The Firebreak’s Daily Davos Dump: Day 2
The Donald Effect 2.0 is met with mediocrity
Day 2 in Davos had intended to focus on sustainability, carbon footprints and climate action. But participants woke up to the news that Donald Trump had signed executive orders to leave the Paris Climate Agreement (again), leave the WHO (again) and slap tariffs on countries seen to be America’s closest allies. This created an opportunity for business leaders (including some who had pulled out of the UN’s Net Zero Banking Alliance just a few weeks ago) to feign outrage and philanthropists to step forward with plans to fill the gap. As we saw from the Firebreak’s coverage of Day 1, the World Economic Forum wants to identify itself as a free market UN partner, so there is no doubt that the final report will show some (totally spontaneous) Davos Declaration committing to the fight against climate change.
Of course, what would a Davos event be like if Greenpeace did not fly in (I suspect in Business Class) to protest how the rich and powerful … fly in … to the Swiss ski resort? This year, six campaigners made the pilgrimage and one apparently brought a child (or is that Greta Thunberg standing on the vehicle?). I suppose they couldn’t get to the heliport so they found some transport vans to protest under (since nothing smells like opulence as much as airport shuttles).
The Donald Effect 2.0
Donald Trump will not be speaking until Thursday, maybe, but his presence has loomed large over Davos during the first two days. No Bloomberg or CNBC interview of distinguished WEFeries would be complete without giving the luminaries the chance to express some degree of diplomatic outrage and carefully parsed concern. Speechwriters are definitely earning their keep this week.
European leaders are using the new American administration’s isolationist shift to talk tough about how they have an opportunity to unite and take responsibility for themselves (implying that for the last 80 years, Europe has relied on Uncle Sam for everything). Volodymyr Zelenskyy spoke proudly about how Ukraine has stepped up, developing its own arms industry with a significant weapons production capability and advanced drone technologies heretofore unseen. So on a day when the WEF wanted to promote inclusion, social equity and opportunities for marginalized communities, the Ukrainian president came to town begging for investments from the arms industry and weapons manufacturers. ESG is truly dead but I doubt Volodymyr’s impassioned requests will make it into the final Davos report.
As the German chancellor, Olaf Scholz (the only G7 leader to commit to coming to Davos in person) was not yet in town, all eyes at the Forum were on the European Commission president, Ursula von der Leyen, to provide Europe with a strong contrast to the threats and uncertainty being created in Washington. Would she deliver the speech of her life, standing up boldly for “European values” and draw the line between good and evil which would heroically set the tone for the next four years of transatlantic relations?
As a weak leader who had hidden in the shadows for her first term, Ursula apparently did not change her speech, dare to challenge the American president or even register a memorable headline. A leaderless Europe is going to sadly deserve what is soon coming at them.
Wait, sorry. I just found out that the German leader, Olaf Scholz, did, in fact, speak to the WEF conference on Tuesday. Since he was not going to take a risk and stand out with strong statements, I assume no one noticed my earlier mistake or that he actually attended on Day 2. His speech was so dry that Reuters chose to interrupt the reporting to quote the German ambassador to the United States who has been warning of turbulent relations with Trump.
Time for a Global Leadership Pivot
It is no secret that the architects of the World Economic Forum see themselves as global leaders, with ambitions of their small secretariat working as a central link between the UN organizations, world leaders and the business community. But this leadership desire has been built on a left-wing, green dogma at a time when populations have been rejecting this ideology, with far-right populist political parties in the ascendency. There is a leadership vacuum in most Western capitals, while corporate leaders excel more in followship than leadership and a UN system that is incapable of concluding a coherent conference declaration. The WEF surely needs a better ally to help them step up and lead the world.
So the WEF is moving closer to home, pinning its hopes for global relevance on billionaire philanthropists, bringing together 140 foundations and trusts under what they call the GAEA Initiative (Giving to Amplify Earth Action). Created in 2024, the WEF are claiming to have $200 billion of capital and financing for “climate and nature solutions around the world” to “bridge the green finance gap”.
I have referred to this as foundation capitalism – the unleashing of funds to get the best return on investment – so who better to lead the charge than the high-end global investment community meeting every year in Davos. The philanthropists come to the World Economic Forum, engage with global leaders, write a check and be seen to provide solutions other leaders have seemingly abandoned. The WEF can then use their interventions to portray themselves as the true institution of global leadership.
On a day when Donald Trump abandoned global conventions from the Paris Climate Accord to the OECD minimum corporate tax to the World Health Organization, the World Economic Forum, via its GAEA Initiative, can be seen to be the one true global leader to step up and fill the vacuum America has left behind.
Klaus Schwab, no doubt, truly believes he should be awarded a Nobel Prize.