Davos: responsible capitalism

Michael Roberts.

Today, the global political and economic elite meet in Davos Switzerland under the auspices of the World Economic Forum (WEF).  Every year the WEF has an annual meeting in the super exclusive ski resort of Davos, with the participation of 3,000 politicians, business leaders, economists, entrepreneurs, charity leaders and celebrities.  For example, this year Chinese president Xi Jinping, South Africa’s Jacob Zuma and many of the economic mainstream gurus and banking officials are among the attendees. Xi Jinping will be the first Chinese president to attend Davos and will lead an unprecedented 80-strong delegation of business leaders, economists, academics and journalists.  He will deliver the opening plenary address on Tuesday and use it to defend “cooperation and economic globalisation”.  

US vice-president Joe Biden, China’s two richest men and London mayor Sadiq Khan will travel on private jets to nearby airports before transferring by helicopter to escape the traffic on the approach to the picturesque town. So many jets are expected that the Swiss government has opened up Dübendorf military airfield, an 85-mile helicopter flight away, to accommodate them.  The increase in private jet flights – which each burn as much fuel in one hour as typical use of a car does in a year – comes as the WEF warns that climate change is the second most important global concern.

While the rich elite fly in on their private jets, extra hotel workers are being bussed in to serve the delegates, while packing into five a room in bunk beds.  One of the main themes of Davos will be the rising inequality of income and wealth.  So Davos itself is a microcosm.

At Davos’ super luxury hotel the Belvedere, there will be “specially recruited people just for mixing cocktails”, as well as baristas, cooks, waiters, doormen, chambermaids and receptionists  to host world leaders, business people and celebrities, who this year include pop star Shakira and celebrity chef Jamie Oliver (worth $400m).  Last year, a Silicon Valley tech company was reportedly charged £6,000 for a short meeting with the president of Estonia in a converted luggage room. The hotel has also previously flown in New England lobster and provided special Mexican food for a company that was meeting a Mexican politician.

Britain’s Theresa May will be the only G7 leader to attend this year’s summit as it clashes with Donald Trump’s inauguration as the 45th US president.  Last year, former UK PM David Cameron partied tie-less with Bono, Leonardo DiCaprio and Kevin Spacey, at a lavish party hosted by Jack Ma, the founder of internet group Alibaba and China’s richest man with a $34.5bn (£28.5bn) fortune. Tony Blair also attended the Ma party last year.

Basic membership of the WEF and an entry ticket costs 68,000 Swiss francs (£55,400).  To get access to all areas, corporations must pay to become Strategic Partners of the WEF, costing SFr600,000, which allows a CEO to bring up to four colleagues, or flunkies, along with them. They must still pay SFr18,000 each for tickets. Just 100 companies are able to become Strategic Partners; among them this year are Barclays, BT, BP, Facebook, Google and HSBC. The most exclusive invite in town is to an uber-glamorous party thrown jointly by Russian billionaire Oleg Deripaska and British financier Nat Rothschild at the oligarch’s palatial chalet, a 15-minute chauffeur-driven car ride up the mountain from Davos. In previous years, Swiss police have reportedly been called to Deripaska’s home after complaints about the noise of his Cossack band. Deripaska’s parties have “endless streams of the finest champagne, vodka, and Russian caviar amidst dancing Cossacks and beautiful Russian models.”

The official theme of this year’s forum is “responsive and responsible leadership”!  That hints at the concerns of global capitalism’s elite: they need to be ‘responsive’ to the popular reaction to globalisation and the failure of capitalism to deliver prosperity since the end of the Great Recession and they also need to be ‘responsible’ in their policies and actions – a subtle appeal to the newly inaugurated Donald Trump as US president or Erdogan in Turkey, Zuma in South Africa, Putin in Russia and Xi in China.

The WEF has been the standard bearer of the positives from ‘globalisation’, new technology, free markets, ‘Western democracy’ and ‘responsible’ leadership.  Trump and other leaders of global and regional powers now seem to threaten that enterprise.  But Trump is the result of the failure of the WEF project itself i.e. global capitalist ‘progress’.

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