Economy

The Davos Club: Meet the People Who Gave Us a World in Which 62 People Own as Much as 3.6 Billion

The Davos people talk about poverty and pledge money to charity. But it's just spare change to them.

Global elites meet in the remote Swiss town of Davos each year for the World Economic Forum. The conclave began in 1971, but it became an essential destination in the 1990s. When globalization became the buzzword, Davos became its headquarters. Big business, politics and the media meet, exchange business cards and go away better connected to each other. Deals are sometimes struck, but more than anything harmony among the world’s elite is established. This is what the Davos Summit is intended to do, to create a Davos civilization for the important people of the planet.

Each year, before the summit, Oxfam International publishes a report on global wealth. This year’s report came out with some shocking news. In 2010, 388 individuals owned as much wealth as half the world’s people, around 3.6 billion people. The obscenity then was dramatic. Last year, the number fell to 80 human beings who own as much as 3.6 billion people. This was getting to be too much.

The data this year is even more shocking. Only 62 people own as much as 3.6 billion people. Sixty-two! Inequality has been on a steady march forward.

It is very likely that these 62 people or their representatives were at Davos. They are the core of Davos civilization. Champagne corks will pop, caviar will drip to the floor; the wealthy have much to celebrate. Even the slow-down in China will not slow them down. The 62 make as much money in the bear market as in the bull market.

What will the 62 discuss at Davos? The theme for this year is how to “master the fourth industrial revolution.” What is the fourth industrial revolution? The first industrial revolution is seen as the move from human power to machine power in the early 19th century. By the late 19th century, science had been harnessed by industry to produce the technological or second industrial revolution. Into the mid 20th century, computers made their appearance and opened up the digital or third industrial revolution. The fourth one is about robots and mechanization—the displacement of workers by machines.

The 62 want to figure out how to master the new revolution. Swiss Bank UBS did a study of the economic impact of the fourth industrial revolution. It released its report just before Davos opened. The report suggests that those who are already wealthy and own property are likely to gain from the fourth industrial revolution. They will “benefit from holding more of the assets whose value will be boosted by the fourth industrial revolution,” wrote the analysts from UBS.

So, the tendency to mechanization will increase inequality, not decrease it. This theme itself was sugar in the cup for the 62. They will get richer. The poor will get poorer. That is what the analysts of the rich say.

The Davos people talk about poverty and pledge money to charity. But this is just the spare change that sits idly on their bedside tables. Talk of charity merely makes the rich feel less uneasy about their hardened morals. They are on tax strike. They refuse to put their share of wealth into the state’s hands to deliver social programs. That is anathema. Their horizon for liberalism is their miserable charity, which of course is not entirely charitable: the check comes with a large signpost that tells the world they are the ones who have donated the money. 

The poor worry the 62. If you produce a world where the bulk of the population lives in wretched conditions, they will certainly not be happy and could even get angry. If they get angry, they might rebel in ways that are not easy to control. When the slums rise up, what do the rich do? Charity is not going to hold that flood back. Which is why the rich invest in gated communities and security to protect them, as well as security to encage entire countries that live in the belt of poverty. Which is why the world’s largest employer is the U.S. Department of Defense, with 3.2 million people on its staff.

It is also no wonder that the third largest private employer in the world is the security firm G4S. It follows Walmart and Foxxconn; Foxxconn uses Chinese labor to make cheap products, which are sold to indebted American consumers at Walmart. When there is any unrest among either the workers or the indebted consumers, G4S arrives to calm things down or to take someone to prison. G4S is growing like wildfire.

What is the refugee crisis in the West, other than a crisis of Davos civilization? When you don’t allow people to build safe and productive lives in their own lands, they will flee for other places. They will come to your homes and ask to live like you. But what they find is that even in the West, there are islands of affluence and vast oceans of misery. Refugees flee military conflicts and aerial bombardment to arrive in places where the police resemble the military and where drones have begun to fly overhead as well. They will meet the workforce of G4S, whom they also met in their home countries. One of the topics in Davos is the use of robots in the military and policing. The days of Robocop are not far off. The 62 can trust a machine far more then they can trust a police officer, who in class terms shares more with the slum dweller than with the 62.

The Davos 62 would like to believe that terrorism and rogue states are ancient problems that can be solved by a steady dose of capitalism. They would like to imagine that what people in Iraq and Syria or North Korea most want is a mall and a credit card. But it is precisely the civilization of malls and credit cards that reproduces inequality, forcing ordinary people to go into debt so they can buy an endless chain of commodities that were produced with pitiful wages. When debt drives them to distraction, they are disaffected, disillusioned, in search of an alternative. Because the left is weak, that alternative has frequently been in the demagogy of religious politics or ethnic politics. And because the rhetoric of religious and ethnic politics is undisciplined, the strategy slips hastily into violence.

Terrorism is not produced by ancient animosities, but by the social conditions of our present, the Davos civilization that gives the world’s wealth to the 62 and denies it from the 3.6 billion.

Vijay Prashad is professor of international studies at Trinity College in Hartford, Connecticut. He is the author of 18 books, including Arab Spring, Libyan Winter (AK Press, 2012), The Poorer Nations: A Possible History of the Global South (Verso, 2013) and The Death of a Nation and the Future of the Arab Revolution (University of California Press, 2016). His columns appear at AlterNet every Wednesday.

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