WEF Davos 2013 – Inequality destroys everything
World Economic Forum Annual Meeting 2013 from January 23rd to 27th
If this week in Davos, like every year, the powerful business leaders and politicians meet to rendezvous, they will once more be summing up and looking forward.
It can be admirably speculated, just like during the „Beanfeast of pomp and platitude“ (The Sunday Times Online 2006), how a key issue, such as the growing social inequality, could come to last.
The supposition that it was like a form of „social washing“ can not be dismissed out of hand. A global citizens unsettling theme is positioned, suggesting that they are at least worried about it. But how important is this dramatic development for organizers and guests really? This could be evaluated, for example, by the amount of doubt that the élite in Davos actually has in the existing financial system. But this topic will not at all be discussed.
The study to evaluate global risks, commissioned in preparation for this year’s „World Economic Forum“ (WEF), comes to conclusions which have already been identified as future risks and submitted for discussion by other experts for years.
OXFAM, a global operating aid and development organization, points out on the occasion of this years World Economic Forum that the 100 richest people of the world (of which many will certainly attend in Davos – editor’s note) earned four times the sum that would be needed to overcome global poverty in the last year only. A global „New Deal“ is needed to reverse the inequality growing for decades.
Joseph E. Stieglitz recently denounced in the New York Times that, after four decades of enlarging inequality, still no action against this development was taken. He draws particular attention to the dramatic disappearance of the middle class in favor of a growing distance to the absolute wealthiest who get richer with increasing speed and breathtaking growth figures.
Also in the NYT Paul Krugman replies Stiglitz with an argument that makes you think:
„So am I saying that you can have full employment based on purchases of yachts, luxury cars, and the services of personal trainers and celebrity chefs? Well, yes. You don’t have to like it, but economics is not a morality play, and I’ve yet to see a macroeconomic argument about why it isn’t possible.“
These highly decorated experts suggest basically why the elites still not (want to?) recognize what the actual causes of inequality are. If the accumulated financial assets constantly would be spent for yachts and luxury cars, we possibly would have a smaller inequality problem. But the immensely growing financial wealth of the „1%“ are not growing by consuming, but by investing. Growth in investments is only possible through growth of debt on the other side. And the other side, those are the 99%, directly and indirectly feed the wealth of the „1%“.
They still act like the income of the richest has any kind of relation to a specific service provided by the wealthy. But growing income through wealth is the result of an allowance of all – really all, including the poorest people – for which the holders of capital provide absolutely no service. The existing financial system, more precisely, the monetary system, protects the feeding of the wealth of the „1%“, and in this respect is non-reformable. The monetary system should be replaced by a completely new one, geared to the needs of man and nature.
It is therefore only logical that in Davos the financial system will not be up for discussion. Because this would indeed question the „business basis“ of nearly everyone present.
Important is the signal to the frightened people in the world that the elites are aware of the growing inequality and that they take people’s concerns of further social decline seriously. That has to be enough.
One would hope that there would be some „rich and powerful“ in Davos, who for once had the courage to question this system that feeds them. But these kind of speeches probably only exist in Hollywood movies. It could mean the salvation of at least part of their currently existing wealth, because one thing is clear: The growing inequality will lead to total destruction in the end. Including the wealth of the „1%“.