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By end of the '70s he was very rich, very unhappy and entirely unfulfilled. He split with his original business partner and his wife. He acknowledged his relationship with his children was damaged, calling it "the biggest regret of my life." He became reclusive, living out of a small, sparsely furnished apartment in Manhattan. One year he lost money. He said later, "I underwent a serious change in my personality during that period. There was a large element of guilt and shame in my emotional makeup." Therapy helped, but philanthropy was the cure.
In the '80s Soros began to build his philanthropic empire. One of his first ventures was in his native Hungary, where he supplied the country with photocopiers, an inspired application of technology to fight censorship. As the democracy movement gained momentum throughout Europe, Soros swept in to fund it, at times acting as a one-man central bank for struggling countries. He established philanthropic offices all over Eastern Europe. Nominally centered in New York City under the direction of Aryeh Neier, the former head of Human Rights Watch, Soros' network of foundations in 31 countries employs about 1,300 people. Soros has spent about $1.1 billion sustaining free media, encouraging political pluralism, defending human rights.
In some places the authoritarian or nationalist governments that replaced the communists were just as unenthusiastic as their predecessors about Soros' continued push for open debate. Says his friend Byron Wien, head U.S. strategist at Morgan Stanley: "He was definitely not viewed as the Albert Schweitzer of our time, but as someone with an angle. He was not prepared for the hostility."
Although well known in Europe, Soros became frustrated because his huge wealth seemed to give him no political influence in the West. When the Berlin Wall fell, he sought to persuade both President George Bush and British Prime Minister Margaret Thatcher to endorse a new Marshall Plan to rebuild the societies shattered by 70 years of communism. Neither leader would give him the time of day. He realized he needed to become a public personality.
In the late summer of 1992, a time of great pressure on European institutions, he did so with a vengeance. A remark by the president of the German Bundesbank about possible instability among European currencies encouraged Soros to start the attack. First he short-sold the Italian lira, which tumbled. Emboldened, he took on sterling, sending the immense power of his funds, billions of dollars' worth, against the British pound. He shorted, betting that the pound would not be able to hold its value against other currencies traded within the Exchange Rate Mechanism, which seeks to fix the value of European currencies in preparation for a common Eurocurrency.
On Sept. 16, with Soros and others selling pounds, the British government responded by raising interest rates 2 percentage points to attract buyers. Soros saw this as "an act of desperation. It encouraged us to continue selling sterling even more aggressively." He sold all his holdings that afternoon. By evening sterling had been forced from the erm. He scooped up $1 billion from that escapade and became known all over the world as the Man Who Broke the Bank of England.