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Tuesday, January 17, 2017

What is the World Economic Forum (WEF) and What Does its Annual Meeting at Davos Accomplish?

Davos, A Not-so-Magic Mountain for the 99%'s Prosperity

According to the WEF website, "The World Economic Forum Annual Meeting in Davos-Klosters remains the foremost creative force for engaging the world’s top leaders in collaborative activities to shape the global, regional and industry agendas at the beginning of each year. For over four decades, the World Economic Forum’s mission – improving the state of the world – has driven the design and development of the Annual Meeting programme..."

Christopher Dickey offers an interesting perspective on this conclave in his Daily Beast article, Davos Man Confronts Trumpocalypse Over Canap├ęs.

Some excerpts:

In the 1970s the World Economic Forum, organized by Geneva University professor Klaus Schwab, put Davos on the map as the site where each January the financial, business, and political elites of the world gathered to network, to see and be seen, and to share ideas about how they’d like to see the planet run.

As it grew and evolved, the event inevitably was caricatured as the place where CEOs arrived on private jets to talk about reining in greenhouse gasses, ate opulent meals and swilled copious quantities of expensive booze while rubbing elbows with do-gooder celebrities like Bono and Angelina Jolie—all the while bemoaning the fate of the starving masses.

Every year they came up with recommendations for policies the world should follow, which they would recommend again the next year when it didn’t. In the meantime, what Samuel Huntington dubbed “Davos Man” did help to push and implement policies that steadily opened the world to big companies, to vast capital flows, to migration flows, and what proved to be the cruel Darwinism of globalization.

For most of the big executives there, Davos was, and is, a place to make more deals face to face with more people much faster than they could anywhere else—then spend a few hours on the slopes or taking in the esoteric offerings on the conference agenda, like a talk Goldie Hawn gave in 2014 about meditation. “I like to improve my mind,” one influential American CEO told me back then.
But, in truth, that wasn’t doing much to improve the world.

Ironically, Klaus Schwab himself was the ultimate Cassandra, warning of doom only to discover nobody would act on his prophecies, when he predicted way back in 1996 in a piece he co-authored for the erstwhile International Herald Tribune that ran under the headline “Start Taking the Backlash Against Globalization Seriously [emphasis mine]."

Twenty-one years later, it reads as if it were written yesterday.
Schwab warned that in many industrial democracies the mood was “one of helplessness and anxiety, which helps explain the rise of a new brand of populist politicians.”

(Kind of gives you a chill when you read that, no?)

The “lightning speed” at which capital moved across borders, the acceleration of technological changes, the rapid evolution of global marketing and management requirements—all strained the existing system “to a breaking point,” said Schwab.

“This is multiplying the human and social costs of the globalization process to a level that tests the social fabric of the democracies in an unprecedented way.”
“It becomes apparent that the head-on mega-competition that is part and parcel of globalization leads to winner-take-all situations,” wrote Schwab. “Those who come out on top win big, and the losers lose even bigger. The gap between those able to ride the wave of globalization …  and those left behind is getting wider at the national, corporate, and individual levels….

“The way transnational corporations have to operate to compete in the global economy means that it is now routine to have corporations announce new profit increases along with a new wave of layoffs,” as Schwab noted.

“Some estimates put at 3 million the number of layoffs since the end of the 1980s in the United States, and more are expected,” said Schwab before penning a line to be remembered: “It is no consolation for a laid-off employee to hear analysts explain how the re-engineering of which he is a victim will help his former employer prosper.”

“Public opinion in the industrial democracies will no longer be satisfied with articles of faith about the virtues and future benefits of the global economy,” he wrote. “It is pressing for action [emphasis mine].”

Schwab’s recommendation was to set national priorities: training and education, overhauling communications and infrastructure, developing policies that gave more incentives to entrepreneurs, and adapting social policies to protect those who lose out. Corporations, too, would have to make sure the “free market on a rampage” did not become “a brakeless train wreaking havoc,” he wrote.

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