EDITORIAL: Can ‘fat cats in snow’ deliver economic justice?
One thing that the organisers of the World Economic Forum 2019 meeting, which started in Davos, Switzerland, on Tuesday, do not lack, is ambition.
The title says it all. It’s a bit of a mouthful: Globalisation 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution. Lots of words that can mean many things to many different people.
That’s also reflected in the diversity of the audience. The organisation has come a long way since 1971, when a University of Geneva business professor, Klaus Schwab, founded what was then known as the European Management Forum, as a nonprofit foundation based in Geneva.
Its ambitions were more modest in those days: to bring in business leaders to debate how the region’s firms could catch up with the US, the undisputed economic powerhouse and leader of the “free world”.
There’s no denying that at Davos the balance of power is shifting.
It’s not without irony that the US is nowhere to be seen. On the eve of the meeting, President Donald Trump abruptly cancelled the American delegation’s trip, citing his argument with the Democrats, who won’t fund his border wall.
That in itself is ironic enough — cancelling a trip that ostensibly has as its main goal the promotion of global cooperation over a wall that’s supposed to separate the US from its neighbours.
That’s not to say the US won’t have some sort of presence. Secretary of state Michael Pompeo was due to address a session by video link. The initial session was to discuss the role of American leadership.
Britain’s prime minister, Theresa May, is also not in Davos, bogged down by conflicts at home over Brexit, another project, despite protests to the contrary, that also has at its heart a retreat from a global leadership role. France’s leader, Emmanuel Macron, is also staying at home, consumed by the “yellow vests” protest that started in November.
In some ways, it feels that the World Economic Forum this year is taking place at a time when the traditional leaders of the global order are all, for one reason or another, turning more inward. But life must go on, and those who are represented are showing a determination to forge ahead.
From musician Bono’s characterisation of the meeting as a gathering of “fat cats in the snow” to the “Davos man” moniker, the gathering hasn’t always garnered broad support and it will take more time to shake the perception that it’s just a talkshop for the rich and famous.
But it would also be unwise not to recognisehow much has changed. For one thing, the dominant delegation that everyone is looking at is from China, not America. Representation from “emerging economies” more broadly is at record levels.
Whether that will mean concerns of developing countries will get more attention, it remains to be seen. But there’s no denying that the Davos balance of power is shifting.
That’s also reflected in the subjects on top of the agenda — from global warming to extreme weather events, the need to improve health systems, and the technological revolution —which have a disproportionate impact on poor countries that are less able to take steps to mitigate the damage, and the workforce is less.
With a nod to the West, where the perceived failure of globalisation, especially in the light of the financial crises that started to break out a decade ago, there’s also more focus on how to challenge the resentment and hopelessness that has given to rise to populism.
It’s not about altruism either. From politicians to business leaders, there’s a growing recognition that there are limits to what the markets can achieve.
Among the developed nations, the UK and the US staged impressive recoveries from the crisis, but that still didn’t create enough welfare gains to fight the idea that there was a disconnect between economic growth on the one side, and the well being of society as a whole.
The World Economic Forum says its motto is to improve the state of the world. Who can argue about that?
The question that will linger long after the fat cats have left is whether the forum is the right place to reinvent a new global order for peace and prosperity.
But a start has got to be made somewhere.