Is Davos Too Large To Fail?

After many years, I stopped going to Davos because it had degenerated into panels of officials, who all make banal observations that are constrained by briefs from their governments, or panels that were continually expanded so as to put ill-informed NGOs, moneybags, and lobbyists alongside people knowledgeable in a field. In short: We were not playing doubles tennis but, rather, cricket elevens with amateurs and professionals thrown together. The media, of course, love Davos, with even “The Newshour with Jim Lehrer,” The New York Times (our “newspaper of record” with standards that have frayed so much that Bono is a contributing editor) and the Financial Times now “reporting” solemnly from Davos as if it measures the pulse of where the world is headed.

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Indeed, Davos has become too big to fail. A tax on all who attend it—and on Professor Klaus Schwab’s brilliantly successful enterprise—is now necessary so that we both curb its socially unproductive diversion of resources for nearly a week (both ours and those of our media), and also to raise money to help President Obama with his impossible deficit.

No better example of how we all waste our precious time with this recurrent affliction can be found than in Gideon Rachman’s column in the Financial Times, titled “How the bottom fell out of 'old' Davos.” Normally perceptive, Rachman argues that, on globalization, Davos had changed: The flow of ideas now went from the East to the West. But Davos is years behind the curve. It did not invent the fact that, for nearly two decades, there has been what I have called an “ironic reversal,” in which the rich countries now fear globalization, and the poor countries embrace it. If anything, Rachman should have been ungracious to his well-endowed hosts and asked: Why was this simple fact absent from Davos for so long? Equally, he reproduces the banalities of the U.S. officials, who keep repeating that the Chinese exchange rate is “undervalued” and that the U.S. should respond with protectionism.

In the old days, this charge would have been debated by opponents who include the best minds in international macroeconomics, such as my colleague Robert Mundell, the Stanford economist Ronald McKinnon, and possibly Max Corden of Australia. Now, forget it.

But we cannot. For C-Span, Zakaria’s “GPS,” “The Newshour with Jim Lehrer,” “The Charlie Rose Show,” BBC, and CNN will for sure plague us for weeks with accounts of who said what at Davos. Perhaps it is best for these shows also to take a hit? Alas, that would be throwing the baby out with the bathwater. Unfortunately, there is no clear and easy solution to the “me-in-Davos” affliction of the media. Life is indeed complex, and we must cope with it calmly, a lesson we can learn from President Obama, whom I have dubbed the first Lithium President of the United States because he is so equilibrated that he has milder highs and lows than mortals like us.