Article / 27 January 2016 at 14:30 GMT

What do they believe in Davos?

Head of Editorial Content / Saxo Bank
Denmark
  • Davos forum sees world leaders discuss technological, cultural trends
  • 2016 meeting emphasises coming jobs shortage, social stratification
  • Diversity a must given likelihood of mass labour movements: WEF
  • Forum consensus currently meeting popular resistance on multiple fronts

By Michael McKenna

Last Saturday saw the conclusion of the 2016 World Economic Forum in Davos, where 2,500 political and business leaders, intellectuals and journalists met to discuss our common circumstance. In many quarters, the idea of the rich and powerful meeting in a protected Alpine enclave to “shape global, regional and industry agendas” (this is from the WEF’s own mission statement) might prompt fears of conspiracy. In order for conspiracies to be successful, however, the elite must not only meet but collude — and to collude they must agree.

What do the mandarins of our age agree on? The theme of this year’s WEF summit was “Mastering the Fourth Industrial Revolution”, a term the Swiss non-profit uses to describe the “fusion of technologies that is blurring the lines between the physical, digital, and biological spheres”.

The difficulty of this era, states the WEF, is its exponential rate of change; will this familiar array of pre-singularity circumstances provide what the forum terms a “supply-side miracle”? Or will it “increase social tensions” as the job market shrinks and segregates into neo-feudal extremes of “low-skill/low-pay” and “high-skill/high-pay” positions?

This latter fear lies particularly close to the WEF’s heart as a series of events on the ground, from Donald Trump’s presidential candidacy in the US to the deteriorating refugee/migrant (the terms have become politicised; choose as you see fit) situation in Europe, appear to point to a degree of popular frustration with the seamlessly globalised future that Davos types would prefer to extrapolate from extant trends.

How does the FutureTM deal with its discontents? In the US, Donald Trump’s presidential candidacy is riding high on a nationalist platform that includes a dramatic scaling back of immigration both legal and illegal and a call for US firms to manufacture their goods domestically. This suite of ideas, despite flying directly in the face of longstanding rhetorical and economic trends, is finding support among working class voters who see themselves as ill-served by this fourth revolution (and who may or may not desire a fifth).

Donald Trump campaign hat
WEF chair Klaus Schwab says "the sovereign state has become obsolete", 
but The Donald disagrees. Photo: Wikimedia Commons

Similarly, the massive influx of Middle Eastern and African refugees and migrants into Europe launched by Germany’s decision to waive the Dublin laws last summer is seeing a dramatic decline in popular support as the focus switches from macro-scale benefits (a boost to the working-age population) to micro-scale problems (crime, disorder and alleged media collusion).

On multiple fronts, it would appear, the developed world is shying away from the consequences of its economic layout. The globalisation of manufacturing has alienated the Western working class, social stratification is creating mutually exclusive political blocs whose proposals cannot but horrify their opponents, and we remain stubbornly willing to divide ourselves by non-economic means (economic divisions, chez WEF, are perhaps regrettable but not entirely infra dig) such as nationality, race and sex.

So how do the members of the WEF see us navigating the array of dispossessions and opportunities that characterise the fourth industrial revolution? If the forum’s goal is, as stated, “to improve the state of the world”, then how does it plan to do so?

The future is… diverse 

Despite the rumblings on the ground, the WEF remains committed to a world in which people of varied backgrounds, faith traditions and other traditional (read: non-economic) dividing factors live and work alongside one another.

"We need societies that recognise diversity as a source of strength," said Canadian prime minister Justin Trudeau while US vice-president Joe Biden dismissed concerns about clashing cultural traditions in his trademark fashion by noting that “people used to be cannibals as part of their culture, people used to do terrible things”.

According to MasterCard executive director Shamina Singh, “to innovate, you need to have people of different backgrounds”. Building on this point, Beth Brooke-Marciniak of EY spoke of how large companies could aid the development of this circumstance, telling WEF attendees that “if the private sector is leading inclusive cultures within the walls of their companies, they can lead the cultural change in society to create a more inclusive society”.

Sounding a dissenting note, however, was Dutch finance minister Jeroen Dijsselbloem who told his Davos audience that the numbers of migrants entering Europe must be reduced. “We need to get it under control, we need to get the numbers down… the numbers that we are taking in in Europe cannot go on. It’s becoming disruptive”.

Connoisseurs of management-speak, of course, will note that given the positive connotations accrued by the term “disruptive” of late, there is no real (in 2016 terms) conflict between Dijsselbloem’s panic and Singh’s call for innovation. Outside of this limited context, however, the Dutch minister’s speech provided a rare note of caution.

Interestingly, one of the very first quotes released from Davos came from WEF head Klaus Schwab, who spoke to Bloomberg days before the conference opened. According to Schwab, low commodity prices and the replacement of important jobs by technology could launch a wave of migration that makes last year’s influx look like a mere trickle.

“Look how many countries in Africa, for example, depend on the income from oil exports – now imagine 1 billion inhabitants, imagine they all move north” said Schwab. 

Viewed through this lens, the forum’s intense focus on the benefits of diversity appears more pragmatic: the people are there, the jobs increasingly are not. As such, the future must focus on sources of strength, innovation and "inclusive cultures". The choice is not between inclusion and non-inclusion, or innovation versus stagnation; it is between these words and famine, these ideas and war, these policies and butchery.

It is useful to remember that global leaders, while powerful, are generally trapped in a vice and backed against a wall. They are, as this year’s “revolution” theme makes clear, merely the conduits through which vast historical and technological forces impact the world and its people.

Syrian refugees at Budapest Keleti
Middle Eastern refugees fleeing the innovations enacted in and over their homelands rest at Budapest's Keleti station in the summer of 2015. Photo: Wikimedia Commons

The future is… digital

“For many people, a smartphone is the first and only computer they have”, said Lloyd’s CEO Inga Beale, underscoring the profound focus this year’s WEF placed on the digital world. A smartphone, of course, is a portable device with which one can access the internet whenever one wishes. Usage patterns suggest that said wishes occur frequently. Thus, the internet as a tool, a cultural space and a vehicle for worldviews is more important than it has ever been.

The WEF concurs, stating that “neither technology nor the disruption that comes with it is an exogenous force over which humans have no control. All of us are responsible for guiding its evolution”.

Increasingly, “the internet” has come to mean social media. In 2016, states Statista, it is expected that 29.1% of the world’s population (and nearly 70% of internet users) will be accessing social networks. In developing countries, the trend is even more apparent as mobile data availability is scaled up to meet demand (1GB of data per month now costs less than 5% of the average income in 111 countries) with India now Twitter’s fastest-growing market as internet usage grows by 37% year-over-year.

In Nigeria, reports Hootsuite, 65% of internet users think Facebook is “the internet”.

Given the global nature of these platforms, their interest to WEF attendees is obvious. Facebook, to use a market-leading example, has become a platform for all sorts of contending views, from the benign (“bacon is the best!”) to the more controversial (“ISIS is the best”). At Davos, Facebook COO Sheryl Sandberg told attendees that while it is difficult to halt the posting of the latter sort of view, such messages can be outweighed by mass efforts to spread "tolerance and messages of hope".

To illustrate her claim, Sandberg used the example of Germany’s far-right NDP party, whose Facebook profile was the site of a targeted operation led by a German anti-fascist group. “Rather than scream and protest”, said Sandberg, “they got 100,000 people to like the page […] and put messages of tolerance on the page”.

While this may be interesting as a localised activism strategy, even the WEF recognizes that extremism goes deeper than a perverse individual inclination towards hate rather than its opposite. Instead, the forum sees the “hollowing out” of the world jobs market and extreme income stratification as the true drivers behind the spread of “extreme ideas and ideologies” on social media.

While Sandberg’s Davos speeches were longer on pro-tolerance messaging than specifics, Facebook has recently taken some more decisive moves towards this goal than the “flood of likes” suggestion implies.

On January 15, Reuters reported that Facebook has hired a division of the Bertelsmann media house to “monitor and delete racist posts”. The move follows a lawsuit filed against Facebook in Hamburg last November charging that the social media firm violated the country's tough laws against promoting hate speech.

According to Reuters, “German politicians and celebrities have voiced concern about the rise of anti-foreigner comments on Facebook and other social media as the country struggles to cope with a tide of new migrants”. January, it must be noted, saw an enormous uptick in immigration-critical messages after the New Year’s celebrations in Cologne were marred by hundreds of sex attacks, including gang rapes, that witnesses described as committed by gangs of migrants.

The attacks’ impact on Germans’ view of chancellor Angela Merkel’s immigration policy was intensified by claims that the national media attempted to downplay or even cover up the nature of the attacks, with public broadcaster ZDF publicly apologising for not including the event in its main evening new broadcast and former interior minister Hans-Peter Freidrich accusing media of imposing a “news blackout” and operating a “code of silence” over negative news about immigrants.

Angela Merkel
"What did they call me?" Photo: iStock 

Given this context it is perhaps inevitable that Facebook’s anti-hate speech efforts will be viewed with suspicion, with even fairly middle-of-the-road outlets such as The Sociable wondering whether the move will limit online discussion of the migration crisis itself – and the policies that made it possible – under the guise of promoting tolerance.

Perhaps it is not enough to state that the future is digital. Perhaps the future was digital in 1995, but now that the digital part is a given the real questions concern the policies of those firms that have been graced with digital-era centrality.

By pairing social media and extremism in its “Fourth Revolution” statement, the WEF recognises that smartphones can be both a means of participating in and dissenting from the FutureTM. In choosing Germany as the site of the most far-reaching speech-policing effort yet undertaken by a social media firm, Facebook is positing European xenophobia as a Western cousin to the military efforts of ISIS (Sandberg’s NDP example was actually given in response to a question concerning ISIS recruitment).

Facebook is absolutely right insofar as both phenomena rely on non-economic divisions between individuals, racial and religious in these respective cases. These divisions are anathema to the Davos worldview even as they persist among actual people.

How will the fourth revolution, then, deal with identity?

The future is… female

The most intractable of the many non-economic divisions between individuals is sex. To list the cultures that have instituted different behavioural mandates for men and women is to confront something very close to the entirety of our history. There is arguably no country, company or trade bloc whose makeup does not reflect this divide to one degree or another.

The WEF’s position on divisions is that they are costs. While the forum itself was taken to task for its lack (17%) of female attendees – the Guardian, for instance, called Davos “both a victim and an indicator of its surrounding reality” – this year’s WEF speakers were near-unanimous concerning the need for parity in this regard.

Referencing the trend of networked appliances, International Monetary Fund head Christine Lagarde told Davos attendees that “we’ve heard a lot about the ‘internet of things’ – I think we need an internet of women”. Continuing in this vein, Facebook’s Sandberg took a sort of planetary macro view and stated that “men still run the world; I’m not sure it’s going so well”.

Historically speaking, the running of the world is not something that is apportioned according to merit; power of this sort instead changes hands following violent upheavals. So what is the WEF’s view on rectifying this imbalance, given that “Mastering the Fourth Industrial Revolution” essentially means traversing a whole series of upheaval-favouring circumstances without enduring upheaval?

When newly elected Canadian PM Trudeau took power last year, he insisted on a 50/50 split between men and women in his cabinet. His justification was chronological: “It’s 2015”, he said. Speaking at Davos, he elaborated on the popular move by noting that while his quota-based solution sparked a degree of initial opposition, this faded once his team was unveiled.

"Nobody talked about merit anymore because the people in our cabinet — men and women — are extraordinarily high-qualified," he said.

The WEF’s view on sex parity is essentially the same as Trudeau’s, holding that “policies to promote women’s economic integration” – usually quotas of one sort or another, but also including initiatives to subsidise maternity costs – need not prove divisive due to the depth of the talent pool among women. To this end, in fact, the forum maintains a “Gender Parity Programme” that “monitors the progress of countries through benchmarking tools that measure global and regional gender gaps”.

Economically oriented forums such as the WEF have an obvious interest in promoting sex equality. As the forum’s Global Gender Gap Index states, “ensuring the healthy development and appropriate use of half of the world’s available talent pool thus has a vast bearing on how competitive a country may become or how efficient a company may be”. 

This outlook was succinctly expressed on social media (of course), with the WEF tweeting that “anyone with a decent brain must know it’s better to hire from 100% of the population” and “if you had parity of employment in Africa you would raise GDP by 12%” last Sunday.

While a global, Sandberg-style power grab by women and from men may be improbable, one by states and blocs that favour WEF-style views from others who retain traditional structures (read: non-economic divisions) is not. After all, while Trudeau’s cabinet launch soundbite may have resonated in Canada and similar places, the world experienced many different 2015s. In Saudi Arabia, for instance, 2015 marked the first time women were allowed to vote – a milestone passed by Canadian women in 1918.

This remains one of the largest challenges faced by the WEF and other such globally-oriented forums. Policy shifts that require slight legal changes or social media campaigns in one region might require the toppling of entire regimes in others. The attendees of the 2016 WEF certainly have the collective firepower to do just this, but the goals of an economic forum hardly represent a mandate for this sort of action.

Military solutions
"You are in violation of the speech that a lot of people were quoting 
on Twitter last Saturday." Photo: iStock 

The future is uncertain

Policies are expressions of power, and power is the shadow of violence suspended. This is what concerns critics of Davos-type summits (Bilderberg, WTO, World Bank…), who allege that the hallways and conference rooms of such events play host to far more that is tweeted to the public or covered by reporters (most of whom, after all, are only issued lowly orange badges rather than the access-granting white ones enjoyed by speakers, CEOS and certain high-level publishers).

While nothing in the nature of either power or personality precludes this, the “collusion in high places” narrative often grants its subjects an omnipotence that they may covet but do not possess. After all, says historian Niall Ferguson, “Davos Man” thought the Arab Spring was “the dawn of a wonderful new era” in 2011. In 2009, he adds, conference attendees were certain that the US was entering a second Great Depression just as the financial crisis approached its nadir.

It is interesting and necessary to speculate on what hidden measures world leaders may use in order to bring global templates like the FutureTM closer to reality. Speculation, however, must follow analysis, and analysis depends on the materials made public.

Besides, the transnational class is not nearly as circumspect as one might think.

So what do they believe in Davos? According to WEF head Schwab, “we stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another”. This revolution, the 2016 forum’s mission statement continues, will suffuse the whole of humanity with a network of informational, commercial and robotic connections. 

At the same time, it will remove more and more of the methods by which we have traditionally sustained ourselves, creating an economy characterised by “low-skill/low-pay” and “high-skill/high-pay” extremes – a feudalism of training, education and access.

While the connections between us will “increase the efficiency and pleasure” of the latter’s existences, they will also provide a platform for spreading and aggregating the anger of the dispossessed. While technological improvements might “flatten” (to borrow Thomas Friedman’s term) differences within classes, they could also increase the distances between them and hinder one’s ability to move from one to the next.

Rather than Friedman’s “flat” world – the fabled level playing field – we might instead see a hierarchy of flat platforms, separated by resentment and rage.

Sympathetically viewed, the WEF’s solution is essentially to remove barriers to mobility and individual economic participation. In such a world, the rapid movements of jobs and resources would be matched by large-scale population shifts, with individual actors “going where the getting’s good”. The traditions and incompatibilities that presently complicate such movements, it is hoped, will dissipate, helped along by diversity-favouring policies. 

We will abandon those non-economic divisions – those traditions – that we can no longer afford. We will streamline and blend our cultures so as to best make use of the shrinking (due to non-human incursions) fruit of our collective labour.

That is to buy in. For those who are unable or unwilling to do so, the FutureTM will more likely resemble a sort of Jupiter, with a sleek, storm-polished core surrounded and dwarfed by layer after layer of roiling clouds.

Because it may not work. It may not be possible to engineer painless deaths for traditions, religious practices and self-definitions that fall outside the realm of WEF acceptability. It is plausible that surrounding the human drama with a rickety array of redistributive, Western-sponsored scaffolding will not prove equal to the task of ending inequality, particularly as the larger trends bring more and more of it our way.

It is conceivable that offering opportunities to people from traditionally underrepresented groups, even on a mass scale, will do nothing to address the underrepresentations of the new caste system.

The mandarins of the WEF know this, of course. When you parse the public statements from this year's conference closely, it becomes fairly obvious that beneath the outer layer of idealism lies a solid wall of fear. The world is heading in an unprecedented direction, and the coming years and decades will provide challenges of a type and scale we have not yet endured.

The question left is to what degree you identify with the speakers at Davos. Because they are saying, in so many words, that the FutureTM presented at this year’s conference is our only hope.

It is certainly theirs.

Bran Castle, Transylvania, Romania
"Sign up now for the 2020 WEF, which will be held in scenic, 
secure – very secure – Bran Castle, Transylvania". Photo: iStock 

Michael McKenna is an editor at TradingFloor.com

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