What We Saw at the Gabfest
This year's World Economic Forum--also known as "Davos on the Hudson," because it took place in New York City rather than Davos, Switzerland--was a study in contradictions. The parties were more lavish than usual, because New York has world-class restaurants and Davos, well, doesn't. Yet the talk was more negative than in the past, revolving around three themes: the cost of globalization, the power of big corporations on the world scene, and the shortcomings of the U.S. economic model. In short, Davos this year was very much in tune with themes BusinessWeek has been analyzing for some time. If you logged on to one of the futuristic laptops in the Waldorf Astoria lobby, you might have thought you were getting a BusinessWeek agenda.
Indeed, Senior Writer Pete Engardio's prize-winning Cover Story, "Global Capitalism" (Nov. 6, 2000), was the first article to pop up when WEF attendees went to their Web sites or turned on one of the hundreds of $500 iPAQ handheld devices given out free. Pete's Special Report anticipated many of the pragmatic discussions at the global economy workshops this year.
The growing unease with Corporate America and big global corporations in general, on view at many WEF panels this past week, was also anticipated by BusinessWeek. Our cover "Too Much Corporate Power?" (Sept. 11, 2000) had one of the first popular polls taken in America focusing on public attitudes toward Big Business. What did it show? An increasing wariness over the power of large corporations and their influence on government and society. A more recent BusinessWeek poll, "A Growing Sense of Anger" (Feb. 4, 2002), reaffirmed the trend. To Europeans who believe that most Americans are blissfully happy with the structure of the economy and the role of corporations, BusinessWeek offered a different perspective. Written by Senior Writer Aaron Bernstein, the cover provided insight and analysis to what may be one of the most important trends of our time.
The fallout from Enron Corp., the collapse of the Nasdaq bubble, and the anxiety and pessimism expressed at the WEF conference itself by U.S. CEOs came together to throw doubt on the American economic model. BusinessWeek was ahead of the crowd again, and readers benefited from its insights. In the Cover Stories "Hype on Wall Street" (Apr. 3, 2000) and the recent "Accounting in Crisis" (Jan. 28, 2002), BusinessWeek laid bare the problems with pro forma accounting and the drive for higher earnings that took many companies into unacceptable gray areas. The stock market is reevaluating them harshly.
There was also some schadenfreude from our European friends, who doubted the achievements of the '90s economy and now feel vindicated by the quaking of Corporate America. Short term, they're right: The financial markets are ruthlessly slaying the devious and infirm. Yet even as this surge continues, it's hard not to notice that U.S. productivity is still growing nearly twice as fast as it did in the '70s and '80s. In "What Recession?" (Feb. 11, 2002), there's also convincing evidence that the productivity upswing is setting the stage for a new round of healthy growth.
As a gabfest for the elite, Davos lived up to its glitzy reputation. But the underlying tone was somber and serious. BusinessWeek readers might not have been too surprised. Keeping you ahead of events is what we do for a living.
By Bob Dowling, Managing Editor--International