Davos is essentially a symbol of crony capitalism camouflaging as a pro-globalization voice.
This year is already witnessing a profound global political instability. Britainâs confusion over the Brexit deal continues, and so do the weekend protests by the gilets jaunes, or the yellow vests, in France. Donald Trumpâs administration is reeling from the longest government shutdown in Americaâs history, while the Chinese economy is slowing down.
Amid these pressing issues, the media attention last week shifted to a small Swiss resort of Davos, where the World Economic Forum (WEF) hosted its annual event.Â The name of the town has become synonymous with the WEF itself. The glitzy invite-only event is attended by over 3,000 decision-makers, top CEOs, civil society representatives and more than 60 heads of state who all come together, traveling in thousands of private jets, to âbuild a better version of globalization.â Every year Davos becomes the worldâs largest concentration of billionaires.
Founded in 1971 as the European Management Forum, WEF is a brainchild of an obscure Swiss business professor, Klaus Schwab. The importance of the meeting gained prominence as globalization spread. The high-altitude setting in one of the worldâs most affluent countries that is a leading safe haven for illicit funds only added to its charm among the jet-setter corporate overlords.
Davos not only emerged as a neutral political platform but also an opportunity for emerging economies to showcase their âeffortsâ in deregulating labor markets and opening up local economies to global investments. The location of the forum ensures that it is mostly free from large-scale street protests seen during World Trade Organization or G-20 summits.
In 2017, President Xi Jinping became the first Chinese head of the state to attend the meeting. In 2018, Indiaâs Prime Minister Narendra Modi gave the keynote address.Â The 2019 gathering was rather low profile. US President Donald Trump, French President Emmanuel Macron, Modi and British Prime Minister Theresa May decided to stay home, prioritizing their domestic concerns.
Every year Davos picks up a new glowing theme that hardly sounds any different from the previous ones. This yearâs hot take was âGlobalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution.â Davos employs a caste system of tiered badges determining access to sessions and segregating attendees into different categories. There were hundreds of vacuous panel discussion on the relevance of globalization and its challenges.
But an inconvenient question remains: Will the powerful Silicon Valley elites and philanthropists-capitalists assembled in Davos hear the angry cries recently raised by working poor in the Champs-ElysĂ©es?
Davos is essentially a symbol of crony capitalism camouflaging as a pro-globalization voice. In recent years, the summit has included social activists, environmental groups and even trade unionists within its folds. But its core group is made of billionaires and multinationals indulging in transnational tax avoidance that fuels global income and wealth inequality.
The annual meetingâs hidden objective is to argue in favor of a corporate-run world and speed up the retreat of the public sector. For this purpose, technology has emerged as their tool of choice. A globalized world now means an interconnected digital world where e-commerce is the new marketplace. Artificial intelligence and automation offer ideal solutions for giant corporations who want to maximize profits and spread their reach without investing in a new workforce. But technology is not creating enough jobs for the low and middle-skilled workforce. The plight of farmers and global debt rising to $244 trillion has no relevancy in the Davos paradigm.
The most usual answer coming out of Davos to every global issue involves words like âtechnology,â âcooperationâ and âmultilateralism.â But the corporate-dominated events wonât explain the barriers that stop dispersion of technology and capital to poor economies. The elite attendees are complicit in these problems. There is a clear disdain for any strategy to clamp down on the tax haven. Meanwhile, the tech giant CEOs at Davos wonât tell how they are spending more money than ever on lobbying politicians.
The recently published WEF Global Risk Report places extreme weather events and climate change at the top of its warning list. But the concern for the environment and climate change among the different tribes of âDavos menâ is limited to extending the role of Western multinationals. No wonder Brazilâs new president, Jair Bolsonaro, who pledged to roll back protections of rain forests and indigenous rights was invited to deliver the keynote address.
The latest Oxfam report claims that last year, 26 people owned the same amount of wealth as the 3.8 billion people who make up the poorest half of humanity. It is in Davos that our political representatives report to the top 1% holding the bulk of global capital. Davos is the collusion of self-serving interests between corporations and politicians undermining representative democracy. The forumâs approach to multilateralism has no issue with Chinese digital totalitarianism or a Trump/Bolsonaro-style nationalism.
The Neoliberal GalaÂ
The kind of resort-capitalism that we see at Davos continues to function without any operational object. The private symposium debating globalization 4.0 remains silent on the excesses of globalization in form of the sweatshops in Dhaka to modern slavery in Abu Dhabi. Similarly, the debates on inequality stay silent on fair wages and work poverty.
This yearâs forum takes place at a moment of growing concern about the risk of another recession. The concentration of wealth in a few hands is the true crisis of capitalism in our times. The slashing of taxes on the rich is happeningÂ everywhere, from France to United States.Â The seasonal corporate doves in Davos have no desire to combat the growing inequality and low wages.
Davos is a congregation of the âchampionsâ in an unsustainable global economic system. Davos regulars are trying to shift the focus of attention from the global threat posed by the expansive monopolistic capitalism. The annual gathering is missing a key point: The attendees cannot close their eyes to the shrinking middle class and growing economic risks. It is only a matter of time before the working-class discontent echoes all the way to their snow peaks. Until then, much like the melting ice, Davos will continue to lose its shine.
*[Updated: January 29, 2019.]
The views expressed in this article are the authorâs own and do not necessarily reflect Fair Observerâs editorial policy.