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ch News Politics

Davos 2015: Less Innovation, More Regulation, More Unrest. Run Away! 339

Freshly Exhumed writes: Growing income inequality was one of the top four issues at the 2015 World Economic Forum meeting in Davos, Switzerland, ranking alongside European adoption of quantitative easing and geopolitical concerns. Felix Salmon, senior editor at Fusion, said there was a consensus that global inequality is getting worse, fueling overriding pessimism at the gathering. The result, he said, could be that the next big revolution will be in regulation rather than innovation. With growing inequality and the civil unrest from Ferguson and the Occupy protests fresh in people's mind, the world's super rich are already preparing for the consequences. At a packed session, former hedge fund director Robert Johnson revealed that worried hedge fund managers were already planning their escapes. "I know hedge fund managers all over the world who are buying airstrips and farms in places like New Zealand because they think they need a getaway," he said. Looking at studies like NASA's HANDY and by KPMG, the UK Government Office of Science, and others, Dr Nafeez Ahmed, executive director of the Institute for Policy Research & Development, warns that the convergence of food, water and energy crises could create a "perfect storm" within about fifteen years.
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Davos 2015: Less Innovation, More Regulation, More Unrest. Run Away!

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  • Regulation? (Score:3, Insightful)

    by Anonymous Coward on Tuesday January 27, 2015 @01:35AM (#48911375)

    Now that they've got theirs, it's fine if regulations hold back everyone else.

    • Re:Regulation? (Score:4, Insightful)

      by Jane Q. Public ( 1010737 ) on Tuesday January 27, 2015 @03:14AM (#48911765)

      Now that they've got theirs, it's fine if regulations hold back everyone else.

      I have nothing against people being rich, if they got there honestly and without coercion. Government lobbying, for example, is one form of coercion because it influences regulation of others via money.

      But let's face it: most of them did not get there quite honestly or without resorting to coercion. And in fact, regulations helped to get them there. Not only is that obvious on its face, you can see it in the statistics: the more "statist" and regulatory governments have been, the less well economies have done and the more income inequality we've seen.

      Now they're proposing to try to fix the problem they created, by doing more of what created it. Typical government idiocy.

      And as for "unrest", they aren't going to be able to regulate that away. On the contrary: at least here in the U.S., if they don't start lightening up on Federal regulation, they're going to see far worse problems and more unrest than they have so far.

      • Re: Regulation? (Score:5, Insightful)

        by cyber-vandal ( 148830 ) on Tuesday January 27, 2015 @03:31AM (#48911851) Homepage

        The greatest income inequality in the developed world can be found in probably the least statist country, the US.

        • LOL that's because people with money leave the countries that try to redistribute.

      • Re:Regulation? (Score:5, Insightful)

        by dywolf ( 2673597 ) on Tuesday January 27, 2015 @08:57AM (#48913069)

        How do you possess these completely opposing thoughts at the same time?
        I swear you are a textbook example of doublethink.

        You start off good, then you say things like "the more "statist" and regulatory governments have been, the less well economies have done and the more income inequality we've seen" or " if they don't start lightening up on Federal regulation, they're going to see far worse problems and more unrest than they have so far".

        The sheer idiocy and blindness required to actually believe this things while at the same time acknowledging that inequality is a problem and talk about holding the rich responsible for rigging the system is staggering.

        You are seriously blaming the government and regulation for the inequality we see, and suggesting we do LESS of it?
        You are a moron.

      • Re:Regulation? (Score:5, Insightful)

        by deadweight ( 681827 ) on Tuesday January 27, 2015 @10:04AM (#48913481)
        Is this a standard Fox/Rand template? Every place with more government has more of this problem (easily proved to be not true in 5 minutes), so the obvious solution is to have less government (also easily proved in about 3 minutes). Are you all utterly impervious to reality?
      • Re:Regulation? (Score:5, Insightful)

        by whitroth ( 9367 ) <whitroth@NospAm.5-cent.us> on Tuesday January 27, 2015 @02:14PM (#48916153) Homepage

        This is insightful? I suppose, if you're a libertarian.

        Reality check: in the US, Congress almost *never*, sitting around in the room, decides, "hey, let's make a new regulation, we ain't doin' anything else anyway, and we need to look like we're working." This seems to be what the poster I'm replying to thinks.

        Let's see: St. Ronnie and the Republicans push through banking and s&l "reform", and cut the budget for the regulators. Several years later, the S&L disaster, of which, according to the papers at the time, 30% was internal, white collar crime.
        Deregulate telecoms*, and several years later, the tech bubble bursts, wiping out many retirement investments, and causing a recession.

        Bush & co cut regulation of banking and stocks; and we get the current Lesser Depression.

        Anyone else notice a pattern here? Sort of like less regulation and regulators, and the majority of us get screwed, and loose money, while the top 1% keep going up?

        And I *do* have something against "people being rich". How 'bout we just have a 100% tax on all wealth above $1G? Or maybe above $500M? What', a hundred million dollars isn't enough incentive, people will just fraudulently get themselves on welfare, and sit back and drink light beer and watch tv? Don't bother talking about job creators, either: they've been getting richer and richer... WHERE ARE THE JOBS? (Other than the ones in Pakistan, and China, and India, and ....).

        *And as for "coercion", is that like, oh, in the mid-nineties, when I worked for Ameritech, and we were ORDERED by our division president to write our Congresscritter and Senators to tell them to support deregulation, *and* he wanted copies of our letters (nice job you got dere, be a shame if somet'in' were to happen' to it)?

                          mark

  • what with the rabble's concerns boiling over and impinging on the fringes of their attention.

    • what with the rabble's concerns boiling over and impinging on the fringes of their attention.

      The "rabble" just elected the most Republicans to Congress since 1952. I don't think the rich are too worried.

  • by Maxo-Texas ( 864189 ) on Tuesday January 27, 2015 @02:02AM (#48911491)

    A bunch of rich people with no real military protecting them will be like ripe fruit for the picking (as they have been over and over and over for centuries).

    They would really be much better served by being in a functioning healthy country. Give up 10% of their money to taxes and spread it around the population and they will be immeasurably safer.

    But I think their greed just gets the better of them. As it has over and over and over for centuries.

    • Re: (Score:2, Informative)

      by Anonymous Coward

      Ten percent? TEN PERCENT? Sounds like paradise:

      http://pgpf.org/Chart-Archive/0102_tax-rates

      • by paazin ( 719486 ) on Tuesday January 27, 2015 @02:45AM (#48911669)
        The key here is not a ten percent tax rate but ten percent of wealth.

        I assume the GP was stating this in reference to a suggestion by Thomas Piketty as to what would be a more "just" (in his definition) tax approach to tackle inequality.
        • The key here is not a ten percent tax rate but ten percent of wealth.

          It's surprising how little wealth there actually is in the world. If most of us decided to take a year off and live off the savings, the world would collapse. It depends on us constantly creating new value.

          So if we followed that suggesting, and took 10% of the wealth from everyone in America, including corporations, then spread it around to each person in the US evenly, it would be about $70k per person. Most people would spend it quickly and be back where they started.

          If we took 10% of the global wealt

      • by guises ( 2423402 )
        Wealth tax: 0%. Some states and municipalities in the US have a property tax but that functions in essentially the opposite way, since it hits people the most who have a large amount of property relative to their income (farmers and retirees), making it a regressive tax. There is no federal property tax.

        The closest thing to a redistributive wealth tax is the estate tax, removed all together in 2001 and brought back in a lessor form in 2011. It's primarily politics which keeps us from having a proper weal
        • by Anonymous Coward on Tuesday January 27, 2015 @03:07AM (#48911743)

          Taxing wealth is practically difficult. It's relatively easy to catch money when it's changing hands. Counting the gold in someone's basement, so to speak, is an entirely different matter. Attempting to do is arbitrary - you don't really know the value of something until you sell it - and incentivizes the movement of large amounts of money out of open and transparent markets, which would be disastrous. Whenever you think of trying to tax something, you also need to think about what the broad consequences of avoiding that tax would be, because the motivation to avoid taxes is always high.

    • In other news, shares of Alcoa are through the roof as hedge fund managers shift their portfolio to capitalize on the jump in demand for tinfoil hats....
    • A bunch of rich people with no real military protecting them

      You do realise these are uber rich people.
      They can just hire their own military [wikipedia.org]
      You do realise a good portion of the war in Afghanistan and Iraq were not actually fought by the American military.
      • by khasim ( 1285 )

        The Army alone has about 500,000 soldiers. A lot of them are in support roles but a private military also needs support.

        Where are the families of the people in the private military? Because if they have to go back to the USofA (the "enemy" in this scenario) to visit Mom and Dad then there's going to be a problem. So you'll need room on the uber rich estate for the families of your military. And your support personnel.

        Which brings up the infrastructure to support those families. Schools, hospitals, etc. Wh

    • They would really be much better served by being in a functioning healthy country.

      Do you know much about Switzerland?

    • Doesn't matter. Look at Mexico (and rest of South America). Noticed how the rich live in gated communities with 24h guards? Real power is in wealth disparity, and fuck the entire population and its future to get to the top. It's a parasitic mindset from, well, a parasite. Why have two maids when four can be had for the same price? As for that "price"?? Just a number, and numbers are meaning less if you can jet half-way around the world to purchase your luxuries when in necessary; perceived or otherwise.

    • A bunch of rich people with no real military protecting them will be like ripe fruit for the picking (as they have been over and over and over for centuries).

      Not really no, for example during the French revolution which supposedly directly targeted the wealthy, the majority of those that went to visit Madame were not nobles.

      I'm not entirely sure what the fixation is with income equality anyway, shouldn't people be thinking more about a continually improving standard of living? I mean surely that's what matters most to almost everyone. I know I don't wake up every morning bitterly jealous that someone else is richer them myself, or upset that I can't buy a Lear j

  • Is it the lack of education that keeps the poor taking from each other rather than taking from the rich? I'm sure mine is not the only city that has "Boardwalk" located close enough to "Baltic" that the poor without much effort could take what they want from the rich. Yet still, the poor continue to rob from the poor.

  • On farmland in New Zealand, ready to pounce.

  • And money is easily moved.

    The Occupy movement was almost completely non existent here in Australia. Fergusen style riots don't happen here either. They also don't happen in NZ.

    The USA has some terrible social issues to deal with, with some crazy rich living alongside some crazy poor. While that divide exists you will always have problems. But the US is quite unique in first world countries in that regard. Using the Gini coefficient (https://en.wikipedia.org/wiki/Gini_coefficient) the US is worse than m

    • by swb ( 14022 ) on Tuesday January 27, 2015 @08:22AM (#48912883)

      I think the problem is you can't pack up a whole economy and move it.

      If your wealth is dependent on the US domestic economy and it tanks because of civil unrest, a lot of wealthy people will be unwealthy before they can even reconsider relocating.

      There's also the question of "what is money?" and are you really rich still if you have to convert your money to another currency with a different local buying power, especially if your native currency dives or is sinking when you try to convert it.

      There's also the question of competition for safe overseas havens; if the availability is limited, you're now competing with just the rich, so unless you're elite rich, you may lose out altogether.

      And what kind of haven are you expecting? A self-sustaining kind of pre-20th century British estate of farms and light industry? At the end of the day it sounds like a mash-up of a Ralph Lauren ad with survivalism.

    • by AmiMoJo ( 196126 ) *

      This threat is always made whenever new rules or regulations are talked about, but it's nonsense. People already try to keep their money out of the US to avoid paying any tax on it, and only bring it in when they have something to invest in. Since Silicon Valley is not going to move to another country any time soon, along with all the tech workers that make it what it is, the investment will still happen there. All new rules will do is prevent people hiding as much of their wealth off-shore.

      Japan has strict

  • Inequality's Mossad? (Score:5, Interesting)

    by Bob9113 ( 14996 ) on Tuesday January 27, 2015 @02:29AM (#48911597) Homepage

    With growing inequality and the civil unrest from Ferguson and the Occupy protests fresh in people's mind, the world's super rich are already preparing for the consequences. At a packed session, former hedge fund director Robert Johnson revealed that worried hedge fund managers were already planning their escapes.

    If I recall correctly, Mossad was formed by Israel with one of its primary missions being to go around the world hunting down and assassinating former Nazi officers who had gone into hiding.

    If the world gets to the point where the underprivileged gather their pitchforks and torches, and the ultra-rich flee from mob justice, why wouldn't those who remain take over their nations' governments and form Inequality's Mossad? If the super wealthy really do check out, the people left behind will gain all the authoritarian powers that are being built up right now to suppress change for as long as possible. They'll also get all the resources and production of the biggest powerhouse nations on the planet, because that's where the rich will be fleeing from. And they will be very angry.

    The 99.9% who would still be in their home nations, having just seen the banks get cleaned out, will have the muscle of the G20, the influence of the G20, and the rage of Ferguson. Yeah, super-rich guy, go hide in New Zealand. See how that works out for you.

    • So, in your world all the money in the banks is owned by a few super rich people, and they can just take it with them and go to New Zealand.

      Maybe Huey, Dewey, and Louie will save the day?

  • by Ralph Barbagallo ( 2881145 ) on Tuesday January 27, 2015 @04:57AM (#48912207) Homepage

    A friend of mine got into reading investment books targeted at the extremely wealthy. They were pretty funny. These books had to trump up nearly impossible end of days events and then promote investment strategies that will keep the reader amongst the 1% when half the world's population dies from a space disease delivered by a comet impact or some other highly unlikely scenario. Elite Panic is big business.

    Maybe the new path to the middle class will be in selling doomsday bunkers to paranoid trillionaires.

    • Maybe the new path to the middle class will be in selling doomsday bunkers to paranoid trillionaires.

      Too late, this business picked up in a big way not long after the Great Recession hit. Wired had an interesting article and photo gallery on "luxury doomsday shelters" but I can't find it now.

  • Regulation IS the problem. Had we done the principled thing and let AIG and Goldman burn when the time came it would have taken lots of big finance with it. There would have been plenty of churn as far as just who the 1% are. I would even guess some of them would have been left with less than nothing.

    Oh but they would still have all kinds of physical property and hard assets. Yes but assets sometimes have a funny way of turning into liabilities when you don't have the case flow to manage them properly.

    • by Svartalf ( 2997 )

      Ah, but the thing is...they're trying to protect THEIR inequality instead of being eaten by the stacked deck turning on them.

  • Not one single leader will step up and address the real problem. The upper crust gang feels threatened that society will collapse and yet we still hear nothing about causes or solutions. The fact is simple. Almost all of our woes are due to excessive population. If we firmly address the reproduction issue we will knock down pollution, sprawl, unemployment and a host of other issues. The next item is to address greed and stop allowing greed to drive bussinesses. For example we have fo
  • We could have both perhaps. But in general, this is sad, since with a few trillion invested in R&D, we could have fusion energy (or dirt cheap solar, coming anyway, but more slowly) and automated indoor agriculture and near 100% emissions-free recycling of all consumer goods, and so on. And many actions of the wealthy (especially those invested in oil) have essentially blocked these sorts of efforts politically. As Bucky Fuller says, whether it will be utopia or oblivion will be a touch-and-go relay rac

  • Davos is a gathering of the ultra-rich and the ultra-powerful. When they talk about "fixing the planet", what they mean is policies that keep them in power and keep them wealthy.

    Attending Davos is pretty much a sure sign that a politician, activist, or "philanthropist" can be trusted.

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