Public ideas

From Davos – optimism and pessimism, expansion and contraction

After a pandemic-induced break in 2021, the World Economic Forum met again this year in its usual location, Davos, Switzerland.

In comparison with the mundane economic discussions in our election campaign (deficits, traditional economic indicators, gotchas) the Davos agenda was wide-ranging and expansive, all in an economic context.

A brief summary of its main discussions is on its web page Davos 2022 - what just happened? 9 things to know. Those 9 things are the outlook for the world economy, the future of globalization, climate change and energy transformation, the war in Ukraine, food and energy crises, the future of work, technology and the metaverse, the role of business and entrepreneurs, and health matters.

Its short-term economic outlook is pessimistic. In most of the world real wages will fall, inflation will be difficult to control, and globalization will be in retreat as firms react to supply-chain disruptions caused by Covid-19 and the war. (Think of the likelihood of our forcibly reserving gas for our domestic market.)

It has several posts on the future of work to be found on its link Traits of the workforce of the future. The authors paint a picture of a world where workers, in strong market positions, can expect to enjoy meaningful and challenging work, with opportunities for continuous development and training. It’s a liberal vision, accommodating people who have often been pushed to the economic sidelines, such as refugees and people with disability.

These Davos documents reveal a way of thinking about work that contrasts with the nineteenth-century master-servant model that dominates our public policy debates. In the election campaign a politician aspiring to stay in office as prime minister was able to state his economic policy as “jobs, jobs, job, and jobs”, and politicians and journalists argued about the minutiae in employment numbers with little regard for the nature of people’s working life. That nineteenth-century model is based on the paternalist notion that the corporation owns the important means of production and offers a “job” to the dependent worker, who brings nothing but his or her brawn and a basic 3R education.

But the industries that are creating wealth now and will create wealth in the future are those where the real capitalist is the person who brings to the workplace (wherever that may be) his or her own embodied capital – human capital.

The Coalition doesn’t understand how the world of work has changed since the nineteenth century. Does Labor understand it?

Is inequality the inevitable end point to human history?

We learn that human history is about a path of social evolution from small groups of hunter gatherers, through to more organized agricultural societies and to the modern state in its various forms – differing in institutions and political systems but all of which are highly bureaucratized and all characterized by deep inequality.

That idea is challenged by archaeologist David Wengrow and anthropologist David Graeber (author of Bullshit jobs) in their book The dawn of everything. There is no inevitability in such a path of human development, they argue. As evidence they point to ancient large and stable settlements – “cities” in fact – in which there were no kings, princes or authority figures. Their work receives a broadly supportive review in The Guardian: inequality is not the price of civilisation, and a more hard-nosed review in Foreign Affairs: Deep takes, does a better future lie in the prehistoric past?.