The Global View

Davos: A chance to, finally, reform the global economy?

financial-crisisWe still have a chance to resolve our critical economic and climate problems, but only if the people gathering for next week’s World Economic Forum in Davos show a level of leadership that’s been sorely lacking up until now, according to a London-based economist and author.

“After the failure at Copenhagen and with the G20 stalemated, Davos has an opportunity and responsibility to break the logjam in the reform of the global economy,” says Michael Green, co-author of the book, “Philanthrocapitalism: How the Rich Can Save the World.” “If Davos wants to run the world, it has to show some leadership.”

In their book, Green and co-author Matthew Bishop argue that governments alone can’t successfully tackle such global problems as poverty and climate change. Instead, they say, building a sustainable future will require innovative partnerships involving wealthy entrepreneurs, business leaders and non-profits, as well as governments.

The theme for this year’s annual WEF meeting, set for 27 – 31 January, is “Improve the State of the World: Rethink, Redesign, Rebuild.”

Green says this year’s WEF is uniquely placed to set an agenda for positive change … if participants make the most of the event’s freedom from tiresome diplomatic protocols to take action.

According to Green, that will require new thinking on:

  • Financial reform: We need to figure out how to rewrite the rules in a way to make banks more responsible without tying them up in red tape.
  • A new monetary order: The financial super-bubble that burst in September 2008 had been inflated by the endless supply of credit flowing into the US from emerging economies running huge trade surpluses. The global economy won’t be out of the woods unless we can fix those imbalances in global finance.
  • A “New Deal” between the rich world and the poor one: The less-than-spectacular outcome of last month’s climate talks in Copenhagen demonstrated that we’re at risk of a global impasse in which the poor won’t act because the rich won’t pay.

What do you think? Are governments increasingly hobbled and unable to take action on their own to resolve our most pressing problems? Will the next “New World Order” be created not by elected officials so much as by rich “philanthrocapitalists”? Let us hear your thoughts in the comments section below.