In late January, the world’s political elite will meet privately for off-the-record discussions with high-ranking representatives of the world’s leading corporations, at the World Economic Forum (“Forum”)’s Annual Meeting in Davos, Switzerland. These corporations (called Partners by the Forum), pay the expenses for the event, set the Meeting’s agenda, vet its proceedings and generally control the program at Davos. And many of the most powerful of these Partner corporations have criminal records, operate under deferred prosecution agreements related to prior criminal activities, or have other dubious characteristics.
U.S. citizens have lost faith in their political leaders — only nine percent of Americans approve of Congress’ performance. A corporate boondoggle at a Swiss ski resort with leaders of third world dictatorships and criminal entities won’t improve these approval ratings. U.S. politicians should skip Davos, and avoid four days of being spoon fed whatever propaganda the Forum’s Partners want them to hear.
The Forum’s Partners pay $500,000/year and more for privileged access at Davos to political leaders (who attend for free), and the ability to set the agenda for what these political leaders will discuss. To quote the Forum Partners:
“set the intellectual agenda of Forum meetings, driving the insight agenda of its publications and steering the impact of its initiatives…” — Forum“
Unfortunately, many of these Partners have criminal records, are under investigation for potential criminal activity (e.g., bribery), are mired in significant legal/ethical issues, or have blatant conflicts of interest while setting the agenda for a supposedly “non-partisan” event. If this sounds like exaggeration, consider a few of the Forum’s Partners:
- J.P. Morgan, which is under criminal investigation for possible bribery in China, operates under a deferred prosecution agreement relating to two felony violations in the Madoff scandal, and much else. Recent fines and settlements paid, so far, for various criminal and civil violations exceed $40 billion.
- HSBC, which admitted to criminal activities, paid $1.9 billion in fines, and currently operates under a deferred prosecution agreement.
- Standard Chartered, which admitted to willful acts of criminal money laundering, operates under a deferred prosecution agreement and paid a $660 million fine.
- UBS, which has had numerous serious legal violations and paid over $2 billion in fines to settle civil and criminal charges, has acknowledged its participation in fraudulent schemes (e.g., interest rate rigging, tax evasion), and operates under 2 deferred prosecution agreements.
- Johnson & Johnson, which paid $2.2 billion to settle criminal and civil charges related to fraudulent practices in the sale of its pharmaceuticals.
- Saudi Aramco, controlled by the Kingdom of Saudi Arabia – a country that doesn’t allow women to drive, uses public flogging as a form of judicial punishment, and ranks 163rd (bottom 10 percent) in the world for press freedom.
And many other entities often involved in dubious practices. You can find a complete list of the Forum’s Partners here.
The Forum’s stated mission is “improving the state of the world”. If it’s serious about that mission, a first step would be requiring (as a condition of Forum membership) that Partners obey the law and internationally recognized standards of human rights.
The Forum’s Partners aren’t charitable institutions. They expect value for their money — and the Forum delivers. In 2013, the Forum’s Partners gained special access to, and set the agenda for, some 1000 public sector leaders attending Davos, including the following members of the U.S. Congress: Eric Cantor (R-Virginia), Mario Diaz-Balart (R-Florida), Jeff Forenberry (R-Nebraska), Kay Granger (R-Texas), Darrell Issa (R-CA), Patrick McHenry (R-NC), as well other political leaders such as Jon Leibowitz – Chairman of the Federal Trade Commission (a political appointee), Governor Kasich (R- Ohio), and several hundred other prominent political leaders.
Because the Forum’s Partners set the agenda, the concerns of average citizens aren’t being heard. It’s unlikely J.P. Morgan, HSBC or others are demanding a Davos discussion session concerning why the U.S. Department of Justice failed to prosecute any CEOs at “Too Big to Jail” financial institutions. Or a session suggesting a government role in reducing America’s increasing income inequality. Instead, these banks sponsor meetings presenting their views about how they’re terribly over-regulated and persecuted by government authorities.
It’s intimidating — and sends a terrible message — to civil servants investigating or supervising corporations (e.g., under their deferred prosecution agreements) that these miscreants’ CEOs have privileged, and private, access to the political bosses of these civil servants.
U.S. politicians shouldn’t attend Davos. Unless, of course, the real purpose of Davos is to provide politicians with opportunities for off-the-record meetings with questionable characters.
This piece is cross-posted from The Huffington Post with permission.
Steven Strauss is an adjunct lecturer in public policy at Harvard’s Kennedy School of Government. Immediately prior to Harvard, he was founding Managing Director of the Center for Economic Transformation at the New York City Economic Development Corporation. Steven was one of the NYC leads for Applied Sciences NYC (Mayor Bloomberg’s plan to build several new engineering and innovation centers in NYC), NYC BigApps and many other initiatives to foster job growth, innovation and entrepreneurship. In 2010, Steven was selected as a member of the Silicon Alley 100 in NYC. He has a Ph.D. in Management from Yale University, and over 20 years’ private sector work experience. Geographically, Steven has worked in the U.S., Asia, Europe and the Middle East. – See more at: http://www.economonitor.com/blog/2013/12/welcome-to-the-sharing-economy-also-known-as-the-collapse-of-the-american-dream/#sthash.wWtFdF98.dpuf
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