Davos Men

Your moral betters prepare for their annual, world improving confabulation

(Source: Getty Images)

Bill Bonner, reckoning today from Paris, France...

Paris is gray. But not grim. People are out and about. Face masks have almost disappeared.  

But everybody grumbles…and in France, as in America, elite deciders are making everyday life harder. One thing: they’ve banned the use of outdoor heaters, which were ubiquitous in sidewalk cafes. You used to be able to sit outside near the gas heater and enjoy the street life. No more…

Meanwhile, we are working our way through a list of things that can go wrong. The World Economic Forum (WEF) calls it a “polycrisis.” We prefer the half-word “cluster” as it is more descriptive of the disaster to come.

Inflation, for example. The WEF’s Global Risks survey signals higher living costs as one of its near-term flash points. And here’s the latest. CNBC reports:

Inflation just dropped to 6.5%—but the 'most important' factor in predicting if it will keep falling is up 0.4%

In Thursday's CPI report, "services less rent of shelter" showed a 0.4% increase in December. …since wages are "the largest cost in delivering these services," [Powell] said, that might indicate out-of-control wage growth…

There is “sticky” inflation…and inflation of the Teflon variety. The non-sticky inflation includes things that go up and down readily – such as oil and commodities. The ‘sticky’ inflation comes from things such as wages and shelter, that don’t get marked-to-market on a daily basis.  

Yesterday’s numbers tell us that the sticky part may become a tar baby – hard to get rid of. In the ‘services including rents’ category, for example, prices are up more than 7%. Much of that is wages. And nobody takes a wage cut to fight inflation.

“Davos Men”

WEF is a sinister organization. It believes the common man is a dope – which, of course, he is. But it also believes that it – or rather its adherents, the great and the good from all over the world – are geniuses, which they are not. They are human too…just better at school…or better at getting their names in the paper…or simply lucky enough to have no tender feelings nor nuanced thoughts that might keep them from making fools of themselves. With no real weight – neither inner dignity nor outward-facing principles – they rise to the top, like plastic bottles, floating in a fetid swamp.

The list of attendees has recently been released. It includes the usual public policy jackasses…as well as a large group of people in private industry who have become “Davos Men” and are ready to lead the rest of us to the promised land.

The problem is that when you look more carefully at the land they are promising, it looks more and more like a prison. It is a prison constructed by true believers, who think they know what is best for us.  

Which brings us to their polycrises…and to our cluster. Included among the coming tempests – at the top of both of our lists – is the deflation of asset prices and the potential for a worldwide, 1930s-style depression. But looking out further…over 10 years… their survey focuses on bigger threats. Its top five are all related to ‘climate change.’ They think human activity is ruining the planet.

On our list, by contrast, in number 4 position, is a very different crisis – a man-made catastrophe, a little like the disaster in China of the ‘Great Leap Forward,’ in which 50 million people died – caused by an almost religious faith in ‘green’ power.

This Tilted World

WEF could be right. Maybe the planet really is warming. And maybe it will pose problems. But there are a lot of unknowns. Is the planet heating up because of something we do? We don’t know for sure. Is a warmer earth a bad thing? Don’t know. Could we stop it? We don’t know that either. Would we be better off if we tried…how much would it cost? Again, question marks. Would it be worth it? Who knows?

The risk we see is not a climate disaster, but a much more likely public policy cluster. The odds are in our favor. We know of no major, ambitious and costly public policy that wasn’t a catastrophe – from the Crusades and the Inquisition to the trenches of WWI and the jungles of Vietnam…all were disasters.

Yes, there are plenty of squishy unknowns in our cluster too. But the ground is dry.    Fossil fuels are 1) cheaper than green energy, 2) already in place and ready for duty, and 3) reliable; they do the job even when the sun doesn’t shine and the wind doesn’t blow.

Replacing fossil fuel with ‘green’ energy, even gradually, will almost certainly lower living standards. (Today’s standards of living depend on energy at today’s prices.)  In our developed world, we sit on a fat cushion of wealth, made possible by economies using traditional energy. Would lower living standards be a bad thing? We don’t know. But what about those billions of people who sit on hard benches…for whom air conditioning and automatic transmissions are still a dream? They live on $5 a day…and barely stay alive.  

We don’t know. But combined in a cluster of market correction, war, and other calamities, tilting the whole world towards an expensive and untested new energy system is risky. Some of the world’s 8 billion humans are bound to fall off.

Regards,

Bill Bonner

Joel’s Note: In a pop-up city, nestled in the lush countryside of one of the world’s richest countries, your enlightened (yet ever so humble) overlords will soon gather to discuss your future... your children’s future... and the future of the entire planet. 

Chances are, you’re not going to like what they have to say. But hear them out; it’s for their own good. 

Spirited on luxury private jets angel wings, thousands of personkind’s finest moral exemplars will journey to the World Economic Forum in Davos, Switzerland, next week to engage in an cloistered mass debate over how best to organize the miracle of life here on this precious blue orb. 

Where you can go, and when... How much you can spend, and on what… Which ideas are permitted and which constitute “misinformation.” What is is prohibited, and what is mandatory…

And because their own ideas are so very popular, the Davos Men will only need 5,000 members of the Swiss military to protect them from the plebeians outside the city gates. That’s in addition to the thousands of ordinary uniformed police officers that will be hitting the streets… and the fighter jets that will be patrolling the skies overhead. From the official SwissInfo.ch

Ten days before the 2023 edition, the military has begun work on security installations, the defence ministry said on Friday. Like every year, the military is supporting the civilian authorities in canton Graubünden in preparation for the major event.

It notes that the Swiss parliament renewed approval for 5,000 members of the Swiss army to guarantee the security of some 3,000 WEF participants for the years 2022 to 2024. The high-level event attracts wealthy, high-profile business and political figures from around the world, along with academics and other leaders of society.

Safety protocols (for them… not you), include “permanent patrolling by armed fighter jets, ground-based air defense, additional radars, increased airspace surveillance and air police service around the clock.”

All completely carbon neutral, of course. And fear not, obedient prole, while you’re being scolded for driving the kids to school in your soccer van and told “no more gas stoves for you!” your elites will be traveling to the event in private jets which, as we all know, run on compost and solar power. Hermès speed!