Why I don’t like Davos

This week the ‘great and the good’ of the planet are convening in Switzerland.

This week the ‘great and the good’ of the planet are convening in Switzerland.

In Davos, in case you’ve missed the news, for the World Economic Forum. It happens every January. And each year the world’s media hangs around the assembled company of financial and other glitterati, reverently awaiting any pearls of wisdom that the latter may care to dispense.

Am I one of the fans? No way.

In fact, I hate the whole Davos event. Here’s why…

It’s nothing personal

First, let me make one thing very clear.

I’ve no beef with the populace of Davos itself. For one thing, I’ve never been there. But Wikipedia says it’s a town in the Swiss Alps that in winter is a popular ski resort, while summer activities include swimming and sailing on Lake Davos, hiking and mountain biking. The Glacier Express train connects Davos to the Matterhorn.

Sounds like fun.

But in January, Davos becomes the power base for the World Economic Forum (WEF). This was founded in 1971 by German business professor Klaus Schwab to enable European corporate leaders to learn from their US counterparts.

Political leaders started attending later in the 1970s. And now the WEF has become an annual boondoggle, attended by the global elite, to discuss the planet’s problems.

The theme this year is “Creating a Shared Future in a Fractured World”.

Panel discussions will revolve around the ‘Fourth Industrial Revolution”, equipping today’s workers for the advent of automation and artificial intelligence, deciphering fact from fiction in the age of ‘fake news’, exploiting machine intelligence in health and combating the next pandemic, dealing with high-flying financial markets, and also looking at the future of food, reports RTE.

And those are all just on the first day.

2018’s version has 2,500 delegates and 70 world leaders. European politicians such as Theresa May, Angela Merkel, Emmanuel Macron, Italy’s Paolo Gentiloni and Irish PM Leo Varadkar will be there, along the Brazilian and Argentinian presidents, many industrialists and bankers, Harvard psychologist Steven Pinker, Pakistani Nobel Peace Prize winner Malala Yousafzai, Elton John and Cate Blanchett.

The list goes on and on.

And it wouldn’t be a show without Punch. Donald himself is due to close the conference with a speech on Friday. That will mean the inevitable rent-a-mob protesters, so 4,000 Swiss soldiers and police have been drafted in to keep the peace.

So why do I dislike Davos?

For starters, it’s another PR fest for so-called celebrities.

The world has enough of these without Davos. Much of the time the WEF appears to be just a lot of very wealthy people nibbling caviar and quaffing champagne with other even-wealthier types.

Sure, that’s their prerogative. But please do it behind closed doors!

If Davos produced something genuinely novel or beneficial to the human race, then fair enough. But history shows that it generally doesn’t. There’s very little added value. And the people who make the Davos soundbites are always doing so whenever they can elsewhere. They don’t need to stay in a very expensive Swiss ski resort just to repeat the same message.

“The belief that doing interviews with people bundled in furs with a picturesque backdrop is somehow more effective than a normal interview, or necessary to convince the viewer that you are in fact in Davos, seems bizarre”, says Peter Tchir in Forbes. “The ‘holier than though’ list of topics gets tiring…and being preached at from a glamorous location – with off-the-charts entertainment for the guests – gets tiring very quickly.”

Indeed, I see much of the Davos output as highly patronising. A degree of inequality amongst mankind isn’t a bad thing. It’s an inevitable result of financial incentives.

There’s something deeply hypocritical about all the ‘rectifying inequality’ talk by so many rich people, many of whom have made it their business to create such an extremely unequal world in the first place.

And I don’t buy the stuff about current global inequality showing that ‘capitalism isn’t working’.

Quite the opposite, in fact. It simply hasn’t been allowed to operate properly by many of the people who are now holed up in Davos.

When the global financial system was on the brink of falling apart 10 years ago, letting the free market work would have allowed many banks to go bust.

All the perpetrators of the crisis would have been fired. Instead, they managed to con governments and central banks into bailing them out with even more money.

Since then, global monetary policy has been geared to ensuring that major asset owners have got much richer while most of the rest of us haven’t.

Meanwhile, the planet is drowning in much more borrowing than it was 10 years ago, as I recently noted in Daily Reckoning.

To repeat, many of the architects of this debt mountain are enjoying themselves at Davos. Why should we expect them to react differently when the next financial crisis happens (as it surely will)?

Much more likely is that, as the global financial elites chat in private dinners and meetings away from the cameras, they’ll be plotting exactly how to enhance their own wealth even further – regardless of what happens to the rest of us.

Apparently, this year’s mood at the WEF is the most bullish for a decade.

That alone is enough to make me worried.

To sum it up, I believe that Davos is at best a distraction. At worst, it’s where the next set of plans are being made to separate us from our hard-earned cash.

Paranoia? We’ll see. Anyway, that’s my rant for today done.

I’ll get my coat…

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