Is woke-washed capitalism over?
We may just be witnessing the slow, painful death of Davos man
Admittedly, I’d been distracted by a heavy workload and the Australian election, but I was completely unaware that the world’s plutocrats and their (usually) faithful retainers in academe, the corporate media and the political class recently conducted their annual feel-good jamboree in Davos.
When I did see an article about the event a few days ago, my first thought was, ‘Oh, are they still holding that?’ Of course, there is no reason they shouldn’t be, but I reacted as if I’d heard Bob Geldof had recently roped in the likes of Queen, Phil Collins, Elton John and Eric Clapton to put on a benefit concert for starving Africans. Or that they discovered a centenarian Japanese soldier on some obscure South Pacific island who was unaware that Emperor Hirohito had conceded eight decades ago that “the war situation has developed not necessarily to Japan's advantage”.
Et tu, FT?
It’s fair to say the article that alerted me to the existence of Davos 2022 had a somewhat snarky tone. The journalist, who was in attendance, noted:
Despite all the talk over the past several decades about stakeholder capitalism and “doing well by doing good”, the state of the world isn’t improving. Indeed, I would argue it’s getting worse, and a large part of that is down to the fact that, even as business talks about curbing emissions or improving education or bolstering healthcare, it is all too often undermining the public sector, which is responsible for making those things happen…
Western business leaders have for many years blamed governments for not delivering on basic public services. But blanket privatisations and the neoliberal race to the bottom for offshoring wealth and labour has ensured that it’s harder and harder for them to do so…
Business is never willing to acknowledge its own role. Too many chief executives prefer to have endless and (often) empty and fruitless conversations about “stakeholder initiatives” and “public-private partnerships”. None of which is making up for the basic hollowing out of public services in many liberal democracies…
Was the reporter a wild-eyed leftist writing for the likes of Green Left Weekly or The Guardian?
Nup, Rana Foroohar is a business columnist who contributes to the Financial Times. And you know you’re living in strange times when the Financial Times, which has spent the best part of a century and a half championing free trade and free markets, feels the need to call out the comical self-delusion and rank hypocrisy of “the world’s top leaders from politics, business, civil society, academia, media and the arts” who heroically gathered during “a watershed moment in history… to tackle global issues and find solutions to the world's most urgent challenges including the ongoing global pandemic, the war in Ukraine, geo-economic shocks and climate change.”
Yes, Thomas Friedman, globalisation just might be dead
Davos Man apparently isn’t completely devoid of self-awareness. There was at least one panel at this year’s overclass circle jerk devoted to the death of globalisation. Inevitably, Thomas Friedman reassured his audience that rumours of globalisation’s death were being greatly exaggerated. Magnanimously, Friedman did concede globalisation had some downsides, which had resulted in some ill-conceived pushback, but insisted that “globalisation is not over in the least” and still made his heart “go a little pitter-patter”.
I’m sure many CEOs, tech company founders and business school professors, having been blindsided by the one-two knockout punch of Brexit and Trump in recent years, were delighted to accept the Gospel according to Thomas, but colour me sceptical.
At this point, it’s necessary to distinguish between globalisation and what is typically labelled ‘Fair Trade’. Nobody but a handful of nutjob Autarkists (shout-out to Kim Jong-un!) denies the existence of comparative advantage and the benefits of nations trading with each other. As someone who drives a German car, has a South Korean TV, wears Chinese clothes, writes on a Swedish desk, watches French films on US streaming services and frequently does work for businesses based in the US, the UK and Singapore, I’m certainly not keen to go back to the 1970s. (I’m just old enough to remember when Australians had to save up a year’s salary to purchase a locally manufactured Ford or Holden that would invariably fall apart within 5-10 years.)
On the other hand, neither am I delighted to live in a world where many first-world employers can tell their workforces, “Nice-paying job you have there; it would be a shame if I had to outsource it to a country where I don’t need to worry about pesky unions or uppity staff members.”
And, further to the Financial Times article’s main point, nor am I keen to live in a world where the world’s largest and most profitable businesses pay little or no tax, demand generous corporate welfare, and then rub salt in the wound by relentlessly engaging in moral preening because they’ve introduced gender-transition leave or slung a few bucks to Black Lives Matter.
Someone always has to take it too far
In a Friedmanite (Thomas, not Milton) spirit of magnanimity, let me concede that globalisation, especially early on, did have its upsides. Businesses protected by high tariff walls do tend to get lazy and complacent, as do their workforces. Economically, it make sense for Australia to concentrate on mining, agriculture and tourism rather than trying to prop up a domestic car industry or get into semiconductor manufacturing. Hundreds of millions of people in Asia did ascend from medieval levels of poverty when advanced Western nations outsourced much of their manufacturing to countries such as China, Vietnam, Malaysia and Thailand. Nike founder Phil Knight was almost certainly right when he observed that even the most desperate American workers don’t want to spend their lives toiling in a Dickensian shoe factory.
But as is always the case with true believers, Mont Pelerin Society members overreached while remaining dangerously oblivious to the backlash they were engendering. They reaped the whirlwind with the rise of left-wing then right-wing anti-globalism. (Interestingly, anti-globalisation was most associated with the Left and tertiary educated, culturally middle-class types back in the 1980s and 1990s. It didn’t become a potent political force until it was embraced by significant sections of the Right, which then went on to enjoy significant electoral victories by appealing to ‘left behind’, culturally working-class types.)
How is globalisation working out for you?
Like communism, globalisation looked good on paper but didn’t pan out the way its cheerleaders predicted in the real world. (Of course, that could just be because it hasn’t yet been properly implemented.)
China is the marauding panda in the room in any discussion about globalisation. When Bill Clinton facilitated the Middle Kingdom’s entry into the World Trade Organization, he confidently declared that this would entangle China more deeply in a rules-based international system and change China internally.
Here’s Slick Willy stumping for an agreement to allow China into the WTO in 2000: “The W.T.O. agreement will move China in the right direction… if you believe in a future of greater openness and freedom for the people of China, you ought to be for this agreement. If you believe in a future of greater prosperity for the American people, you certainly should be for this agreement. If you believe in a future of peace and security for Asia and the world, you should be for this agreement.”
Two decades on, how’s that working out?
Pretty much everyone was supposed to get rich from globalisation. People in developing nations would go from planting rice in paddies to labouring in car factories, and people in developed nations would go from doing manufacturing gruntwork to creating smartphones, derivative markets and cutting-edge pharmaceuticals.
How’s that been working out for anyone other than the top quintile of income earners in nations such as the US for the last four decades?
And now that I think about it, didn’t Thomas Friedman slap a bright new coat of paint on capitalist peace theory and proclaim at the turn of the Millennium that no two countries with a McDonald’s would ever be so economically self-harming as to go to war with each other?
To be fair, there are currently no McDonald’s operating in Russia. We should really start to worry if Xi Jinping suddenly encourages Cultural Revolution-style attacks on his nation’s 4000 odd Maccas.