Make No Mistake, Davos, the Fat Cat Backlash Is Coming
The recent travails of some of the best-known “Davos Men” are telling. Voters are increasingly unwilling to accept the excesses of executive pay.
As Davos talks about better governance, the rest of the world talks about 70 percent tax rates.
Photographer: Stefan Wermuth/Bloomberg
Ten years ago, the Davos conference asked the question: “What must industry do to prevent a broad social backlash?” The answer probably wasn’t “Double, triple, or sextuple the wealth of the most prominent conference attendees, while letting median household incomes stagnate back home.” Yet that’s what happened. Make no mistake: The backlash is coming.
There has always been a whiff of hypocrisy at Davos, where elites expand their carbon footprint, eat $43 hot dogs and throw lavish parties in the name of making the world a better place. “Fat cats in the snow,” the regular attendee Bono once called it (and he should know). But given the rapid advances of populist politics, it’s remarkable that in 2019, those felines are looking better-fed than ever. The past decade and a half has seen U.S. corporate profits outgrow employee compensation at an unprecedented pace, according to the St. Louis Fed. A Bloomberg News analysis of the fortunes of a dozen Davos attendees found that they soared by a combined $175 billion since 2009. Those feel-good panel debates on topics like “Better Capitalism” are pretty laughable.