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Conclusions from the World Economic Forum Annual Meeting in Davos 2010 Extensively covered on the Web And I recommend looking through the IdeasLab for a TED-like experience. Thoughts while viewing the meetings: 1. repeated reminders from Rep. Barney Frank that the US could not continue to provide military security for the world and the only way the US could get its budget/deficit problems under control would be with massive and universally unpopular military cuts. Reminds me of Eisenhower's warning to Kennedy: beware the military-industrial complex and George Shultz to Reagan: "Mr President, you can't agree with Gorbachev on reducing nuclear arms, think of the unemployed workers." 2. Income distribution is widening on every dimension: by country, correlation with age, income categories. 3. Belief in institutions is going down worldwide. Within the US, republicans do not believe in govt at all, but democrats do. 4. Economic power in the world is shifting south and east. Asia grows in recognition as the engine of world economic growth. 5. US: there is a difference between rules/regulation and execution. Was especially noticeable in the Bush era. Reminded me of the pilot ordering his copilot to sit in the right seat but "don't touch anything"...perhaps the instruction to Christopher Cox, when he was appointed SEC chairman. 6. Recognition that there is a worldwide, but especially pronounced in the US, stealing of the future from our children...in finance and in climate conditions. 7. US likely to have a double dip recession brought about by financial conditions worsening. Larry Summers: we are experiencing a statistical recovery and a human recession. Roger Altman: US can not solve its fiscal condition without an exogenous force...perhaps high interest rates or a currency run within 2 years. 8. Davos is normally a cheerleader on merits of globalization but this year, the tone was more for a reluctant withdrawal from globalization....and fear for the local political necessity of protectionism. 9. Discussion is generally a defense against a recession...except for Asia. Note: official US delegation about 5, China =75 lead by a possible next PM. Curious that there was not more discussion about Obama from this point forward. 10. Copenhagen failed. 11. As the meeting progressed, there was a growing frustration with talk/talk, blah/blah. DL note: talk is all that is intended in the fast pace and universality of topics at Davos. 12. Lots of talk about the downward spiral of moral standards..strangely described as a "virtuous spiral down." 13. Unemployment in the west seems intractable. No politician wants to admit that some high paying jobs have left permanently. Retraining of mature workers has not been done. Developing country may have half of their populations under 20, mostly unemployed and a potential for social explosion. It is in the US national security interest to see these young workers have jobs.....otherwise revolutions on their shores or ours. Also in US and Europe support of the older retired and laid off workers will be a drag on potential economic recovery. 14. Acceptance that we have passed from a bipolar to unipolar to multipolar world. 15. Growth of the east Asian business model: cooperation vs competition within its sphere. 16. G-8 becomes G-20 17. culture + ideology = economics 18. general note from the presentations: how good, articulate, with commanding presence are non-US leaders. 19. universal condemnation of large global banks, inc. by themselves. Banks agree they will be punished with new regulation and taxes. 20 US legislators repeat that their single-minded obligation is to their local constituents. They suggest an inability to take a national or international view. 21. Strange omission: lot's of currency discussion but little mention of gold?? 22. Discussion of the many nuclear agreements accompanying the expansion of nuclear powers suggest to me that the quest for agreements is a diversion, an illusion and waste of time. I can visualize a world where access to nuclear weapons and technology is quite easy and our institutions are locked into being ill prepared for those conditions. Overall: I thank the WEF for making so much of the session available online. I have attended many of the sessions in previous years and, yes, it is better to be there as an attendee or speaker. But electronic access is very beneficial. I set aside a room for the sessions called Kongresshaus and try to follow the sessions as closely packaged as if I was leaving from the Schatzalp. Of course, I miss the serendipitous corridor conversations, the chat over meals and the skiing around Davos. But it allows an electronic continuity...and I'm grateful to Prof Schwab and his team. dean -- Dean LeBaron |
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