David Frum says reports are the elites attending Davos feel vulnerable
He says that's a good sign, given all the harm their decisions have done to the world economy
Frum: Bad decisions by those with "superior knowledge" have caused great harm
Frum: He says people are looking to leaders, expecting them to make better decisions
Editor’s Note: David Frum, a CNN contributor, is a contributing editor at Newsweek and The Daily Beast. He is the author of eight books, including a new novel, “Patriots,” and a post-election e-book, “Why Romney Lost.” Frum was a special assistant to President George W. Bush from 2001 to 2002.
The world of punditry is divided into two groups: those who attend the World Economic Forum at Davos and those who mock the World Economic Forum at Davos. (There’s a subgroup that both attends and mocks, but it’s tiny.)
Yet Davos is important, whether you attend or no. (I don’t.) And if Ian Bremmer is right, this year something genuinely encouraging may be happening at the grand global gathering of business leaders, politicians and big-thinking academics.
“As the world struggles to bolster its resilience against economic and political uncertainty, the key risk is the increasing vulnerability of elites. We’re seeing leaders of all kinds, in the developed and developing world, in politics as well as business and media, answering to constituents who grow more dissatisfied… and information-rich. Look at the riots in India over the recent rape scandal, the U.S. Congress’ abysmal approval ratings or the phone hacking scandal at News Corp. Corruption, special interests or a lack of transparency will spell trouble for leaders.”
Bremmer, a brilliant analyst of the global economy, is a regular Davos participant. He’s recording his impressions of the 2013 conference in a diary for the Huffington Post.
If he’s perceiving elite anxiety, one can only say: finally.
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“What all the wise men promised has not happened, and what all the damned fools said would happen has come to pass.” So snarked Queen Victoria’s first prime minister, Lord Melbourne.
He might have been talking about the euro. Or the securitization of the U.S. mortgage market. Or the British government’s attempt to restore prosperity through budget austerity. Or. Or. Or. Over the past decade and a half, we’ve seen one horrendous economic decision after another made, not by voters in democracies, but by people who owed their power to their claims of superior knowledge. Together, they have plunged us into a decade and a half of disasters, culminating in a global financial crisis triggered by new credit instruments that were advertised as ending financial crises once and for all.
Yet by and large, these leaders have escaped public accountability or even criticism over the past six years of global crisis. The people who designed the euro continue to run the European Central Bank. The people who wrecked the American banking system walked away with multimillion-dollar severance packages. We all know that life’s not fair. But this unfair?
So it’s welcome news that the Davos attenders are suddenly feeling “vulnerable.” They ought to. Elected leaders can at least be removed by the voters. Not so central bankers, financial regulators, and investment bankers, even though they can (and often do) exercise more power than any elected official.
Bremmer appears to suggest that the correct response to elite vulnerability is more transparency. I don’t think that’s quite right. If banks and regulators were delivering good results, nobody would mind their opaqueness. It’s the bad results that drive the demand for transparency. But that’s not because we really want more transparency.
What we really want is more competence and more success and success that benefits the many, rather than lavishly over-rewarding a privileged few even as they ruin everything and everyone around them.
According to Bremmer, the theme of this year’s Davos conference is “Resilient Dynamism.” It would have done better if it had adopted instead the theme, “We Messed Up.” That would open the way to panels on “Why We Messed Up” and “How Not to Do it Again.” More cynical attendees might opt for practical discussions on topics like, “How to Sound Contrite Even Though You’re Not a Bit Sorry.”
It’s probably too much to expect the Davos gathering to feel any real remorse. But if they at least feel fear, that’s a promising start on the way to reform.
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