By Clare Melford, CEO, IBLF
The Arab Spring in January 2011 left participants at last year’s World Economic Forum scrambling for sensible soundbytes. This gave this elite gathering the appearance of being somewhat out of touch with the general public.
This year’s Davos meeting badly needed to demonstrate that those gathered were both informed of, and dealing with, the wider concerns of the world. Unfortunately, given the timing of the meeting (falling in the middle of the Chinese New Year), the conference has been somewhat lacking in Chinese participants.
Hence, it does not have quite the diversity of opinion, experience and culture that might have lent a more connected feel. There is however a reasonable contingent from India who are doing their best to raise spirits and forecasts from the overriding sense of Anglo-Saxon gloom pervading proceedings. The jaunty 8% GDP growth rates and flamboyant tech entrepreneurs are a much- needed shot in the arm to the general malaise that dominates other national tents.
However the Indians are in a minority here. The biggest groups (or the most visible ones) by far at the “World” Economic Forum are North Americans and Europeans. Inevitably, this has led to the main themes of this conference being those that currently obsess the Developed World – namely, the euro, unemployment and debt crises.
The risk with this under-representation of Asia, Latin America and Africa at this year’s WEF is two-fold. Firstly, the best ideas come from the most diverse groups. With a somewhat homogenous group here in Davos, can we be sure that we are really getting the best the world has to offer to tackle our undoubtedly large and shared problems?
Secondly, without the voices of more buoyant, dynamic and growing economies loudly in the room, there is a risk that those present “talk ourselves down” and in fact exacerbate the pessimism that will ultimately become a self-fulfilling prophecy. A negative economic outlook will not encourage customers to spend or businesses to invest – and this in turn will curtail job growth and tax receipts, making the problems for developed countries worse.
In an untempered focus on the problems of the developed world – without the tonic of the opportunities of the less developed – we risk “nailing our other foot to the floor”.
During the forum, a Microsoft spokesperson eloquently explained the risk of limited experiences arising from an increasingly networked world, and in creating a culture of fear in the process. To explain – the opportunities from social media mean we can communicate with anyone we want. However, often those we want to communicate with are those with similar views to our own.
Social networks allow us to create large groups of contacts who share our mindset, giving us the misguided belief that our views are the norm.
This creates situations where our views, informed or ill informed, get reinforced without the moderating influence of divergent ones. Examples of this can be seen in the polarisation of debate in the American political sphere and in the intemperate reactions of many developed economies to migration. It is easy to see how fear can take hold in such large but self-selecting social networks.
In fact the woman from Microsoft observed that the most common emotion she picked up from her analysis of social networks was fear. Her contention was that the ability to connect with everyone has in fact reduced the likelihood that we will connect anyone with differing views from ourselves – and that the impact of that can be an increase in fear.
In many ways, the European project was as much to address this fundamental human trait as anything else. Centuries of war across Europe have been largely brought to an end by a process of ever deepening integration and mutual understanding, of which the eurozone is just the latest (and most ambitious) facet.
My overriding hope from this year’s World Economic Forum is quite simply this: Those of us that are present should not let the lack of diversity encourage us into talking up a more fearful future than the one that is most certainly possible.
Clare, thank you for your insights on Davos – I agree that our actions in addressing global issues (including the financial crisis, but also global warming, inequality, etc.) should not be based on fear – but neither do I think that “optimism” is the most effective “emotional-driver” of our actions – like someone once said about the Bush administration’s policies, “Optimism is not a policy.” I think we need to act on the basis of reality and rationality – the way that the developed world has been, and is, living is unsustainable, and the attitude of “economics uber alles” is insanity. I agree that “a negative economic outlook will not encourage customers to spend or businesses to invest – and this in turn will curtail job growth and tax receipts, making the problems for developed countries worse.” – but we can’t forever try to spend our way out of an unsustainable economic model of unlimited growth – it may be a necessary short-term evil to get out of our current mess, but ultimately we have to find a way for more people to live better with less – and the way that emerging economies are headed, consuming a larger and larger per capita share of resources, I see them as part of the problem, not the solution.