Klaus Schwab heads the World Economic Forum; He founded the organization in 1971. The World Economic Forum holds a massive conference every year in Davos, Switzerland, in which thousands of world leaders, diplomats and experts gather to trade ideas on a variety of topics, including how to run the world cooperatively.
Lest this characterization be seen as an exaggeration of the matter, Schwab himself, opening the convention this year, said: “The future is not just happening. The future is built by us, a powerful community, as you are here in this room. We have the means to improve the state of the world. But two conditions are necessary. The first is that we all act as stakeholders of larger communities, that we not only serve self-interest but serve the community. This is what we call stakeholder responsibility. And second, that we cooperate.”
It is a call to action for elites around the world. They appoint themselves as representatives of global interests – without election, without accountability – and then build mechanisms of national and international order to govern the citizens they claim to preside.
Schwab himself has decoded his favorite term, “stakeholder capitalism”. “Free markets, trade and competition create so much wealth that they could theoretically outperform everyone if there is a will to do so,” he wrote in Time magazine in October 2020.
To do so, however, would require taking cues from Greta Thunberg, #MeToo and Black Lives Matter; This would require “creating … a virtuous economic system” in which companies abandon their core mission of serving customers and shareholders and instead answer questions like “What is the gender pay gap at Company X?” How many people from diverse backgrounds were hired and promoted? What progress has the company made toward reducing its greenhouse-gas emissions?”
All this extraordinary ego is based on a distorted view of how successful transformation works within decentralized systems. As Schwab himself acknowledged, free markets have produced more prosperity than any system in human history. But that’s because there are free markets No A top-down imposition, a system created by the conspirators somewhere in the back room.
Free markets were the result of centuries of evolutionary social progress: the gradual recognition that private ownership was the greatest incentive for work and innovation; incremental understanding that individual rights are the only alternative to endless struggle; Step-by-step acceptance that decentralized sources of knowledge are both broader and deeper than centralized sources. The most powerful and sustainable institutions we have are traditional because, as F.A. Hayek wrote, they are “a product of cumulative development without being designed by a single mind.”
For Schwab and people like him, however, this is an evolutionary view that must be put to an end. Instead, he and his rationalist friends—talented businessmen and ambitious politicians, hardworking bureaucrats and short-sighted experts—will cure the world’s ills as long as we give them the power. Or, more likely, until they seize power in the name of “stakeholders” to whom they are never accountable.
One of the great ironies of the past several years is the gap between the elite’s perception of themselves. For the elite, their solutions failed because the citizens of the world lacked the will to listen to them; For the citizens, the elite failed because their prescriptions were wrong. Yet as long as the elite retain their power, they will continue to pursue their utopian dreams at the expense of the people they intend to serve.
The Daily Signal publishes various perspectives. Nothing written here is not meant to represent the views of The Heritage Foundation.
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