It is becoming something of a cliche here to say the mood at this year’s Davos is so depressing that it is feeding the recession, rather than building a consensus on how we escape from our predicament. CEOs who arrived a little anxious about their prospects are now very worried. Those who arrived worried are now deeply depressed. Those who arrived depressed may not go home at all.
I began to wonder if this Spenglerian gloom was a financial sector phenomenon. Two invitations to talk to the automotive sector, and the Tourism and Travel group, gave me an opportunity to test that hypothesis. Sadly, it quickly folded.
I took part in a luncheon discussion on the ‘post-carbon’ economy. This very term, ‘post-carbon’, is an obviously optimistic, future-forward theme in a time when oil and coal consumption is surging. Finding consensus here towards far-reaching solutions feels like a distant hope. In fact, our looming ecological crisis mirrors our present economic crisis in disconcerting ways.
Both these crises, for instance, happen to be triggered by market failure. The absence of any accounting when it came to environmental costs, and our failure to price natural resources into the economy have brought about the climate crisis. The financial collapse represents the same case of ‘disastrous optimism’ – our overlooking of ‘negative externalities’ in financial reporting, balance sheets and risk assessment. And in both these cases, we have tried to privatise profits and socialise losses.
There is a lot of gloomy talk about the recession but there is another conversation here that perhaps points to some green shoots desperately pushing their heads through the Davos frost.
The narrative goes something like this. Yes, we are facing one to two years of recession followed by a slow recovery. But during this period the opportunity exists to make major strides in certain areas, the main one being climate change initiatives, and that’s getting people excited. It’s giving people something to focus on and when two thousand global influencers focus on the same thing, you get the sense that something might just happen.