The Oddly Powerless 'Global Power Elite'

Are we now ruled by an international elite that has left national borders far behind? It's a fashionable view across the political spectrum that enjoys special prominence every January, when the members of that alleged class hold their annual shareholders' meeting in Davos, Switzerland. David Rothkopf, the author of Superclass: The Global Power Elite and the World They Are Making, would strike the alleged from the previous sentence. To him, there's no doubt that this superclass exists and that it's running the show.

We've had a series of books in recent years that amount to little more than a pornography of wealth. But the connection of wealth to actual power is rarely explored. Sure, hedge fund managers can deploy billions, and CEOs can hire and fire thousands, but what is the relation of that narrow economic power to broader political, social and cultural power?

What are the limits to their power? How much are they at the mercy of competitors, impersonal financial markets or personal pressure from large institutional investors? There's definitely a cult of the celebrity CEO, but to what degree are such executives embedded in a system larger than they are (i.e., mere personifications of capital, in Marx's excellent phrase)?

For Rothkopf, the emergence of a superclass isn't the product of struggle or contingency so much as the operation of a law of nature. To prove this, he turns to sociologist and economist Vilfredo Pareto's 80/20 theory: 20 percent of causes are responsible for 80 percent of consequences. The phrasing is vague because Rothkopf sees it as applying to nearly everything; the relevant application here is to explain the distribution of income and ultimately power. In fact, the richest 10 percent of Americans pull down 46 percent of income, but presumably 80/20 is close enough for trade publishing. And Rothkopf sees no need to disclose the fact that Pareto was profoundly anti-democratic, was in love with violence and was greatly admired by Mussolini. Since the class question has been solved, no need to bring up such embarrassments.

Superclass proper opens in Davos -- not in one of the meeting halls, but in a fondue joint at the edge of town. It's funny to think of the hyper-elite engaging in such middlebrow cuisine (though I suppose the Swiss get a pass on that class judgment), but I guess the point is that at some level they're just folks too. Rather than linger over the bubbling cheese, Rothkopf quickly moves on to C. Wright Mills, whose 1956 book The Power Elite (still in print, still selling briskly) provides a vague template for Rothkopf's investigation. I say vague because while the Rothkopf book is full of the personalities that Mills' book is lacking, it shows none of the rigor of the original. (And none of the style, either.) Although Rothkopf shows some admiration for the first half of Mills' book, he laments the way the second half "veers into polemic." Imagine being annoyed by an elite hell-bent on accumulation and violence! None of that in this book, whose North Star is "balance."

But Rothkopf also declares Mills' book to be obsolete because it's focused entirely on the national ruling class; today's power elite is global. Besides, the class-struggle question has been settled with the fall of the Soviet Union, you see; now our central battle is national versus global.

Certainly there's some degree of truth to this critique of Mills, but Rothkopf mainly relies on asserting that putative fact over and over, while trusting the reader's preconceptions to make the case. But to what degree has the U.S. elite, or any other national elite, left the nation-state behind? Politics still remain heavily national. Most senior U.S. corporate executives live in their headquarters country and write checks to the campaigns of politicians whose ambitions focus on Washington, not the United Nations or the World Trade Organization. The frequency of currency crises around the world suggests that national economies are far from seamlessly globalized. When Bear Stearns hit a wall, it was the Federal Reserve and the U.S. Treasury that stepped in to craft a rescue. Even the international machinations of the International Monetary Fund are directed to a large degree by the U.S. Treasury; as the late MIT economist Rudi Dornbusch once put it, "The IMF is a toy of the United States to pursue its economic policy offshore." Neither the IMF nor the United States are quite what they were in the 1980s and 1990s, but sometimes it seems that the borderless world exists mainly in fantasy. Even Rothkopf is compelled to wonder early in the book if Davos is just a "once-a-year Brigadoon of globalization," but he never lets the question get in the way of his argument.