The global reaction to two landmark new reports suggests the world could well lose that confrontation.
The world’s richest and most powerful will go to great lengths to have a good time. They’ll even pretend they relish waxing philosophical — about humanity’s future and fate.
This past week, at the annual World Economic Forum high up in the Swiss mountain resort of Davos, the pretenders included — for the first time ever — China’s top-ranking leader. Xi Jinping, the Chinese president, turned out to fit in quite nicely. He pronounced Davos 2017 “a cost-effective brainstorming event.”
For the swells who show up at Davos every year, that description rated as pure music to their ears. The awesomely affluent World Economic Forum attendees love to position their annual soirée as a sober and responsible endeavor, a selfless gathering of caring folks “committed,” as the official WEF slogan puts it, “to improving the state of the world.”
How committed? The bankers, CEOs, and hedge fund kingpins who frequent Davos can’t bear the thought of wasting even a moment in transit up into the Alps. No long bus rides on some slow mountain switchback for these noble souls. The 3,000 power-suited participants at Davos this year took nearly 2,000 private jet rides to get there.
Upon arrival these deep pockets found on site an assortment of deep-thinking policy wonks.
Some of the wonks had prepared the annual report that accompanies each year’s forum. This year’s edition, The Inclusive Growth and Development Report 2017, dares to detail how economic inequality has increased to the point where those who argue that “modern capitalist economies face inherent limitations” have yet to be “proven wrong.”
Other policy wonks on hand at this year’s Davos gala not so subtly hinted that deep pockets worldwide might soon have to start seriously paying up at tax time.
“There may just be a need to man up,” economist Richard Baldwin opined. “We have to pay for the social cohesion that we need to keep our societies advancing and accept that this may be a higher tax burden on people.”
Politically savvy leaders at Davos took care to stay on the same self-sacrificing script. In a Wednesday panel on “Squeezed and angry: how to fix the middle-class crisis,” International Monetary Fund managing director Christine Lagarde told her wealthy listeners that any serious fixing of the middle class would probably have to mean “more redistribution than we have at the moment.”
But the wealthy at Davos can take the pretending they care — about the rest of humanity — only so far. They’ll gladly agree to reduce inequality, as one astute Davos-watcher notes, so long as they can “hang on to everything they have.”
At the panel with the IMF’s Lagarde, hedge-fund billionaire Ray Dalio put the matter baldly. If you want to invigorate the middle class, Dalio advised, start axing regulations on business and “create a favorable environment for making money.”
India’s richest man, Reliance Industries CEO Mukesh Ambani, could hardly have agreed more.
India’s billionaires — less than 1 millionth of India’s 1.33-billion population — currently hold 58 percent of that nation’s wealth, the global nonprofit Oxfam reported last week.
For those Indians who might consider that distribution of wealth a bit untoward, another Indian CEO at Davos, Abidali Neemuchwala, had a recommendation: stop whining and get yourself more skills.
“People,” the corporate chief pronounced, “have to take more ownership of upgrading themselves on a continuous basis.”
Not too many of this year’s Davos-goers, to be sure, likely heard the “wisdom” that Neemuchwala — or any other speaker at the World Economic Forum — had to impart. The deep pockets at Davos have a notorious reputation for ignoring the innumerable panel presentations that dot the Forum agenda.
The awesomely affluent attendees at Davos, says former banker — and current Davos critic — Satyajit Das, “regularly skip sessions — other than ones where they want to be seen.”
But the typical “Davos man” hardly ever takes a pass on the Davos party scene. The resort’s plush hotels go all-out to keep their well-heeled guests feeling welcome — and coming back year after year.
At World Economic Forum time, the fanciest hotel in town, the Belvédère, quadruples its staff to 400. The goal: to cater to the “every whim” of the world leaders, business execs, and assorted other super rich who make their way into the Alps.
Among the added Belvédère staff: baristas, cooks, waiters, doormen, chambermaids, receptionists, and, notes the hotel general manager Thomas Kleber, “specially recruited people just for mixing cocktails.”
Davos has no real room for all these support staffers. Last week the imported help had to sleep five to a room in quarters the hotel had outfitted with bunk beds. They probably don’t get to sleep all that much. Davos parties and receptions routinely go on into the wee hours.
The flashiest party of them all, word has it, takes place at a nearby mountain chalet owned by Russian billionaire Oleg Deripaska and British financier Nat Rothschild, a blowout one visitor has described as “endless streams of the finest champagne, vodka, and Russian caviar amidst dancing Cossacks.”
Also highly regarded on the Davos party scene: the always well-attended bash hosted by the American hedge fund manager Anthony Scaramucci, soon to be a top aide in Donald Trump’s White House “office of liaison.”
Who knows, if Scaramucci proves good at his liaison labor, maybe his new boss himself will show up next year at Davos.
Institute for Policy Studies associate fellow Sam Pizzigati co-edits Inequality.org. His most recent book: The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900–1970. Follow him on Twitter @Too_Much_Online.