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Today's Top News
Occupy Davos: Attendees Confront a New Wave of Anger
Plus: George Soros on the Coming US Class War
This years’ World Economic Forum (WEF) in Davos, Switzerland, marks the start of the perennial capitalist meet-and-greet summit season.
The economic equivalent of the Oscars, the WEF is a time for the 0.1% to celebrate the achievements and successes of free-markets, and to discuss how to keep the crumbling ship from running ashore; it’s also a time to get in a few good runs on the slopes, deep tissue massages and a soothing hot tub session on the 99%’s dime.
Nestled in the picturesque Swiss Alps where the melting glaciers are deceptively intact and the hotels serviced by an army of invisible temporary workers, approximately 2000 global elites discuss everything from redistributing their obscene profits (a.k.a philanthropy) and environmental sustainability, to forecasting new areas of expansion and the future of capitalism.
On this latter note, delegates will be treated to a special brainstorming session on corporate capitalism’s forecast led by the wisdom of Bank of America CEO, Bryan Moynihan. Then to jazz things up, there will be several roundtable discussions with social media and internet hotshots, Facebook and Google, on how the revolutionary elements of web organizing can reinforce market growth.
Gag. Why hasn’t a stink bomb already gone off in this place? (Adbusters)
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Davos Forum Founder Says Capitalism is Out of Balance, Warns Conflicts Await
The Associated Press reports:
DAVOS, Switzerland — The founder of the World Economic Forum warns that capitalism is out of balance and welcomes protesters’ ideas of how to fix it.
In an interview, Klaus Schwab insists he’s still “a deep believer in free markets, but free markets have to serve society.” He’s getting ready to greet 2,600 world leaders, CEOs and other dignitaries for talks this week to tackle global economic challenges.
He said members of the Occupy protest movement camped in igloos in Davos have been invited to a session on the sidelines of the forum on reforming capitalism.
Protest organizer David Roth told the AP his group hadn’t decided yet whether to accept.
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Davos Attendees Confront a New Wave of Anger
From the New York Times today:
Today, the gap between the haves and the have-nots is no longer just a rallying cry to incite anticapitalist activists. It has become a mainstream issue, debated openly in arenas where the primacy of laissez-faire capitalism used to be taken for granted and where talk of inequality used to be derided as class warfare.
In the United States, the issue surfaced when protesters proclaimed they were the ‘‘99 percent’’ of the population who were paying for the sins of the wealthy “1 percent,” taking their grievances directly to the epicenter of capitalism. The Occupy Wall Street protest, which began in New York, later spread to other cities around the United States and across the world.
In Spain, thousands of “indignados” converged on Madrid and other cities to vent their frustration over mass unemployment and government austerity measures. In the Arab world, a wave of unrest that toppled governments began with a protest over a lack of economic opportunities in Tunisia.
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Global Leaders to Ponder Over Lows of Capitalism
India's Economic Times reports:
DAVOS, Switzerland -- Snowclaws and snowboots have been packed, diaries confirmed, reconfirmed and changed a hundred times, and invitation lists compared with a "see you somewhere then" as over 19 heads of state, more than 15 central bankers, assorted European royalty, and over 2600 of the great and mighty of global business descend on a remote ski resort high in the Alps of for the annual WEF schmoozefest.
This year, there's more than a hint of irony in the event that created the concept of the quintessential "Davos Man", that global super-achiever into disrepute after 2008: some of the richest people in the world, and companies who have paid millions to sponsor the event, will pontificate on the failings of capitalism and inequality before slipping off for vintage champagne dinners and parties. [...]
It's unlikely that any of them, or the top businessmen busy closing private deals in the bilateral meeting rooms or hotels, will drop in at the Occupy camp near the station outside the Davos security cordon, where protestors are camping out in -- yes, igloos and heated teepees - to protest against everything Davos stands for.
"Capitalism, in its current form, no longer fits the world around us. We have failed to learn the lessons from the financial crisis of 2009. A global transformation is urgently needed and it must start with reinstating a global sense of social responsibility," said Klaus Schwab, of WEF. Its recent global risks report highlights rising inequality as the biggest threat facing the world in future. Will anyone be listening to him?
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George Soros on the Coming US Class War
George Soros, in an interview with Newsweek magazine titled “George Soros on the Coming US Class War”:
“I am not here to cheer you up. The situation is about as serious and difficult as I’ve experienced in my career,” Soros tells Newsweek. “We are facing an extremely difficult time, comparable in many ways to the 1930s, the Great Depression. We are facing now a general retrenchment in the developed world, which threatens to put us in a decade of more stagnation, or worse. The best-case scenario is a deflationary environment. The worst-case scenario is a collapse of the financial system.” [...]
Soros draws on his past to argue that the global economic crisis is as significant, and unpredictable, as the end of communism. “The collapse of the Soviet system was a pretty extraordinary event, and we are currently experiencing something similar in the developed world, without fully realizing what’s happening.” To Soros, the spectacular debunking of the credo of efficient markets—the notion that markets are rational and can regulate themselves to avert disaster—“is comparable to the collapse of Marxism as a political system. The prevailing interpretation has turned out to be very misleading. It assumes perfect knowledge, which is very far removed from reality. We need to move from the Age of Reason to the Age of Fallibility in order to have a proper understanding of the problems.”
Occupy Wall Street “is an inchoate, leaderless manifestation of protest,” but it will grow. It has “put on the agenda issues that the institutional left has failed to put on the agenda for a quarter of a century.”Understanding, he says, is key. “Unrestrained competition can drive people into actions that they would otherwise regret. The tragedy of our current situation is the unintended consequence of imperfect understanding. A lot of the evil in the world is actually not intentional. A lot of people in the financial system did a lot of damage without intending to.” Still, Soros believes the West is struggling to cope with the consequences of evil in the financial world just as former Eastern bloc countries struggled with it politically. Is he really saying that the financial whizzes behind our economic meltdown were not just wrong, but evil? “That’s correct.” Take that, Lloyd Blankfein, the Goldman Sachs boss who told The Sunday Times of London at the height of the financial crisis that bankers “do God’s work.” [...]
While Soros, whose new book, Financial Turmoil in Europe and the United States, will be published in early February, is currently focused on Europe, he’s quick to claim that economic and social divisions in the U.S. will deepen, too. He sympathizes with the Occupy movement, which articulates a widespread disillusionment with capitalism that he shares. People “have reason to be frustrated and angry” at the cost of rescuing the banking system, a cost largely borne by taxpayers rather than shareholders or bondholders.
Occupy Wall Street “is an inchoate, leaderless manifestation of protest,” but it will grow. It has “put on the agenda issues that the institutional left has failed to put on the agenda for a quarter of a century.” He reaches for analysis, produced by the political blog ThinkProgress.org, that shows how the Occupy movement has pushed issues of unemployment up the agenda of major news organizations, including MSNBC, CNN, and Fox News. It reveals that in one week in July of last year the word “debt” was mentioned more than 7,000 times on major U.S. TV news networks. By October, mentions of the word “debt” had dropped to 398 over the course of a week, while “occupy” was mentioned 1,278 times, “Wall Street” 2,378 times, and “jobs” 2,738 times. You can’t keep a financier away from his metrics.
As anger rises, riots on the streets of American cities are inevitable. “Yes, yes, yes,” he says, almost gleefully. The response to the unrest could be more damaging than the violence itself. “It will be an excuse for cracking down and using strong-arm tactics to maintain law and order, which, carried to an extreme, could bring about a repressive political system, a society where individual liberty is much more constrained, which would be a break with the tradition of the United States.”