Today's date:
Winter 2008

America No Longer Owns Globalization

Spring 2007

This year's theme at the World Economic Forum annual meeting—"the shifting power equation"—confirmed the view of the global elite gathered in Davos, Switzerland, that power is draining away from the United States to multiple centers as countries from Brazil to China move beyond "emerging" market status to establish themselves as major players on the world scene.

The conference theme also acknowledged the panic in traditional business circles as power shifts from the producer to the consumer thanks to the Internet and the digital distribution revolution.

Far from some kind of conspiracy of the global elite plotting the future as they whisk down the Alpine slopes, Davos is in fact a backend barometer of their evolving worldview. It does not break new ground but consolidates opinion. It does not generate new trends but codifies them into conventional wisdom. That is its power and its importance.

Usually, Davos gets it right because its motto, which might be described as "follow the money, with the conscience trailing behind," pretty much approximates how the world works.

Over the nearly 20 years I have attended the Davos conclave as a member of the media leaders club, I have witnessed many times how it offers a snapshot of world power relations at a given moment.

After Nelson Mandela was released from prison, but before he was president, for example, there he was on stage with F.W. de Klerk, foreshadowing the peaceful transfer of power after apartheid. (In those days, before the Davos forum grew from a meeting of minds into an unwieldy convention, you could bump into almost anyone and have a chat. On one such occasion, the editor of the Dutch newspaper NRC Handelsblad and I shared a buffet dinner with Mandela, who, unprompted, launched into an impassioned defense of his then-wife Winnie Mandela for all the burdens she carried during his years in prison.)

Mikhail Gorbachev never came to Davos. First, he was too busy with perestroika at home; then, after the failed but politically fatal coup, he was considered a has-been not worth inviting. But no sooner did Boris Yeltsin come to power than the place was swarming with Russian business oligarchs replete with their contingents of prostitutes in hotel lobbies. Famously, these primitive capitalists connived in Davos to ensure Yeltsin's second term.

Probably that same year, the rambunctious, newly elected Polish president, Aleksandr Kwasniewski, plied me with endless shots of Chopin vodka, all the while insisting that, for his kids at least, "MTV was more important than NATO."

There was the moment at the very end of the Clinton Administration when Israeli and Palestinian negotiators thought they had clutched a deal at Taba and it was left to Shimon Peres and Yasser Arafat to tie up the details in Davos. Presaging the disaster to come, Arafat gave a startling speech right out of the 1960s, reading off a paper as his hands shook uncontrollably, condemning "the Zionist enemy." Peres was left in the lurch only to comment, "I thought I was coming to a wedding and instead got a divorce."

My wife and I cringed as we witnessed a conversation in 2004 at a reception between Mohamed El Baradei, head of the International Atomic Energy Agency, and Vice President Dick Cheney. The Americans and Brits had just cut a deal with Khaddafi to give up his nukes. In a beseeching manner, El Baradei asked Cheney when he could get briefed to verify Libya's disarmament. In his unilateral way, Cheney all but dismissed this request by the world's top nuclear cop with a response like "when the time comes" and moved on to avoid further conversation. Later at a lunch with Cheney, I got only a blank stare when I deigned to ask how it was in the US interest to empower a Shiite majority in Iraq aligned with Iran.

That same year, Khaddafi's son and heir apparent said in an interview that he accepted the "historical reality" of the Holocaust, because, "after all, the Soviets had liberated those camps and we could trust their word." He also opined that democracy was needed in the Arab world because the lack of it made Arab armies inferior to Israeli. "In Israel," he said, "a general is held accountable by an elected prime minister if he fails. So they get the best generals. In the Arab world, the top general is chosen because he is the least likely person to plot a coup against the leader."

When the moderates in Iran were on their last legs before Mahmoud Ahmadinejad took over, a dinner with the Iranian foreign minister Kamal Kharrazi at the Belvedere Hotel fell into awkward disarray when he didn't show up. It turned out wine was being served, a breach of radical Islamic etiquette. Even so, over the years, Sen. Joe Biden or Bill Richardson, when he was United Nations ambassador, would from time to time "bump" into Iranian leaders walking along or sitting in the cafes along Davos' main street and manage a conversation.

This year's theme of a power shift completed a cycle that began in 2000 at the high moment of American triumphalism, before the bust and 9/11. For the first time in its history, an American president, Bill Clinton, addressed the WEF, descending on Davos, helicopters aroar and loudly echoing across the pristine valley, with practically the entire American Cabinet in tow. I wrote then that, "Paradoxically, Clinton's presence codified the triumph of the American challenge the WEF was founded to resist." It was paradoxical because this annual gathering two hours up the mountain from Zurich had first been organized decades earlier under the name "European Management Seminar" as a way for Europe's business leaders to come together and figure out how to respond to what French author Jean-Jacques Servan-Schreiber had called "the American challenge."

I wrote then, not wrongly but now far less true, that "clearly, globalization is an American-led phenomenon. Those gathered in Davos were in awe of a US economy in the midst of its longest expansion in history with full employment and low inflation thanks in good part to freer trade and advances in information technology.

"Industrial titans from Europe and Asia sat gaping as Microsoft's Bill Gates, AOL's Steve Case and Viacom's Sumner Redstone offered their version of how to make billions in the new economy. Sessions on the other great revolution underway in genetics were also dominated by Americans, from the scientists to the regulators.

"From so high up in the Alps, you can see clearly all the way to the future. And the future, if this year's Davos meeting was any indication, will be undeniably American."

In the intervening years, Bush's unilateralism, the war in Iraq, the torture at Abu Ghraib, the warrantless wiretaps, the revelation of racism and inequality after Katrina and the aggressive religious right have all tarnished America's luster.

Yes, today America retains it technological lead. Gates, Google's Eric Schmidt and other American technologists still dominate the Davos chatter. Hollywood also had its 15 minutes of fame at the forum, culminating, in fact, ending, with Sharon Stone's very un-Swiss eruption at one of the plenary sessions two years ago, which embarrassed the rich audience into coughing up on-the-spot donations for malaria nets that year when Africa was so in vogue.

But globalization, as this year's Davos agenda suggested, is no longer an American-led phenomenon. Globalization now belongs to everyone who can figure out how to take advantage of its opportunities and minimize its dislocations. American-bred technology may be its midwife, but Americans are no longer solely the parents.

That's a big power shift indeed. Thanks to Davos, it will be the new conventional wisdom.