Why the global business elite feel no remorse about the damage they've done.
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Back for seconds: Offstage, the mood has changed remarkably little in Davos this year.
Everything has to change in order for everything to stay the same," wrote
the Italian author Giuseppe Tomasi di Lampedusa in his famous novel The Leopard. The novel is set in 19th-century
Sicily, but Lampedusa
could just as easily have been describing the 2009 World Economic Forum in
Davos.
You notice it more in the corridors and the cafes of this exclusive
Swiss hamlet rather than in onstage debates. Publicly, the discourse is all
about the dangers of "false market assumptions" and the now-infamous "financial
engineering." (I seem to remember it being called "financial innovation" last
year.) But offstage, top bankers, private equity bosses, and hedge fund stars
keep chitchatting and socializing, just as if banks had not had $1 trillion
write-downs, the financial markets had not lost $25 trillion, and up to 30
million jobs were not at risk around the world.
To achieve this state of mind, any human being probably needs to
construct a formidable mental shield. A survey I personally conducted at Davos
this year of 60 top central bankers, financial market regulators, fund managers,
and industry opinion-makers gives an idea of what this shield looks like.
When participants were asked whether they think they have done something
in their career which "might have contributed, even in a minor way, to the
financial crisis," 63.5 percent opted for a clear "no"; 31.5 percent went for a
"yes," often adding in the same breath that nobody in the industry can honestly
claim otherwise; and 5 percent said "maybe."
The "yes" people were then asked to explain what triggered their wrong
decisions. They had three options: "too much optimism" (68.7 percent), "I felt
I had to keep dancing while the music was playing" (31.3 percent), or "greed"
(0 percent).
David Rubenstein, cofounder and managing director of the Carlyle Group,
expressed surprise at the results. "How strange," he said. "I thought 100
percent of them would say they had nothing to do with it."
For all his wry humor, Rubenstein has a point. Psychological self-defense,
a Darwinian instinct, is part of human nature, and "Davos Man" is no exception.
Feelings of personal responsibility after a collective catastrophe are a matter
for psychologists rather than World Economic Forum conversations, but the
answers to the survey should come as no surprise.
For all the talk of the more "somber" mood at this year's event, there
were about 100 more private jet movements
at the Zurich
airport last week than during last year's event. I'm not sure if the irony was lost on the
organizers who handed out pedometers to forum participants, to encourage them
to walk and reduce their carbon footprint.
The conflicting attitudes of contrition and denial were evident at a
special event on the "36 hours in September," when Lehman Brothers collapsed
and the world changed. Nassim Nicholas Taleb, author of the bestselling The Black Swan, a book about
hard-to-predict events, gave a presentation. The participants enjoyed his talk, which
was brilliant and provocative as usual, but as he spoke, one couldn't help wondering
if what they were actually enjoying was the simplistic comfort that Taleb's
message could provide.
The audience seemed to enjoy the idea that the current crisis is a "Black
Swan," a very unlikely, though possible, event. The alternative view is that of
a train driven full speed into a wall. Thinking that way requires one to ask
who was in the driver's seat, and just maybe recognizing one's own fingerprints
on the wheel.