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In Davos, the global elite ponders on income inequality, lack of trust in leaders

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The heaviest snowfall to hit Davos in decades saw heaps of snow piling up high all around this scenic Swiss Alpine resort.

It made for breathtaking sights for the thousands of business and political leaders attending the World Economic Forum meeting over the past week. The experienced skiers among them would have relished the prospects of hitting the slopes packed with fresh powder.

Yet, an excess of snowfall also raises the risk of a sudden avalanche, when snow can come crashing down without warning.

This chilling metaphor was heard several times in discussions here, signalling an underlying anxiety among participants about what lies ahead.

In the past, after all, few had forseen political shockers such as Brexit, or looming financial crises, lying ahead.

So while the news that broke this week of global stock markets hitting new highs and economic growth forecasts being raised was cheered, this was tinged with an unspoken worry about the economic, environmental, social and political fragilities that still need to be minded.

At the heart of these concerns are growing income inequalities and declining trust among the people in political systems and leaders.

A much-talked about Oxfam study released just as participants were arriving in Davos on Monday showed that 82 per cent of the wealth generated last year went to the richest 1 per cent of the global population while the poorest half saw no increase at all.

This year’s Edelman Trust Barometer Index, a dipstick into levels of trust in societies, released this week, also showed steep falls in trust in many countries, especially in the United States, which saw a 37-point drop in trust across all institutions.

“The United States is enduring an unprecedented crisis of trust,” said Mr Richard Edelman, president and CEO of Edelman, who was here in Davos. “This is the first time that a massive drop in trust has not been linked to a pressing economic issue or catastrophe like the Fukushima nuclear disaster. In fact, it’s the ultimate irony that it’s happening at a time of prosperity, with the stock market and employment rates in the US at record highs. The root cause of this fall is the lack of objective facts and rational discourse.”

Lamentably, the study also found that the media is now ranked as the least trusted institution globally, distrusted in 22 of the 28 countries surveyed. Nearly seven in 10 respondents among the general public say they are concerned about fake news being used as a weapon, and 59 per cent say it is getting harder to tell if a news item is fake or is produced by a respected media organisation.

This sharp drop stems largely from a decline in trust in media platforms, notably search engines and social media. Amid the proliferation of fake news and false information, trust in journalism has rebounded and is up five percentage points. Credible voices showing expertise have also gained trust, with journalists up 12 points, CEOs up 7 points and technical experts and analysts also seeing a rise in their trust numbers. In contrast, confidence in “people like us” as a source of reliable information has fallen to an all-time low of 54 per cent.

Noting that this is both good and bad news, Mr Edleman told a gathering of editors attending the International Media Council session, as part of the WEF meeting: “There is both a challenge, and an opportunity, for mainstream media organisations here, to help establish levels of trust in society.”

This is significant, as the lack of faith in the media feeds into the public’s inability to identify the truth (59 per cent), trust government leaders (56 per cent) and trust business (42 per cent), the Edleman survey had concluded.

Making this point in an interview with The Straits Times at the close of the week-long meeting, Minister in the Prime Minister’s Office Chan Chun Sing argued that trust has taken a hit because some governments had failed to deliver on the promise of better lives through globalisation and free trade. The spread of fake news on the Internet has also left voters wondering who or what information they could trust.

Both of these have undermined trust, he said, as workers who feel left behind wonder if it is their leaders or the media who are oblivious to the ecomomic and social problems they face, or deliberately downplaying their plight.

Either way, the political implications are serious, as a report by Swiss bank Credit Suisse released here last Tuesday, titled The Future of Politics, revealed. In it, former British Prime Minister John Major notes how a “disillusioned, disinterested, preoccupied” electorate is “shrugging its shoulders and turning away from politics”.

“In such a climate, democracy faces a threat from the rise of nationalism. This is not theoretical: in many countries it is a reality. In others, a clear and present danger.

“My worry is that democracy is in retreat, stifled by its own virtues. Across Europe, nationalism has gained more than a foothold. It begins with a populism that masquerades as patriotism, but morphs into something far less attractive.”

Sharing this rather bleak view, Harvard professor Larry Summers wrote in the Financial Times: “In countries as diverse as the US, UK, Turkey, Russia, Israel and China, it appears that the governmental platform that commands the most popular support is rooted in nativism, nationalism and negativism. Populist nationalism eventually produces bad economic results, leading to more pressures for anti-establishment leadership and for extreme policies. It is far from obvious what reequilibrates the system.”

Little wonder then that this drift to populism and nationalism was a cause of much concern here among Davos participants, longstanding cheerleaders for globalisation, free trade, open borders and social inclusion. Many speakers took up the theme and called for action to address the underlying causes.

The charge was led by the youthful French President Emmanuel Macron, who said it was time to “push back against nationalism and nativism“. Delivering an impassioned, hour-long speech, from notes and without teleprompters, he called for a new global compact to address the forces that led to rising inequality and populism, noting his own battles against these in his election campaign last year.

“We have a situation where people are being told, on social and financial issues, that the answer is to do less, to cut our taxes, there is no limit, it’s a race to the bottom.”

“If we aren’t able to agree on a standard of international cooperation, we will never convince the middle class, the working class, that globalisation is good for them,” he said, calling for sweeping reforms of global tax and trade systems to ensure that globalisation works for the common man.

He also added that leaders had a duty to speak honestly with their voters about the challenges they needed to address, rather than offering them quick, easy, populist pitches, which ultimately undermined trust.

Taking up the line of argument, Swiss president Alain Berset added that the broad sweep of society needed to be convinced that globalisation works for them. “People want to feel they can control the forces of globalisaiton and change. Otherwise, they will use their vetoes at the ballot box. Most people don’t oppose openness and change. But they want to feel secure. They want access to economic opportunities.”

In Singapore, thankfully, trust levels in key institutions, from government to the media have remained high over the years, going by the Edleman findings. Trust in the media in Singapore, at 52 points, is the sixth highest in the world. Mindful of the importance of upholding this trust, the government has convened a Select Committee to study how best to address the challenge of fake news.

For, as Mr Chan noted, this intangible aspect of trust, along with delivering tangible benefits as promised, were both critical in building up the people’s belief in the system and their leaders.

“For Singapore, every generation of leadership, regardless of who forms the government, must firstly be able to deliver a better quality of life and standard of living for the people. People must have the sense that they have the opportunity to realise their dreams, especially for the next generation, their children….Then, there is the question of how you can build trust because you are upfront, forthright, honest about the challenges and options that the country has to confront together.”

“If we don’t manage these two aspects well, then we should not make any presumptions that we will garner the trust of a new generation,” he said.

This critical importance of leaders meaning what they say and saying what they mean was captured best in the closing moments of this year’s meeting. While the participants might not think much of the populist America First approach taken by US President Donald Trump, they listened patiently and applauded politely when he wrapped up his speech, which was surprisingly lacking the fire and fury that some had expected.

But they hissed in disapproval when Mr Trump described the media as “nasty, vicious, and fake”. The much respected WEF founder and executive chairman Klaus Schwab also raised eyebrows when he remarked that the American president had been “subject to misconceptions and biased representations”, and later called his rather lacklustre speech “inspiring”.

It might have been a passing comment, signifying nothing, but it also made plain how easily trust and credibility can melt away, just like the snow on the ground, as the sun emerged yesterday to glisten on the lovely Swiss Alps, as delegates made their winding way home.

straits times



70 Comments on "In Davos, the global elite ponders on income inequality, lack of trust in leaders"

  1. Mad Kat on Sat, 27th Jan 2018 9:41 pm 

    So, Davy, you equate Arizona… a desert…with a tropical climate? Interesting! Grabbing at straws again? You are the one living a precarious life, not me. Better run to Italy before the gates are closed. Hurry! LMAO

  2. Mad Kat on Sat, 27th Jan 2018 11:47 pm 

    More of American folly: “By ignoring the facts related to 9/11, the public has prepared itself to be terrorized on a regular basis. Recurring acts of terrorism follow a formula that is transparent to anyone who cares to examine the evidence beyond simply accepting corporate media reports….

    The government reports on the destruction of the WTC buildings ignored basic laws of science and would have failed peer review. Meanwhile the only actual peer-reviewed science on the subject, for example this, and this, and this, and this, went unheeded. …

    https://digwithin.net/2018/01/21/the-terrorism-lottery/

    “The lack of objective examination of terrorist acts suggests that we might as well stone to death future victims because it is the public’s apathy that allows terrorism to continue.”

    Slip slidin’ …

  3. GregT on Sat, 27th Jan 2018 11:49 pm 

    If MM has a PhD at 30, he likely has at least a quarter of a million dollars in debt. If not, he’s been leaching off of mommy and daddy. If I was his dad, I’d be kicking his ass three ways to Sunday, for being such a useless, and lazy POS.

  4. MASTERMIND on Sun, 28th Jan 2018 1:25 am 

    Madkat

    I am not the one squealing about the deep state! And how can a un educated construction worker judge who is sane or not? If I need my toilet fixed from taking a big shit I will call you okay! Stay in your lane old man!

  5. MASTERMIND on Sun, 28th Jan 2018 1:38 am 

    Greg

    Hey if I knew society was going to collapse in the near term I wouldnt have gone to college! I am just lucky I never had any kids! At least none that I know about! LOL

  6. MASTERMIND on Sun, 28th Jan 2018 1:41 am 

    Greg

    I have never leached off mommy and daday. Ever..My dad didnt work for the government like yours did! I have worked since I was 13! First job was on a farm!

  7. MASTERMIND on Sun, 28th Jan 2018 1:42 am 

    Greg

    You cant legally work till you are 14. But if you work on a farm the laws are different. I doubt you would know that because I am sure your daddy who made great money from the tax farm didnt force you to work at a young age!

  8. Davy on Sun, 28th Jan 2018 2:22 am 

    “So, Davy, you equate Arizona… a desert…with a tropical climate? Interesting!”

    Space is space when you are talking about that amount of people, billyT. Besides your fishery and forest are in decline and localized failure. A significant amount of the country is mountains or jungle. You are grabbing straws if you think you can argue carrying capacity away.

  9. Mad Kat on Sun, 28th Jan 2018 2:38 am 

    No, Davy. Space is NOT space. If that were so, then Antarctic would have a population of ~500 million as it is almost twice the size of the US. You are spewing bullshit as usual.

  10. Mad Kat on Sun, 28th Jan 2018 2:45 am 

    And do you think that mountains and jungle are NOT food productive? Just bananas and coconuts are everywhere by the millions. They grow wild like your dandelions. You are obviously uneducated about the Ps and will remain so because your mind is blocked by your arrogance and hate of any country that is better than your SHITHOLE US.

    You don’t need big plowed fields to grow food in abundance. Did you ever hear of permaculture? You are a big ag, petro reliant wannabee farmer, if you actually have a farm. You will not be even close to self-sufficiency after TSHTF and your support system vanishes.

  11. Davy on Sun, 28th Jan 2018 2:54 am 

    “No, Davy. Space is NOT space. If that were so, then Antarctic would have a population of ~500 million as it is almost twice the size of the US. You are spewing bullshit as usual.”

    Sure it is billyT, in 1900 pre-fossil fuels and with a healthy environment the P’s had 10MIL people. Now the P’s has 100MIL and addicted to fossil fuels with forest and fisheries in decline and localized failure. Cities have vast festering slums. There are wonderful areas too but having 100MIL people and growing ensures their health will be affected adversely. You are, as you say, grabbing straws and lying to yourself.

  12. Davy on Sun, 28th Jan 2018 3:01 am 

    “And do you think that mountains and jungle are NOT food productive? Just bananas and coconuts are everywhere by the millions.”
    Enough to feed 100MIL people? I agree, if and or when SHTF your little jungle old folks home will be overrun and swept cleaned by locust hordes looking for bananas and coconuts. Filipinos are nice people but they have to eat. BTW, how is the fantasy farm going? You were supposed to be there by now. More delays huh?

    “Did you ever hear of permaculture?”
    Well I know more about permaculture than you billyT, you live in a condo and the extent of your permaculture is a little banana tree.

    “You are a big ag, petro reliant wannabee farmer, if you actually have a farm. You will not be even close to self-sufficiency after TSHTF and your support system vanishes.”
    That’s funny billyT because you are always bad mouthing my goat and cattle permaculture farm and now you are saying it is a big Ag petro reliant farm? What is it BillyT, jealousy that I actually farm and have a garden, vines, and orchard. I have real animals not a pet cobras and monkey troops in my fantasies.

  13. Mad Kat on Sun, 28th Jan 2018 3:53 am 

    Davy, ou probably don’t have any farm. Maybe you are in what used to be called an insane asylum allowed to take your frustrations out on the internet? No proof of any claims here, is there? You could be a butch female for all we know.

    YOU are the jealous one. I am safely out of the gulag. You are trapped. I am secure in my future here. You will never be secure as a tax slave in police state America. YOU are the one reliant on JIT deliveries 24/7/365. I’m not. I can easily live on rice and fish, both grown locally near the farm. And, oh yes, the farm has crops that have been marketed for the last four years. You do not have to live there to be productive. Pineapple, taro, jack fruit, etc. are all current crops.

  14. Davy on Sun, 28th Jan 2018 4:09 am 

    “Davy, ou probably don’t have any farm. Maybe you are in what used to be called an insane asylum allowed to take your frustrations out on the internet? No proof of any claims here, is there? You could be a butch female for all we know.”
    Sounds like something someone who just got their ass kicked would say. This is typical from you because I neuter your vomit daily and I am sure popping you agenda bubble hurts.

    “YOU are the jealous one. I am safely out of the gulag. You are trapped. I am secure in my future here. “
    Sounds like cognitive dissonance for someone who may have made a big mistake moving so far away from family and his support system now that he is getting close to needing to going to a nursing home.

    “You will never be secure as a tax slave in police state America. YOU are the one reliant on JIT deliveries 24/7/365. I’m not.
    Sure you are billyT, lol. This is the way the P’s survives like any other nation. You just fantasize that 100MIL people in a space the size of Arizona all live in idyllic farms and fishing villages. The reality is much different.

    “I can easily live on rice and fish, both grown locally near the farm.”
    First you have to get to the farm and all I have gotten out of you for 5 plus years is talk. You don’t walk the walk you talk. I like fish and rice too. I have no problem with it, yum, so what? Does that make you superhuman?

  15. jmm on Sun, 28th Jan 2018 4:20 am 

    the rich stinkers can only win the trust if they return their stolen money back to the poor population ….

  16. jmm.peters on Sun, 28th Jan 2018 4:20 am 

    the rich stinkers can only win the trust if they return their stolen money back to the poor population ….

  17. Mad Kat on Sun, 28th Jan 2018 4:56 am 

    Davy, you are sounding very childish. Get over it and grow up. “My daddy’s meaner than your daddy! Nah nah ney nah nah!” You are not the top dog here. not even a yappy chihuahua. A zero.

    You are only great in your own mind. No one else believes it. You display your arrogance and lack of world education and experience with every post. Stuck in the gulag called America, with no options other than suicide.

  18. Davy on Sun, 28th Jan 2018 5:06 am 

    “Davy, you are sounding very childish. Get over it and grow up. “My daddy’s meaner than your daddy! Nah nah ney nah nah!” You are not the top dog here. not even a yappy chihuahua. A zero.”
    Are you telling on yourself again billT? You are the one peddling the agenda of how great you are and how bad everyone else is. Get a grip when you are an extremist peddling hate for others and self-advancement you are going to be easy to neuter. I do it daily and it is apparent it is working.

    “You are only great in your own mind. No one else believes it. You display your arrogance and lack of world education and experience with every post.”
    Again more telling on yourself and very precisely IMA. Funny how that works.

  19. twocats on Sun, 28th Jan 2018 8:41 am 

    “The root cause of this fall is the lack of
    objective facts and rational discourse.”

    the underlying thread of sentiment at Davos (according to the article) is that Americans are too stupid or manipulated to realize how good they’ve got it – with the stock market at all time highs and historically low unemployment. dear god why didn’t you bury these evil morons in an avalanche!

  20. twocats on Sun, 28th Jan 2018 8:48 am 

    “the rich stinkers can only win the trust if they return their stolen money back to the poor population ….”

    exactly jmm. and also they are unwilling to admit (or realize) that the system they’ve created is entirely to benefit THEM, not the vast majorities of humans. It’s not just about money – it is about control. they’ve got the control and they’re not giving it up.

    “People want to feel they can control the forces of globalisaiton and change.” Swiss president Alain Berset – yeah- that’s impossible you moron (this guy is a President !!) I’m sure there are plenty of people at Davos who agree with me and are silently minding the store to make sure it isn’t given away, and are just waiting for the day it teeters over, collapses, and then they will rebuild.

    I used to think those movie villains who are always like “I must destroy the planet (or universe) in order to rebuild it correctly” was just the stupidest thing ever. Now I’m not so sure that’s not a commonly held opinion amongst poor and rich alike.

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