Latest gibberish from Davos shows what the people who caused populism plan next
Have you packed your suitcase for Davos? What do you mean you haven’t been invited to this year’s annual love-in for the business and political global elite and assorted hangers-on that takes place in Switzerland later this month?
That’s a shame, because you will miss an event that provides an unintentionally hilarious reminder of why Donald Trump won the presidency, why the naughty Brits voted for Brexit, and why the populists in general are winning.
The backlash was stimulated by the arrogance of the elites who accumulated power and delivered the financial crisis a decade ago and prospered in the aftermath. That combined with concerns about the erosion of national sovereignty and accountability, expressed most obviously in the response to the migration crisis. It produced what has been termed populism, some of which is unpleasant or rough in character, though the “p-word” has since become a catch all term for any development not to the liking of centrists who have been losing or to the left.
For a flavour of what Davos will be about this year I recommend reading the latest gibberish penned by the founder of the World Economic Forum.
Klaus Schwab’s message sent to those attending is full of silly buzzwords, obviously. In “Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution” he even writes of the need for “smart-ization”. The World Economic Forum he runs is, he says, the “foremost global multistakeholder platform” and he believes it has urgent work to do.
Schwab writes: “We need a new framework for global cooperation in order to preserve peace and accelerate sustainable progress.”
Considering the extent of public anger in major democracies over what a mess the globalists who were in charge of the existing framework have made of things it takes quite some cheek for a globalist guru to attempt to take the lead on next steps. It is useful though to hear what that crowd have in store for the rest of us next.
In one sense, in terms of sheer chutzpah, you have to hand it to Schwab. What an operator the guy is. He invented the Davos gathering in 1971 (it became the World Economic Forum in 1987) and it has grown to become a magnet for the powerful who want to signal that they are dedicated to improving the world, between attending parties in the snow with the latest hot DJ from Berlin and assorted lobbyists hoovering up Bollinger by the magnum. Unfortunately, rather than just admitting that for most attendees it’s really a massive jolly and a chance to network and show off, many of those involved persist in pretending there is a higher purpose or it is about diversity or something.
Now these people are, Klaus says, going to sort out “Globalisation 4.0”, apparently. Perhaps the twittish President Macron – the most Davos person since Tony Blair’s career disappeared down the u-bend of history – could lead on this “going forward”, as they say.
But hold on. Globalisation 4.0? Back on Planet Earth, the rest of us are still arguing about the political impact of globalisation 2.0, the period since the fall of Communism, globalisation 1.0 being surely the technological and trading expansion of the late 19th century in which Britain played a leading part.
Voters are still angry about the backwash from the latest round of globalisation. It has brought benefits, but at a cost that concerns many voters worried about identity, distribution of the spoils and fairness. They have voted accordingly, not because the populists have all the answers. They do no not. The shambolic course of Brexit and the unorthodox and destructive behaviour of the Trump administration demonstrates that the populists certainly do not have a clear plan. Nonetheless, sufficient voters (not always a majority, but enough to cause trouble) like that someone is disrupting the setup at last. If the senior end of the corporate management class, Mr and Mrs Davos, have their plans and systems disrupted then – even if it hurts the rest of us a little – that’s refreshing and good.
But beyond emitting a howl of rage and seeking the extraction of a small measure of revenge, what’s the way forward? If there is to be a coherent response to the earthshaking economic and political developments through which we are living, all manner of genuinely serious questions about the future of markets and democracy need addressing.
How can we break up the new giant global monopolies such as facebook? What laws are needed?
Why is crony-capitalism out of control and how can the case for genuine markets be remade? Pro-market people like me have been talking about this for a decade and hardly anything concrete has changed in law or policy.
What reforms are needed to the tax system more generally and to the wider political system?
Can top managers in companies please stop paying themselves so much when they take little or no personal risk? Their selfish behaviour risks a revolution, or at least a backlash letting in the anti-freedom far left.
Yet before these questions have been dealt with to the satisfaction of national electorates, the globalist class is gearing up for another go at advocating yet more globalism and seeking power for itself. That’s the real message of this year’s Davos agenda. Underneath all the bumbling and the buzzwords, at the heart of the Schwab memo there is a serious and rather chilling point.
He’s no fool, really, old Klaus He finds a deft way of saying that, next up, there is about to be a jobs-shredding revolution and for his class this is a chance to take yet more power, all the while nodding to diversity and using the bogus heal the world, imagine no possessions, rhetoric favoured by progressive plutocrats.
“The impact of the 4IR on our economic, social, and political systems will be truly transformative” Klaus writes.
“The physical world will shrink in comparison to a new interconnected digital world. This de-materialization of the economy will be accelerated by a transition into a circular and a shared economy, enabled by the 4IR. Manufacturing will be revolutionized by automation, localization and customization, replacing traditional supply chains. Employment and income patterns will be transformed as large parts of employment are substituted by intelligent automation. Traditional labour income will be extensively replaced by accrued returns from creative tasks, venture capital and first-mover advantage. This will require reformation of the tax systems.”
Economic disruption, creative destruction, is an essential component required for innovation and economic development, of course. But it is not the sole component and if it becomes an end in itself, and this looming experiment is unleashed on already stressed societies without proper care and attention, one shudders to think of the implications for tens of millions of people and for the stability of our societies.
Incidentally, there’s a bogus conceit central to the Davos corporate shtick in which the architects of this disruption – the owners, CEOs and senior managers – talk as though the next disruption is nothing to do with them although they instigate, enact and promote it! They do – or should have – agency and moral responsibility to the societies in which they dwell and to their workers.
Klaus being Klaus he thinks he has the answer to this pressing dilemma and – who would have thunk it? – it’s yet more globalism. The next Davos agenda is, he says, about “global dialogue” over this revolution, leading to new global rules and new global institutions. Globalisation causing populism and elite discomfort? Let’s add robots, mass unemployment and more power for globalists.
Is there a better response available to the turmoil? If there is I suspect it lies in the regeneration of the nation state and in an understanding that it is effective. People want borders controlled. They are right. Immigration is positive, but scale, equity and speed matters. None of this is crude nationalism – or about a desire to fight with anyone, although sometimes we have to – but a nation when it works is simply a successful expression of community and the concept of shared endeavour.
There must be international cooperation, on subjects such as defence, aid and the environment. But if these efforts are elevated and increase until people feel they are being taken for fools and have no control, we’ll get more populists, or something much worse.