The Davos Delusion
Two days ago, the 2018 World Economic Forum opened in the Swiss Alpine resort of Davos. Once upon a time, Davos was an obscure and rather remote spot, situated roughly where the borders of Switzerland, Italy, and Austria converge. Thanks to the World Economic Forum, however, it has become famous—so famous that no one any longer uses the formal name of the conclave. “Davos” is enough.
Founded more than 40 years ago by a German-born professor of business at the University of Geneva, Davos was originally intended to introduce American management practices, then thought to be the global creme della creme, to the supposedly sluggish and backward companies and economies of Europe. Gradually, Davos morphed into something far more—nothing less than the premier gathering of the global economic elite, where presidents and prime ministers, bankers and CEOs, economists and academics rub shoulders and congratulate one another on their membership in the world’s most exclusive club. It has become, in effect, the annual convention of the neoliberal economic order, when participants restate, reinforce, and reaffirm their belief in the tenets of global capitalism: the superiority of so-called “free” markets, the supremacy of so-called “free” trade, and the unfettered freedom of capital to pursue profit wherever profit can be found.
By all accounts, the mood at this year’s meeting is nothing less than euphoric. Buoyed by the corporate tax cuts recently passed in the United States, the pundits and panjandrums of Davos are predicting an economic boom, not only in America but in the rest of the world. These expectations will soon be passed down as holy writ to the rest of us by hundreds of sycophantic journalists, who flock to Davos like bees eager to lick up pollen. To the smug, self-satisfied elite who convene at the World Economic Forum, the only world that matters is their world.
No one expressed this conceit better than the political scientist Francis Fukuyama, who, in 1992, published a book called The End of History and the Last Man. Rare for a work so densely packed with sometimes daunting philosophical and historical ideas, Fukuyama’s magnum opus quickly became an international best seller. It also became, for a while at least, the neoliberal equivalent of the Communist Manifesto—to wit, the defining text of global capitalism.
Writing just three years after the fall of the Berlin Wall and the disintegration of the Soviet Union, Fukuyama argued that history had for all intents and purposes come to an end. What he meant by “history” was the long struggle between the two opposing ideologies of capitalism and socialism. With the collapse of the Soviet Union, he claimed, history had declined a winner: capitalism and the liberal democracies that embraced it were on the road to becoming the universal and permanent economic and political system to which all nations would someday evolve.
From where we sit today, scarcely 20 years after Fukuyama’s screed was published, it is hard to believe that his rosy and confident prognostications were ever taken seriously, let alone treated as gospel—for the social, political, and economic institutions he declared to be triumphant are now everywhere under attack or crumbling under the weight of their own contradictions. Indeed, Fukuyama himself recanted his views some years ago, candidly admitting that he not only underestimated the fragility of neoliberal institutions but misread the trajectory of history itself.
Fukuyama’s recantation has done little, however, to cause the Davos elite to confront, let alone question, their own assumptions. As they sip champagne, nibble foie gras crackers, and natter on about Greek debt or the GDP of Uzbekistan, there is little indication that they have even the slightest inkling that their world and the real world are moving in two, radically different directions.
The European Union, which Fukuyama once judged to be the “probable model” for the political future of the planet, is struggling to survive, as some of its most important member states drift toward right-wing authoritarianism. Germany, the EU’s most important and stable member, finds itself on the razor’s edge, after a Neo-Nazi party won an shockingly large slice of the votes in that country’s most recent elections, and the once indomitable Angela Merkel fights for her political life. A majority of the electorate in the United Kingdom, that phlegmatic bastion of global capitalism, have voted to turn their backs on the European Union altogether, opting instead for ethnic and economic isolation. Around the globe, tyrants are rising up like dragon’s teeth; the siren song of xenophobic nationalism is drowning out the voices of moderation and tolerance; the rule of law is being discarded as a nettlesome impediment to the will of autocratic leaders. These include, not only the dictatorial presidents of Russia, Turkey, and the Philippines, but the increasingly authoritarian and lawless President of the United States.
As creative and productive as capitalism undoubtedly can be, it can also, like the Hindu god Siva, be profoundly destructive. Unfettered capitalism turns citizens into mere consumers. It uproots social and cultural traditions that are centuries-old. It transforms human beings into disposable commodities. That citizens and human beings would someday rise up against these depredations was inevitable. What wasn’t inevitable, what didn’t need to happen, was a turn toward nationalism, racism, and autocracy.
The global elite, as they gather on the empyrean heights of Davos, seem blithely unaware of all the chaos down below. Like the Roman Emperor Nero, they appear to be fiddling all the while Rome burns. If they do not soon put aside their fiddling, the conflagration will consume us all.
In 1933, Hannah Arendt, who went on to become a renowned journalist, philosopher, and political thinker, fled Germany, where she had embarked upon what would undoubtedly have been a brilliant academic career, had not Adolf Hitler risen to power. To escape the all-but-certain prospect of extermination at the hands of the Nazis, she left her native land forever. She was only 27.
The Republican Party is about to be granted its most fervent wish, a tax bill that will dramatically reshape the economic and social landscape of the nation. The only hurdle remaining is for the two separate bills already passed by the House of Representatives and the Senate to be reconciled, whereupon Donald Trump will undoubtedly sign the final bill into law.
The allegations of sexual misconduct leveled against Roy Moore of Alabama, who is running to take Jeff Sessions’ seat in the United States Senate, are simultaneously loathsome and ironic. Let’s start with “loathsome.”
Like millions of Americans, I have been deeply depressed and more than a little angry for a year. I simply could not wrap my head around the notion that anyone, no matter how much he or she may have reviled Hillary Clinton, could have been foolish and spiteful enough to vote for Donald Trump. My gloom deepened as the months wore on and it became increasingly apparent that most Trump voters were standing by their man, even as evidence of his boundless ignorance, bottomless narcissism, total unfitness for office, and shameless personal corruption mounted. I began to feel that, if so many of my fellow Americans were so stubbornly gullible, there was little hope for the country ever to recover from the calamity of Trump’s election. It seemed as if a new Dark Age had descended.
In 1960, a Bulgarian-born writer named Elias Canetti published a strange and provocative book, entitled, in the original German, Masse und Macht. Two years later, it was translated into English and published under the title, Crowds and Power. It was difficult then to shoehorn Canetti’s work into any sort of conventional category, and it still is. Crowds and Power is a work that defies tidy classifications. It commingles mythology and anthropology, sociology and psychology, history and philosophy, all the while combining scrupulous analysis with sometimes fantastical interpretation.
When, in the space of a single week, a former Republican President, George W. Bush, and three distinguished Republican Senators, John McCain, Bob Corker, and Jeff Flake, all suggested or, in the cases of Corker and Flake, stated flat out that Donald Trump is unfit to be president and a danger to the nation, the media proclaimed that a “civil war” had erupted within the Republican Party. We were told that Bush, McCain, Corker, and Flake were merely stating for public consumption what countless other Republicans were thinking or saying behind Trump’s back. It was also suggested that a metaphorical dam had broken; that it was only a matter of time before other Republicans would join the chorus of rebuke and repudiation.
Little more than a month ago, Congressman Luis Gutiérrez of Illinois criticized Donald Trump’s chief of staff, former Marine Corps general John Kelly, for refusing to lift a finger to stop the deportation of nearly a million undocumented immigrants who came to this country as children. In a moment of disappointed anguish, Gutiérrez remarked that Kelly was “a disgrace to the uniform he used to wear”. An avalanche of outrage and repudiation immediately came crashing down around the congressman’s head from those on both right and left, many proclaiming Kelly to be a “hero,” whose behavior should and could not responsibly be questioned.
The Trump administration recently unveiled its plan to reform our labyrinthine tax code. It should be said that the words “plan” and “reform” are little more than metaphors, designed to mask a rather different reality. The administration’s plan is nothing but a series of bullet points plucked from a Powerpoint presentation, and its true purpose isn’t to reform the tax code but to provide a massive tax cut for corporations, business owners, and the richest individuals in the land—one of whom, it scarcely needs saying, is Donald Trump himself. Some accounts indicate that the personal benefit of this “reform” to Trump and his family could exceed $1 billion. For many of the major corporations and mega-donors who fund the Republican Party, the windfall would be even greater.