In January every year leaders in politics, business, academia and civil society return to the rarefied alpine air of Davos to rub shoulders and indulge in mutual backslapping among the global capitalist elite. A couple of weeks later, just down the road, another gathering takes places.
The Munich Security Conference is actually more significant than Davos. War has been a more constant feature of human society than capitalism over the past 500 years — we have become more effective and efficient in killing. A discussion for another time, perhaps.
Nevertheless, it is in Munich where I would suggest the future comes into clearer focus. At Davos the emphasis tends to be on how to improve capitalism and cause as little disruption as possible. If you dared to say “tax the rich” you may not get invited back.
In February 2019 Dutch historian Rutger Bregman told a Davos gathering that the rich ought to be taxed more. This is what he concluded: “What happens very quickly if you talk to millionaires and billionaires about higher taxes is that they immediately respond with, ‘Oh, that sounds like communism to me. That’s Venezuela’. So in their worldview the choice we have is between capitalism and gulags.”
At Davos capitalism has protection. At Munich all bets are off. This year in particular the Munich gathering may be likened to a pack of hyenas snapping and growling at a not-yet-quite-dead carcass of American military power. But let’s not get too far ahead of ourselves.
It was at Munich last week where US vice-president JD Vance in effect told European leaders that they had to follow the US on its way back to greatness — whatever that may mean. “The threat that I worry the most about vis-à-vis Europe is not Russia. It’s not China, it’s not any other external actor... What I worry about is the threat from within,” Vance said in a speech last Friday. This was an echo of Donald Trump’s claim that America’s main enemies come from within.
Europe, Vance said, had chosen a different path from the “most fundamental values” Europeans had always shared with the US. With not-so-subtle references to German rejection of the Alternative for Germany party (AfD), which Vance claimed had electoral support, he said unless they (AfD) were accepted, (probably embraced) “there is nothing America can do for you”. Germany should not be building a “firewall” around AfD, nor reject co-operation with the far-right group.
Most (mainstream) Germans have shuddered at the prospect of a second Trump presidency, while the AfD has cheered its ideological ally in the fight against migrants, wind farms, gender politics and all things “woke”. On cue, earlier this month Elon Mush weighed in on Germany’s February 23 election campaign by backing the AfD, with his trademark crudeness; Musk referred to the German chancellor as a “fool” and “Oaf Schitz”.
“You must vote for change,” Musk told Germans in a streamed conversation... And that is why I’m really strongly recommending that people vote for AfD,” Musk said during a Radio France International report over the weekend.
With the caveat that everything any government says is almost always propaganda, China seems to have emerged from Munich with its international reputation enhanced. Anyway, this was among the claims made by Argentina’s ambassador to China, Marcelo Suárez Salvia. As the US starts closing its borders and retreating into economic nationalism, Salvia praised China’s opening up, and the benefits of advanced digital payment systems, modern tourism infrastructure and exceptional services.
It’s not only “friends of China” who fear that America is unravelling, or at least the multilateral system that it created after World War 2. In a Financial Times oped headlined “The Real Threat to American Prosperity”, published at the weekend, Nobel prize-winning economist Daron Acemoglu looked critically at the waning influence of US trade wars and tech industry hubris in that country.
Things could spiral further out of control, Acemoglu suggested, and, alarmingly, that US institutions had fallen into a self-reinforcing vicious cycle (and) the world would progressively suffer from its failings.
In a world in which the US is losing political and economic power and influence, its only strength lies in its military power. I would wager that the next “great war” will be fought without guns, smoke or maybe even boots on the ground, through attacks on global supply chains.
At least 90% of the world’s money is transferred around the world without human touch. Imagine if that system is destroyed, what this would do to international commerce. A brief reminder is useful: before World War 1 wealthy business people also said war would be too costly and “bad for the economy”.
Anyway, with the US preparing for a kind of war the most idealistic of statements at Munich last week came from the Chinese, who insisted that a future world order should be based on equality among nations; respect for the rule of international law; strengthening multilateralism; and something that lies close to my heart — global governance that focuses on providing public goods for improving global governance, and indivisible standards of justice.
• Lagardien, an external examiner at the Nelson Mandela School of Public Governance, has worked in the office of the chief economist of the World Bank as well as the secretariat of the National Planning Commission.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.