Taking responsibility

The stage is set for the movers and shakers of the world to rub shoulders at the World Economic Forum's Annual Meeting in Davos.

Reflections on the past and actions for the future will all meet under the aegis of one great thought: "taking responsibility for tough choices". Responsibility is a tough word to deal with. When I say this I think of Mikhail Khodorkovsky whose eyes staring out of the prison remain a haunting picture for the world of business, I think of a friend who was harrassed at US airport in the name of security and I also think of my friends living in India and doing business. They often tell me that they keep some amount of their profits aside to put in the pockets of corrupt officials.

These are examples from the developed and the developing world. Are we creating more barriers for growth? Are we forced to live with fear? Who takes responsibility?

Comments

[Douglass Carmichael]

You will see, if you click through the run-up to this year's Davos, that the tone is high and the realism seems robust. The problem, as I see it, is that the market rationalization forced by competition means more poor at the margins, and more concentration of wealth (in scarce protected positions, through regulation). The consumer is too pushed by cost cutting to have any income, and the few who are rich want other products, such as ranches and golf courses, which drive prices higher. The mechanization of the economy (I mean is mathematical modeling - see the wonderful book Machine Dreams: how economics became a cyborg science by Mirowski) is the real driver, and interest in the poor, the environment, education, health, and broad political participation give way at every point to market logic, and the need for security systems to deal with the new malcontents. Joseph Tainter's book, The Collapse of Complex Societies, says that societies, as they expand, spend an increasing percentage on infrastructure, such as transportation, jails, wars, and environmental remediation, until they go broke and collapse. The elites own the businesses that do the infrastructure and will hold on to their centrality in the economy, and their diminishing benefits, until they collapse. Jarad Diamond's new book Collapse, lays out the logic of bad decisions and failure to notice what is going on. My guess is the tough financial advisers tell their clients, "It is falling apart, get what you can NOW so you can enclave yourselves." Those who remain optimistic for the most part are those who run currently benefiting businesses. The others who are optimistic still have faith in human nature, education, art, science, and human compassion. The real question is, is there any real model besides that of market rationalization, with its winners and losers?