Davos: Why the global elites couldn’t find answers this year?

World Economic Forum, 2017

Last January, Donald Trump and Boris Johnson were not invited to Davos to present their populist, anti-systemic, anti-establishment, anti-globalization political platforms. Actually, their ‘ideology’ was exorcised from the Swiss Alps and instead, David Cameron was made the star of the three day 2016 meeting. The world’s super rich and powerful applauded his passionate speech about why and how poor David was planning to keep Britain in the European Union.

On that occasion, ill-starred Cameron in vain reassured his audience that his country will continue constituting the financial hub of the European Union. As it turned out however, the EU club was seen by many in Britain as in the rest of Europe and elsewhere, as the Trojan Horse of globalization, and for this reason deserved to be burned up. Now, his successor Teresa May, says Britain will make sail from Europe, to become the financial hub of the open seas, obviously to the detriment of country’s hard working millions. All tax havens are either run by mafias or by dictators, making sure that the profits go to the few. A European democracy with advanced social protection systems is not compatible with the low tax regimes of a tax-haven. Let’s return to the Alps.

The fallacies of January 2016

On January 2016, every Davos attendee renounced the option that Britain would leave the EU or that Trump would rule in the American political system. The Brexit and the 8 November US election results must have come as a strong blow to the Alpine globalization ‘authority’. World Economic Forum founder professor Klaus Schwab likes to think that the Davos Conferences are at the heart of the global establishment, both on economic and political levels, and as such, being competent to authoritatively discuss or even shape the future of mankind. Alas, as ordinary people say ‘Man proposes God disposes’.

For obvious reasons, Trump and Johnson again this year were not invited to Davos. On the contrary, at the beginning of the 2017 Conference last Tuesday, the constant Swiss professor, from his high altitude position, chose to criticize the political developments that brought them to power. In this line of thinking, Shwab accused the citizens of Britain and the US that they voted …emotionally, understandably by rejecting the voice of logic; his logic? It‘s not only the high altitude professor’s logic which differs widely from what working and voting people think. Actually, every international authority from the IMF to UN and all and every government leader from Beijing to Paris and Berlin had ‘advised’ the Brits and the Americans to vote ‘logically’ and remain in the EU or vote for Hillary Clinton. However, for some very good reasons people choose to do the opposite.

The turn of China

Still, the most important participant of this year’s Davos meetings, the Chinese President Xi Jinping insisted that globalization is not to be blamed. He also stressed that protectionism will be detrimental for everybody and even brandished the dangers of a trade war. In any case, the Chinese leader, a pragmatist that he is, in his last Tuesday’s speech indirectly told his audience that the current anti-globalization momentum in the West will not subside. That’s why Xi said China’s global role will be from now on more important, since the US is bound to start looking inwards. Undeniably, he is quite right.

Xi’s Davos speech gave the essence of this year’s Alpine gathering. As the Trump era dawns, every important political or business leader has to confront the new global environment which will be shaped after 20 January. This is an unstoppable trend. And it is unstoppable not because of Trump. There are other forces much more potent; irresistible, in fact. The new anti-globalization energy has been building up from very deeply in the Western societies, as they have being reformed during the last twenty globalization years. The very simple recipe of producing in low cost countries and selling the products free of import duties to the US and Europe at unjustifiably high prices has already exhausted America and the EU.

The West cannot take any more

The Western governments and consumers are now over-indebted and cannot continue consuming imported products. On top of that, the working environment in the Western countries has become totally unstable and frequently intolerable for the many, who have started reacting by voting ‘illogically’. For a large part of the working force, even in full employment, it’s very difficult to make ends meet. That’s why immigrants constitute a terrible menace to European and US natives, because destitute Africans, Asians and Latin Americans are willing to work for even less.

In reality, emigration tends to equalize the low end salaries in the developed world with wages in low labour cost countries. No surprise then, if this year produces even more unpleasant political surprises for the organizers and the attendees of the Alpine conferences. The Dutch people vote for a new Parliament in March. The polls give the first place to Geert Wilders’ anti-EU, anti-establishment, anti-immigration, anti-globalization extreme right-wing populist party. Wilders’ political platform and audience resemble Trump’s Brexiteers’. Mind you, according to the Dutch constitution, the first party gets the prime minister’s job, in a customarily multi party government coalition.

The Europeans vote

Then, the French Presidential election come April and after that in September, the Germans vote for a new federal parliament. Not without reason, every time the Americans or the Europeans go to the polling stations, the established political and economic leadership cannot sleep at night. This is the reason why the global elites couldn’t find answers this year at Davos, apart from Shwab’s nonsense that citizens vote ‘emotionally’.

In conclusion, it’s beyond reasonable doubt that globalization has numbered its days. The Western economic and political systems cannot anymore support the kind of solutions that Shwab and his clientele approve of. Alas, the tragedy is that the solution offered by Trump, May, Marine le Pen and Wilders will very probably lead their countries and voters to the dark ages of aggressive nationalism without, and tyranny within.

Last Tuesday, May already said that her government of Brexiteers will transform Britain into a third world kind of tax-haven, declaring at the same time a trade war against mainland Europe. Imagine then a world where extreme right populist governments, will start threatening each other every time they have to answer their internal audience question: why are things getting worse?