Soviet System, I combined the static models of open and closed societies with my theory of reflexivity to provide an interpretation of the rise and fall of the Soviet system. To do so, I introduced an interesting modification to the boom-bust theory that models an initially self-reinforcing, but eventually self-defeating, process of change. I applied the same approach to the absence of change. I justified it by arguing that changelessness, instead of being an expression of equilibrium, is also a condition of disequilibrium characterized by a large gap between prevailing perceptions and actual conditions, and that there is a reflexive interaction between them. My contention was that changelessness can also take an initially self-reinforcing, but eventually self-defeating, course. Here is an extract:

In a closed society the prevailing dogma is far removed from reality, but the system is viable as long as there is a way to adjust the dogma when it gets too far out of line with reality. A totalitarian regime needs a totalitarian at the top. Stalin fulfilled that role with gusto. He enforced the dogma but also changed it when necessary. Under him the system attained its maximum extension, in both ideological and territorial coverage. There was hardly an aspect of existence that escaped its influence. Even genetics obeyed Stalinist doctrine. Not every science could be subjugated with equal success, but at least the scientists could be tamed and their contact with youth restricted by confining them in the Institutes of the Academy and preventing them from teaching at universities. Terror played a large part in making the system work but the cover of ideology successfully concealed the underlying coercion and fear.

It is a testimony to Stalin’s genius that the system survived him by some thirty-five years. There was a brief moment of hope when Khrushchev revealed some of the truth about Stalin in his speech before the Twentieth Congress but, eventually, the hierarchy reasserted itself. This was the period when dogma was preserved by administrative methods, without any belief in its validity. As long as there had been a live totalitarian at the helm, the system enjoyed some maneuverability: the party line could be changed at the whim of the dictator and the previous one excised. Now that flexibility was lost and the system became as rigid as my theoretical model prescribes. At the same time a subtle process of decay set in. Every enterprise and institution sought to improve its own position. Since none of them had any autonomy, they had to barter whatever powers they had for the resources they needed for their own survival. Gradually an elaborate system of institutional bargaining replaced the central planning and central control that had prevailed while the system had been in totalitarian hands. Moreover, an informal system of economic relationships evolved which supplemented and filled the gaps left by the formal system. The inadequacy of the system became increasingly evident and the pressure for reform mounted.

I went on to argue that reform accelerates the process of disintegration. It introduces or legitimizes alternatives at a time when the system depends on the lack of alternatives for its survival. Alternatives raise questions; they undermine authority; they not only reveal discrepancies in the existing arrangements but reinforce them by diverting resources to more profitable uses. A command economy cannot avoid a misallocation of resources: Introduce a modicum of choice and the shortages are bound to become more pronounced. Moreover, the profits that can be earned by diverting resources from the command economy are much greater than what can be earned from productive activity; it is therefore not at all certain that overall production will benefit.

As a consequence, I argued, the Soviet Union was in a state of total disintegration. All aspects of the system were affected, its ideology, its morality, its government, its economy, and the territorial empire. When the system had been intact, all these elements were integrated; now that the system was falling apart, the elements were decaying in various ways and at various speeds, but events in one area tended to reinforce developments in the others. I gave a prescient account of the ensuing chaotic conditions that was based on this analysis.

PROMOTING OPEN SOCIETY

At the same time as I was writing Opening the Soviet System, I was putting into practice my ideas about open society. My foundations were expanding by leaps and bounds. There was no plan, not even a budget. We proceeded on the basis of trial and error. This method had a downside: We made a lot of errors. As a result, the foundations got caught up in the turmoil in which they sought to act as a guide. This was particularly true in Russia. Just before the August 1991 putsch that briefly deposed Gorbachev, I had to organize a putsch within the foundation to regain control. Unfortunately, the people who helped me in the putsch also got out of control, so I had to organize a second putsch to remove them. These events caused us to lose valuable time at a critical moment in Russian history.

My goal was to make my foundations into a prototype of open society, but I realized that this ambition was a fertile fallacy. An open society has to be self-sustaining, but the foundations depended on my financial support for their survival. In reality, the foundations played the role of deus ex-machina; but it takes a deus ex-machina to alter the course of history. An open society is a more sophisticated, more advanced form of social organization than a closed society. A closed society requires only a single interpretation of reality: the one embodied in the prevailing party-state dogma. In an open society, every citizen is required to form his or her own view of the world, and society needs institutions that allow people with different views and interests to live together in peace. The task is so immense that it is impossible to make the transition from closed to open society in one step without a helping hand from the outside. It was this insight that drove me to devote all my energies and resources to providing such a helping hand, exactly because my insight was not widely shared. Regrettably, the West failed to rise to the occasion. As a result, the transition was never accomplished in most of the former Soviet Union.

REVISING THE FRAMEWORK

I have not changed my opinion about the failure of the international community to provide assistance, but in other respects I was forced by my experiences to undertake a major revision of my conceptual framework. The framework treated open and closed society as alternatives. The lesson I learned was that the collapse of a closed society does not automatically lead to an open society; it may lead to continuing collapse and disintegration that is followed by some kind of restoration or stabilization. Thus a simple dichotomy between open and closed society is inadequate.

Open society is endangered not only by dogmatic ideologies and totalitarian regimes but also by a breakdown of society and failed states. Stephen Holmes, a political scientist who worked with my Russian foundation, put it well in his article: “What Russia Teaches Us Now: How Weak States Threaten Freedom.”¹¹ This was new. Popper considered only totalitarian ideologies enemies of the open society. My original framework recognized that too much liberty and a deficiency of purpose may make dogmatic ideologies attractive; but it left out of account the possibility that the breakdown of a closed society may not give rise to an open society but to further disintegration. Instead of treating open and closed society as alternatives, I had to reposition open society as being threatened from both directions: too much liberty, anarchy, and failed states on the one hand; dogmatic ideologies and authoritarian or totalitarian regimes of all kinds on the other. Open society came to occupy a precious middle ground that was endangered by extremes of all kinds.

This construction fits in well with the modified boom-bust theory I used to account for the rise and fall of the Soviet system: Open society constitutes near-equilibrium conditions precariously poised between the static disequilibrium of a closed society and the dynamic disequilibrium of chaos and disorientation. Equilibrium in this context denotes a correspondence between reality and its perception. Near-equilibrium is superior to far-from-equilibrium conditions because it enables participants better to cope with reality than they could if their views were far removed from reality. The participants may not agree with this judgment: They may prefer to be deluded; but in any contest, those whose understanding is closer to reality have a better chance of prevailing.

This tripartite division between static disequilibrium, near-equilibrium, and dynamic disequilibrium may be compared to the three states of water: frozen, liquid, and gaseous. Closed society is rigid, open society is fluid, and revolution chaotic. The analogy is far-fetched, but it serves as a graphic illustration. The tripartite division is more complicated than a dichotomy, but it incorporates the lesson taught by the disintegration of the Soviet system.

If we have to abandon the dichotomy between open and closed, why use the term “open society” to describe liberal democracies? It will be recalled that it was almost by accident that Karl Popper’s book was titled The Open Society and Its Enemies. Out of that accident, open society has come to denote near-equilibrium conditions. The term “open society” is certainly more user-friendly than “near-equilibrium conditions,” but “liberal democracy” may be more exact. “Liberal democracy” is a term widely used in an international context, although “liberal” has become something of a term of opprobrium in domestic politics. Open society does not carry the ideological baggage attached to the word “liberal.” I intend to stick to it because I consider the epistemological argument behind it important, not to mention all the activities of my foundations that have been carried out under that name.

Open society means almost the same thing as liberal democracy, but it implies an elaborate conceptual framework that is not necessarily part of the concept of liberal democracy. Open society derives the need for liberal democracy from the recognition of our imperfect understanding or fallibility. This is not obvious from the expression “open society.” It needs to be made explicit by stating the argument. At the same time, the term “open society” describes a society that is open to the outside; this society allows the free flow of goods, ideas and people. “Open society” also describes a society that is open on the inside, a society that allows freedom of thought and social mobility. As a descriptive term, “open society” is self-explanatory, but the epistemological analysis behind it requires an explanation. I have gone through this long historical account to provide it.

THE NEXT CHALLENGE

The modified framework that currently serves as my conceptual guide is exposed to significant challenges. This forces me into further rethinking; but instead of considering the challenges on the level of timelessly valid generalizations, I shall treat them as problems that confront us (humanity in general, and me and my foundation network in particular) at the present moment in history. This is the approach I follow in most of my books. To expect a conceptual framework to be both timelessly valid and applicable to current conditions would contradict the postulate of imperfect understanding or fallibility—not only my postulate of radical fallibility but Karl Popper’s more modest contention that we may be wrong. As a participant, I cannot avoid giving expression to my biases. If I claimed for my opinions the same kind of timeless validity that I claim for my conceptual framework it would invalidate the framework. Moreover, my framework does not claim to be comprehensive. For instance, it lacks any consideration of power relations. Therefore, it cannot serve as the basis for arriving at practical judgments.

The challenge that preoccupies me emanates from an unexpected source: the United States. Who would have thought that the oldest, most well-established, and most powerful open society in the world could pose a threat not only to the concept of open society at home but also to peace and stability in the world? Yet that is what has happened in the aftermath of the terrorist attack of 9/11. In my previous book, I tried to pin the blame on the Bush administration. The Bubble of American Supremacy was a passionate political polemic in which I argued that by rejecting George W. Bush in the presidential elections of 2004 we would repudiate his policies. We could then attribute the excesses of the Bush administration since 9/11—which I compared to the later stages of a stock market bubble—to a temporary aberration brought about by the traumatic experience of 9/11 and then skillfully exploited by an ill-intentioned leadership. But that is not what happened. President Bush was reelected. I must now pose the question: What is wrong with us as a society? I shall explore this question in Part 2 of this book. The conceptual framework I have presented will be helpful in answering the question because it identifies some of the flaws that are inherent in an open society. That is my justification for having taken the reader on such a strenuous journey.

My concern is not only with the United States but with the world at large. The United States is the dominant power in the world today. It sets the agenda and the rest of the world has to respond. But the Bush administration has set the wrong agenda. It is difficult to identify exactly what it is because it is made up of various themes, but it is not difficult to establish that it is taking the world in the wrong direction. The survival of the fittest is a major theme, and competition, not cooperation, is supposed to determine who is the fittest. This is the wrong approach, however; our globalized world is not a jungle ruled by naked power. There is some order in the world, and how that order works depends greatly on how the dominant power behaves.

Globalization has made the world increasingly interdependent. Mankind faces challenges that can be met only through increased cooperation. The United States is not allpowerful, as we have discovered to great cost in Iraq, but little can be done in the way of international cooperation without the leadership of the United States, or at least its active participation. This places a special obligation on the United States to show concern for the well-being of the world as a whole. The rest of the world does not have a vote in Congress, but it is Washington that decides the fate of the world. In this respect, the situation is reminiscent of the time when America was a British colony and subject to taxation without representation. Now that the United States has become the imperial power, it bears a unique responsibility for the future of the world.

In discussing the problems of the prevailing world order, my conceptual framework is of limited use. It does explain why mankind’s ability to govern itself has not kept pace with its ability to exploit nature—it has to do with reflexivity—but it cannot provide a blueprint for global governance. My framework is built on an insight into the relationships between thinking and reality and it does not constitute a comprehensive view of the world. It is particularly ill-suited to deal with relationships of power. Nevertheless, we cannot avoid the issues of global governance. I have dealt with them in the past—particularly in my book Open Society: Reforming Global Capitalism. Part 2 of this work serves as a revision and an updating of that book in the light of recent developments. Although I speak of a global open society, it is more obvious to me now than it was at the time I wrote the previous book that I am discussing a political project and not an epistemological one.