The theme of the recent World Economic Forum Annual Meeting in Davos was Creating a Shared Future in a Fractured World. These fractures – Brexit, the Trump presidency, the rise of automation and artificial intelligence, the re-emergence of China – were on full display across the conference agenda, both in the main Congress Hall and in the many side events that drew a record crowd to the beautiful Swiss mountains for the 47th time.
Set out below are the major issues that attendees discussed and a recap of debates that ran hot among the cold slopes of the Graubunden. As WEF 2018 ended, those fractures were still quite evident. But diagnosticians of every persuasion were hard at working trying to heal the world, and some splints had been applied.
- The love affair with tech is over: The gathering anti-tech momentum, gaining observable strength in the media zeitgeist for the last six months, was on full display at this year’s event. For at least the last 10 years, the prevailing sentiment at Davos has been that technology equals disruption, disruption equals opportunity, resistance is futile, don’t be a Luddite, get with the program, call 1-800-insert-consulting-firm-name-of-your-choice. This year, that conviction was less assured. Voices from across the board questioned what tech hath wrought and what it is doing to our children, our body politic and the institutions at the heart of our societies. From Theresa May to George Soros to Roger McNamee to the Financial Times to the WEF itself, difficult questions were being raised that tech entrepreneurs and evangelists have debated in private but preferred to ignore in public.
Though most of Davos is underwritten by tech (certainly the best parties), the big beasts of the tech jungle were curiously sotto voce in their “we’re still not evil” advocacy. Perhaps they were rope-a-doping. Perhaps they’re hoping that this too shall pass. Perhaps they’re really not quite sure what to do. (One aside here: Tech doesn’t help itself when casual eavesdropping along the main drag through town surfaced attendee after attendee talking about “time banking” and the “circular economy” in a way that positions them, in my mind at least, as writers from Black Mirror doing research for Season 5.)
- Waiting for the Data Valdez: Central to the difficult questions on profiling, targeting, privacy, surveillance, attention-addiction and authenticity is data. As I commented on in my last dispatch from Davos, the use of the primo resource of the 21st century is becoming ever more complex as its power is more fully understood. We may not have had a full-on “data tanker” spill yet, but the perils of “data leakage” were top of mind at many of the sessions I attended, and in many late-night (with adult beverages in hand) conversations, from which the “Davos consensus” really emerges. For many from the new world, the old world’s focus on data misuse is a bore. For many from the old world, the new world’s disinterest in data misuse brands them as charlatans. My sense of Davos 2018 was that the old world’s grip of the gavel was strengthening, and that there was a growing acknowledgment – among every attendee, no matter where they called home – that establishing “rules of the road” for the information superhighway was inevitable and, in truth, probably long overdue. A “Data Valdez” incident (presumably imminent) could take a whole lot of cleaning up.
- Have you met Ms. Gabriel? : That this regulatory push is coming most aggressively from Europe (Brussels to be precise, and even more precisely, the European competition commissioner Ms. Mariya Gabriel), however, adds a huge layer of complexity to the leading-edge tech arms race. As leading IT industry analyst (and, incidentally, Russian President) Vladimir Putin put it recently, “whoever controls AI will control the world.” Pointed out by numerous speakers at different events was the uncomfortable truth that – at a conference in the middle of Europe – none of the leading tech companies that are now the leading companies in the world, period, are European. While Europe has its pockets of tech leadership (Deep Mind in London, though part of a California-based Alphabet soup, and Spotify in Stockholm), dominance (if not control) of AI and data analytics and cloud computing and social media is now a Sino-American duopoly. (At least in the above-ground Internet; leadership of the “dark web” is an entirely different matter.) Yet European politicians, conspicuous in their presence in Davos, are seizing the initiative to create legislation that will shape the evolution of technology worldwide in the coming years. U.S. companies will resent this and see a hidden agenda of “handicapping.” Chinese companies will ignore the edicts and missives of European officials. As one leading Chinese tech executive was reportedly overheard saying at a behind-closed-doors dinner, “You (i.e., the West) have already lost. You just don’t know it yet.”
- Demographics is destiny: Speaking of China, the continuing rise of companies like Alibaba and Tencent, the growing assertiveness of its political leadership and its obvious economic strength was, as in 2017, the talk of the town. Though President Xi didn’t make the long journey from Beijing this year, plenty of his fellow country(wo)men did. Davos attendees, keen students of history and attuned to big shifts in macro trends, can see only too clearly the parallels between the transition from British to U.S. leadership in the first half of the 20th century and American to Chinese leadership in the first half of the 21st century. Whether this transition is a fait accompli (as the Chinese executive above was suggesting) is, of course, highly debatable. The many fault lines in Chinese society (lack of true democracy, civil rights, international “soft” power, etc.) will be stress-tested and widened by an America that won’t cede its top-dog status without a struggle (a fight?), no matter who sits behind the Dreadnought desk. Whatever China’s trajectory over the next few years and decades, its role on the international stage will become more and more prominent (based on demographics if nothing else), and Davos, as the ultimate international stage, will no doubt see more and more evidence of this in the years to come. (Note to self: Set up a high-end Chinese restaurant in Davos – there aren’t any currently.)
- Mr. Trump goes to Davos: Speaking of America’s perceived decline, President Trump visited Davos (the first visit by any U.S. president since Bill Clinton in 1992) and gave what was widely regarded as a surprisingly OK speech. Though the regular habitués of the WEF’s annual event were the primary target of Candidate Trump’s stump speech circa 2015-2016, they largely emerged unscathed from the convention hall at the end of the President’s 30-minute speech. Mr. Trump’s message was that yes, it is America First, but not American Alone. Wags commented that the President’s speech was more a used-car sales pitch than the usual political jeremiad to the real masters of the universe. Cynics though they may be, attendees’ overriding sentiment regarding the President at the end of his first year was, “We were expecting a lot worse” – a sentiment of course reflected in record stock market highs and the lines of Fortune 500 CEOs trying to get into the hall to take an action selfie with The Donald.
- Jobs, jobs, jobs: Of course, key to President Trump’s messaging is the issue of jobs. And when one speaks of jobs, one speaks of the future of work. We were delighted that it was standing-room-only at our event sharing our “21 Jobs of the Future” report, at which we laid out some of the new work emerging in an AI- and automation-filled world. J.P. Gownder from Forrester Research joined us on our panel, and a lively debate ensued as our guests chewed on our food for thought and came up with some of their own new jobs too. Amid much of the “workless future” dystopia that was certainly on display along the snowy Promenade, it was good to find many fellow travelers who see possibility and potential in the “new tools of the trade.” Hope and optimism are seemingly among the rarest of commodities at the moment. Perhaps that’s why many of the attendees appeared to value the session so much. (For more on this topic, see the video from our “21 Jobs” event at WEF 2018.)
- No scarcity of blockchain & AI “experts”: With the Alps looming in the background through every meeting room window, I had the odd sensation by around midday Wednesday that the scenery itself was made up of Gartner Hype Cycles, with blockchain and AI high up on the craggy summits. Sessions on Mr. Nakamoto’s Impenetrable Double-Entry Bookkeeping System in the Sky (you heard that here first) and TensorFlow and the Future of Whatever Your Job Description Tells You You’re Responsible For (another Pring TM) were as thick on the ground as the Monday night snow. My sense was that a small number of attendees were deep into blockchain and AI and keen to talk implementation, practicalities and return on investment, while a large number of attendees had read The Economist articles about them on the flight to Switzerland and were dealing with the “shock of the new.” I’m with Wittgenstein; “whereof one cannot speak, thereof one must be silent.” Not the case for the typical Davos attendee.
- The purpose is purpose: The World Economic Forum’s Annual Meeting started in 1971 with an emphasis on discussing, as it said on the tin, the state of the world’s economies. Over the years, this mission has expanded to include just about anything anybody wants to talk about who has enough money and “star appeal” to draw a crowd. (This year, Elton John announcing in virtual reality his three-year-long retirement tour.) During the last 20 years (as mentioned above), this has seen the event become majorly tech-heavy. Now, more noticeable than ever, the new theme of Davos has increasingly been oriented around philanthropy and what is increasingly being called “purpose,” or “Ikigai,” in Japanese, from whence the notion stems. Nonprofit organizations, ranging from charities seeking to eliminate intestinal worms, to advocacy groups trying to raise awareness of glacier diminishment, were heavily represented across the formal sessions within the Congress Hall and in the many “fringe” events that happened across town. Where once these groups were low-key and low-profile, this year they were increasingly visible and center-stage in the discussions held by banks, consulting firms, tech titans, venture capitalists and money managers. Indeed, it is the most famous of money managers, Larry Fink of BlackRock, who at Davos this year galvanized this rising tide of noneconomic economic talk with his annual letter to the leaders of companies he invests in, stating that it was about time they started running their businesses with something other than simply shareholder value in mind. Given that this has been the main rule of the Davos game since Milton Friedman’s Chicago School of Economics became preeminent in the 1970s, this is a significant moment. The notion of inclusive capitalism has been gathering steam for a number of years, and prominent leaders like Prince Charles and Salesforce.com’s Marc Benioff have been vocal proponents of an economic model that tries to balance the needs and requirements of a range of “stakeholders” – employees, partners, the environment, nonprofits, etc. – rather than simply try and satisfy those who own shares in an organization.
Fink’s letter, though, has concentrated minds that typically don’t concentrate on complicated issues like these. Attendees at Davos 2018 sense that in a Brexit/DJT world, the wind has shifted, and wondering what Gordon Gekko would do (Michael Douglas sadly absent from this year’s event) is no longer an optimal, career-lengthening strategy. Whether this is just a passing fad will take time to ascertain. A stock market crash or full-scale cyber war (appearing in my tea leaves) may derail this higher order pursuit. But on the other hand, maybe Davos 2018 presaged a growing realization that it’s time the enlightened bourgeoisie began to show some enlightenment.
Whether Davos 2018 managed to start the process of fixing fractured economies, institutions and countries is too early to tell. It seemed to me that much diagnosis of the ills of the world was under the microscope, but that there wasn’t much consensus on the best medicine to bring the patient back to rude health. What was clear was that whereas at last year’s event, there were attendees genuinely in shock at the recent turn of events (and at their inability to forecast what had just happened), the mood this year was much more of acceptance and “keeping calm and carrying on.”
As I wrote in my wrap-up of last year’s event, those who live by the sword of disruption were seemingly struggling to realize that they could die by the sword of a disruption they had missed. This year, much of that disruption has been processed and semi-contained. Fractures are still evident – but perhaps not quite as painful as they were 12 months ago.