Davos: A Family Reunion for the People who Broke the Modern World

For the past several decades, world leaders, CEOs, tech titans, billionaires, philanthropists, and celebrities have descended upon Davos, Switzerland with the goal of “improving the state of the world.” Anand Giridharadas, author of Winners Take All: The Elite Charade of Changing the World, says they are part of the problem.

Trade wasn’t working for everyone.

Dynamic scheduling, underpaid, contractors, fight minimum wage, more flexible labor, tax cults for the wealthy anti-inheritance taxes, evade existing taxes, rewards offshoring, expresses no loyalty to communities. (5 min)

I don’t think arsonist need to attend at a firefighter’s convention.

Poor people are very accessible. They want someone to bear witness. They don’t have publicists.

You can’t understand inequality without understanding rich people and the systems they use to justify themselves (10 min)

Today’s elites are among the most socially away, yet also predatory

I don’t think we have free markets, we have a capitalism of monopoly, and rent seeking

Jane Meyer’s Dark Money: how we got here.

Business didn’t have power (Nixon started the EPA) and worked to understand it. They used an alliance with evangelicals and philanthropy to build power.

History is life a mob boss: we can do this the easy way or we can do this the hard way.  It can go down like the civil war or women’s suffrage.

82% of new money was in the 1 percent’s hands.

It’s going to require many to become traitor’s to their class.  If Gates devoted as much to pushing an estate tax, he could have a bigger impact.

I think things are changing.  There aren’t going to be as many Goldman Sachs and McKinsey people in the next administration.

‘The aristocrats are out of touch’: Davos elites believe the answer to inequality is ‘upskilling’

At the same time, they panned the idea of higher tax rates for society’s wealthiest

Leaders of the world’s largest and most powerful companies are on edge. A decade after the financial crisis, their businesses are thriving and their pocketbooks are overflowing, but they worry about populism and the threat it poses to the global order they helped build.

Many executives gathered at the exclusive World Economic Forum this week acknowledged that inequality is a major problem fueling populist backlash, and that some middle-class jobs in the West are being lost to trade and automation (even though more jobs overall are being created around the world).

A few business leaders in Davos went so far as compare today’s situation to the late 19th century, an era when tycoons like Andrew Carnegie, Andrew W. Mellon, and John D. Rockefeller amassed huge fortunes while most in the working class toiled under harsh conditions.

“We’re living in a Gilded Age,” said Scott Minerd, chief investment officer of Guggenheim Partners, which manages more than $265 billion in assets. “I think, in America, the aristocrats are out of touch. They don’t understand the issues around the common man.”

The solution to inequality, many in Davos said, is “upskilling” people so that they can obtain better jobs in the digital economy.

“The lack of education in those areas in digital is absolutely shocking. That has to be changed,” Stephen A. Schwarzman, chief executive of Blackstone, told a panel. “That will very much lessen the inequalities that people have in terms of job opportunities.”

Schwarzman, whose net worth is estimated at $13 billion, said it is “up to the grown-ups” to make digital upskilling happen in K-12 schools.

.. His calls were echoed by others, including Ruth Porat, chief financial officer at Alphabet, Google’s parent company; Keith Block, co-chief executive of Salesforce; C Vijayakumar, chief executive of HCL Technologies; and Michael Dell, founder of Dell Technologies.

“All of us collectively can do quite a lot to create opportunities so that everybody is included in this growth,” said Dell, who is worth an estimated $28 billion. “It’s going to require lots of new skills, capabilities.”

Dell said the issue goes beyond K-12 education and that companies need to train workers continuously. His own company struggles with finding enough skilled workers, and poaching them from other companies doesn’t work, Dell added. “You need to hire and train and grow them from within.”

.. In a report released earlier this month, the forum estimated it would cost the United States $34 billion to reskill the 1.37 million workers expected to lose their jobs to automation in the next decade. The forum said 86 percent of the cost “would likely fall on the government.”

“Upskilling is not going to alter the insecurities and inequalities,” said Guy Standing, author of “The Precariat: The New Dangerous Class,” who spoke on four panels at Davos this year. He said most executives still don’t understand what is needed.

Standing said calls for more education and training were a “cop-out,” and that the result would undoubtedly help only a small number of people, which in turn could bring down wages and status in whatever new jobs they went on to obtain.

study in 2015 by economists Brad J. Hershbein, Melissa S. Kearney and Lawrence H. Summers postulated what would happen if 10 percent of American men, ages 25 to 64, who did not have a bachelor’s degree suddenly obtained one. They found that it would improve pay and job prospects for the men who earned the degrees, but would do little to reduce the inequality gap because the richest Americans have so much more income and wealth.

But millionaires and billionaires in Davos panned the idea of higher taxes, arguing that the private sector does a better job than the government of spending money wisely.

“No, I am not supportive of that, and I don’t think it would help the growth of the U.S. economy,” Dell responded when asked about his views of Ocasio-Cortez’s proposal for a 70 percent marginal income tax on earnings above $10 million.

Dell noted that he and his wife contribute most of their wealth to a foundation. “I feel much more comfortable with our ability as a private foundation to allocate those funds than I do giving them to the government.

Others argued that their tax rate is already high and that raising tax rates could push people to move abroad or not invest.

“If I look at my tax rate now, it’s probably well into the 60s,” said AECOM chief executive Michael S. Burke, adding that he pays federal taxes, California income taxes, sales tax and a significant property tax. “I think we ought to have a competitive tax rate.”

.. When asked whether corporations should pay higher taxes, executives again criticized the idea. In 2017, President Trump and the Republicans in Congress passed a sweeping tax bill with the largest corporate tax cut in U.S. history.

“It’s an easy fix, I think, for many people to say, ‘Well, let’s just tax,’” Block said during a panel.

By contrast, leaders from academia and the nonprofit world were quick to call for higher taxes and a redistribution of income.

.. An Oxfam report this week found that the share of wealth held by billionaires was increasing by $2.5 billion a day, while the share of wealth among the 3.8 billion of the world’s poorest was decreasing by $500 million dollars a day. While some quibble with the methodology of the Oxfam report, there’s widespread consensus that inequality is getting worse in many parts of the world.

.. “Davos is always in favor of reducing inequality and poverty: locally, nationally and globally — but not if they have to pay for it,” tweeted economist Branko Milanovic who studies inequality at the City University of New York (CUNY).

However, others said it was not practical to look for solutions to the problems of the common man from the top echelons of society.

“There’s an uncomfortable awareness that things are not right, the ecological crisis, the angst out there, the Brexit vote, the Trump vote, but then they come up with these bromide platitudes,” said Standing. “But in a sense, we can’t expect them to provide the answers. They are part of the problem.”

Anand Giridharadas: Are Elites Really Making the World a Better Place?

In “Winners Take All: The Elite Charade of Changing the World,” Anand Giridharadas compels us to take a deeper look at elite leaders, their institutions, and their initiatives to make the world a better place. “In the very era in which elites have done so much to help, they have continued to hoard the overwhelming share of progress, the average American’s life has scarcely improved, and virtually all of the nation’s institutions, with the exception of the military, have lost the public’s trust.”

Today’s elites are some of the more socially concerned individuals in history. Yet, according to Giridharadas, while their philanthropic missions may attempt to reform the root causes of unjust systems, many elite initiatives serve only to maintain the very power structures they claim they want to fix. So, who really benefits? To what extent are the elite working to create real progress and systemic change for people and communities?

Anand Giridharadas was a foreign correspondent and columnist for the The New York Times and currently teaches journalism at New York University. He joins us for an in-depth discussion on elite leaders, how their philanthropic efforts preserve the unjust status quo, and how communities might work together to create a more participatory democracy.

 

We have 74 billionaires in San Francisco and 74,000 homeless.

Philanthropy:

  • changes the public conversations
  • how many newspapers have a philanthropy correspondent?

Ask not what you can do for you country, first ask what you’ve done to your country and stop doing what you’ve done.  Let’s stop the bleeding.  (43:20)

Bezos made his money because workers didn’t have bargaining power in the time in which the internet rose.

Jeff Bezos should give money away in a way that can make sure there isn’t another Jeff Bezos.

Google’s maturity will have them accept that they are power, not fighting the power.

There is nothing more dangerous than a Goliath who thinks he’s  a David.  (Google didn’t want to release it).

Lebron James is making small change to a school (a band-aid), and using it as a cudgel against the cancer.

inviting documentary film makers to compare it with a “regular school”

Kavanaugh is lying. His upbringing explains why.Kavanaugh is lying. His upbringing explains why.

The elite learn early that they’re special — and that they won’t face consequences.

Brett Kavanaugh is not telling the whole truth. When President George W. Bush nominated him to the U.S. Court of Appeals for the District of Columbia Circuit in 2006, he told senators that he’d had nothing to do with the war on terror’s detention policies; that was not true.
Kavanaugh also claimed under oath, that year and again this month, that he didn’t know that Democratic Party memos a GOP staffer showed him in 2003 were illegally obtained; his emails from that period reveal that these statements were probably false.

And it cannot be possible that the Supreme Court nominee was both a well-behaved virgin who never lost control as a young man, as he toldFox News and the Senate Judiciary Committee this past week, and an often-drunk member of the “Keg City Club” and a “Renate Alumnius ,” as he seems to have bragged to many people and written into his high school yearbook. Then there are the sexual misconduct allegations against him, which he denies.

.. How could a man who appears to value honor and the integrity of the legal system explain this apparent mendacity? How could a man brought up in some of our nation’s most storied institutions — Georgetown Prep, Yale College, Yale Law School — dissemble with such ease? The answer lies in the privilege such institutions instill in their members, a privilege that suggests the rules that govern American society are for the common man, not the exceptional one.

.. What makes these schools elite is that so few can attend. In the mythologies they construct, only those who are truly exceptional are admitted — precisely because they are not like everyone else. Yale President Peter Salovey, for instance, has welcomed freshmen by telling them that they are “the very best students.” To attend these schools is to be told constantly: You’re special, you’re a member of the elect, you have been chosen because of your outstanding qualities and accomplishments.

.. Schools often quite openly affirm the idea that, because you are better, you are not governed by the same dynamics as everyone else. They celebrate their astonishingly low acceptance rates and broadcast lists of notable alumni who have earned their places within the nation’s highest institutions, such as the Supreme Court. Iheard these messages constantly when I attended St. Paul’s, one of the most exclusive New England boarding schools, where boys and girls broke rules with impunity, knowing that the school would protect them from the police and that their families would help ensure only the most trivial of consequences.

.. children whose parents are in the top 1 percent of earners are 77 times more likely to attend an Ivy League school than are the children of poorer parents — meaning that, in cases like this, admission is less about talent and more about coming from the right family.
.. privilege casts inherited advantages as “exceptional” qualities that justify special treatment.
.. when the poor lie, they’re more likely to do so to help others, according to research by Derek D. Rucker, Adam D. Galinsky and David Dubois, whereas when the rich lie, they’re more likely to do it to help themselves.
.. elites’ sense of their own exceptionalism helps instill within them a tendency to be less compassionate.
.. Take drug use. While the poor are no more likely to use drugs (in fact, among young people, it’s the richer kids who are more likely to drink alcohol or smoke marijuana), they are far more likely to be imprisoned for it
.. Kavanaugh’s privilege runs deep, and it shows. He grew up in a wealthy Washington suburb where his father spent three decades as CEO of a trade association. There has been a sense among his supporters that his place is deserved, which mirrors the climate of aristocratic inheritance he grew up around. His peers from the party of personal responsibility have largely rallied around him, seeking to protect his privilege.
.. Ari Fleischer, put it: “How much in society should any of us be held liable today when we lived a good life, an upstanding life by all accounts, and then something that maybe is an arguable issue took place in high school? Should that deny us chances later in life?”
American Conservative editor Rod Dreher wondered “why the loutish drunken behavior of a 17 year old high school boy has anything to tell us about the character of a 53 year old judge.”
.. This collective agreement that accountability doesn’t apply to Kavanaugh (and, by extension, anybody in a similar position who was a youthful delinquent) may help explain why he seems to believe he can lie with impunity — a trend he continued Thursday, when he informed senators that he hadn’t seen the testimony of his accuser, Christine Blasey Ford, even though a committee aide told the Wall Street Journal he’d been watching.
.. servant leadership and privilege are often bedfellows. Both suggest not a commonality with the ordinary American, but instead a standing above Everyman. Both justify locating power within a small elite because this elite is better equipped to lead.
.. Retired justice Anthony Kennedy, according to some reports, hand-picked Kavanaugh as his successor
.. both allow space for lying in service of the greater good. Privilege means that things like perjury aren’t wrong under one’s own private law.