Davos Notes: Contrite Bankers, Overflow Interest in Philanthropy, Mistrusted Americans

On this, my first day in Davos, I hit the ground running -- literally speeding from the airport in Zurich to my first panel at the World Economic Forum, an "update on North America." Although the session was supposed to center on how the Obama administration will turn its campaign rhetoric into policy, the conversation quickly turned to a rather gloomy overview of all the crises facing the world (Nelson Schwartz of the New York Times' DealBook blog dubbed it "A Tour of the World: Who's Got It Worse?")

Memorable moment: After the panel discussion, moderator Josef Joffe, the publisher-editor of Die Zeit, opened the floor to questions. The first questioner, perhaps responding to my earlier assertion that Wall Street execs and bankers are acting like Marie Antoinettes, rose to his feet and, dripping with contrition, introduced himself by saying, "I am one of these financial guys..." It had the feel of a down-and-out binge drinker who, after finally hitting bottom, shows up at an AA meeting and announces "...and I am an alcoholic."

That is the mood everywhere you go: "these financial guys" walking around, looking a little lost. (Of course, looking lost in Davos is de rigueur. Everyone working at the conference -- especially policemen and drivers -- seems to have been shipped in from someplace else. Maybe another planet. As a result, no one knows where anything is. And they are proud of it.)

After the morning panel, I hurried over to a quaint little Swiss bistro where a lunch discussion was being held about "PhilanthroCapitalism in Action." Maybe it's a sign of the times, but there was an overflow crowd at the luncheon, causing the organizers to open two additional rooms to hold the extra attendees. Matthew Bishop, Chief Business Writer for the Economist, and Nancy Lublin, CEO of DoSomething.org, had to go from room to room to discuss how this moment of crisis for capitalism and for philanthropy could be used to transform both -- how capitalism could be imbued with a social mission and philanthropy with the best practices of capitalism. (Indeed, DoSomething, right around the time Lehman Brothers collapsed, did an IPO that raised money to run a non-profit with real metrics and accountability.)

Next up, an afternoon session featuring a conversation with Chinese premier Wen Jiabao. The conversation was off-the-record, but let me just say that the amount of time it took to translate everything he said made me wish I had either studied Chinese at school or gotten more sleep on the plane. It's worth noting that 20 minutes after the session, I wasn't hungry for more time with Wen.

Jeff Jarvis, who was sitting a row behind me, captured one of the prevalent sentiments here: "taking America to the woodshed." In a panel on the falling trust in financial, government, and journalistic institutions, Richard Edelman of the Edelman Trust Barometer, reported that his group had seen a steep drop in trust for American business. The least trusted U.S. industries are automakers and bankers. Imagine that.

So far, the two questions that keep coming up in almost every speech, panel, and hallway conversation are "what went wrong?" and "how did we miss the signals?" The consensus conclusions: 1) Too much faith in the free market. 2) Too much faith in economic models. 3) Too little transparency. 4) No moral compass.

Read More Davos Notes:

Blackstone's Schwarzman "Walking with His Head Still On"

Davos '09: Less Glitz, More Anxiety

Be sure to keep checking our Davos Big News page for the latest news, commentary, and video coming out of the World Economic Forum.

Comments

[Geria]

Besides too much faith in the free market, you might add a malevolent desire to destroy the existing economy and replace it with something that wouldn't work. This is the second time in l00 years that these capitalists have come at the economy and the government with hatchets and with the same result, chaos and economic depression. Belief in the market as some kind of organizing principle is nonsense; it doesn't correct itself and it is not the purest form of democracy. Market populists have spewed hatred upon democrats and all liberals, equating them with communists. This unfounded hatred still poisons Congress and the electorate. I'd like to see Obama's stimulus package include building enough maximum security institutions to hold all of them. It is frightening to know that Grover Norquist is still at large, still destroying what took better people generations to build.

[Geria]

The comparison of Wall Streeters to binge drinkers is right on the nose. Their hunger for profit has no limits at all; all the money in the world isn't enough for them! In a rare candid moment, like you experienced, they will admit this.

[funkalicious]

2,4,3, =1 no trust.. especially when the tax man won't pay his taxes, we will not see Trust return to the system. Perhaps Trust and following the law is too much to expect from President Obama's Administration .

The last administration was a disaster and being accepting of tax evaders at the top of this administration is a disconcerting trend, of no real Change and continued distrust.

I think I will have a tax holiday and help pay my eight year old nieces cancer treatment instead no F*ing mistake or apology.

[desertmonkey]

dear ms huffington:
i think the #4 reason you listed for what went wrong as the lack of a moral compass should be moved up to the #1 reason. this is what's wrong with america. i'm hoping that this administration will help us reinstill this quality in our lives again.

[thevillagewitch]

Hmmmm, I think it's high time for Huffington to clue in to the fact that China is posed to be the New World Leader. Dismissing Wen Jiabao is sure to be a regret.

Here's a good place to start in order to "decentralize" the illusion that the U.S. will be any part of the World Elite unless they redefine their relationships to the rest of the world.

"US's road to recovery runs through Beijing"
By Francesco Sisci and David P Goldman

http://www.atimes.com/atimes/China/JK15Ad01.html

[magibrotherhood]

while I agree that there are a few well-meaning people at this conferance, it mostly feels like it`s a B.S.-Fest.­---------w­ho`s B.S.ing who here--????????

[Geria]

I haven't seen anything so far that looks like a sincere effort to replace this failed system with another, preferably a New Bretton Woods system of the type FDR wanted to create.

[magibrotherhood]

cheap-lothario smelling-----yeah , alots smells about this -------

[tommytoons]

We who are able to read and understand what is going on in the world today could , I would venture to guess, all could agree that one of the major causes to the economic plight, is human greed and an inability of others, to understand that by acting to capitolize the accumulation of as much money as possible, is hurting others and setting up a world picture as we currently have.

People who get degrees in Business should be required to attend classes that teach ethics and moral respondsibilty. I know this may not stop people from being greedy, but it might be a start to teach others how fragile the human heart is and might cause the business community, to consider the heart just as valuable as a dollar.

It might also, be a requirement for all college students to be involved in working for a semester on a community program to see how the poor must cope in a money charged world,and foster a caring, thoughtful attitude before they get into a boardroom and make decisions that would affect those they had tried to help, while in college.

[koolwoman]

Tommytunes, You are so right. They need to walk in the shoes of the poor before they can graduate. Maybe they would be less arrogant and snobbish . I lived through the last depression. I have seen it all., and now I know that I can survive.

[magibrotherhood]

the SNOB-BUBBLE allows one to be insulated from reality--------sad really.

[citizenX07107]

Great article, next best thing to being there, or having full CSPAN coverage. In the late 90's, I thought I'd lose my mind, till I started 'connecting' or following, when I had time, Arianna Huffington, as I can't expect she's time to read all these comments. I do, being a casualty of the Bush and previous republican administrations, (Laugh, a little?) ...

I would have lost my mind during the Clinton witch hunt years if not for listening to Arianna, because as I tell my European friends, it was almost impossible for an intelligent person to not get fully physically sick, watching the degradation of the country over 20 years, horribly, bad for me, as well.

She noticed completely and articulately fuoght as I would have liked to fight, as a journalist, as a person of the world, she spoke the things I had no way to express myself

I am so glad I could have a place like the Huff Post that eventually came out of Arianna .... alll good things come frome Greece, seems to me ..... thanks for the arenas that kept my sanity - if you could call what remains of my mind, that. Ciao, adios, yassoo

[RonMar]

"Earlier today, the world’s top economic advisors gathered at a luxury ski resort in Switzerland to find a solution to the global financial crisis. So far the best idea is to stop traveling to luxury ski resorts in Switzerland." - Conan Obrien, Jan. 28, 2009

A bit more amusing and a lot truer than Arianna's article.

[barnybilt]

I wish people would quit calling them banks. Banks are depositor funded and make their money loaning out the depositors money to others to make interest to pay interest and make a profit.
These are crooked financial business who claim to be banks but are stockholder owned and stockholder driven to make as big a profit they can and don't care who they hurt what they do as long as they make big bucks.
It didn't work this time and won't in the future. They turned everything into stocks that should have never been stocks. The stock market works to take money from investors not caring for the investor or the companies whose stock they sell only the money made from the transaction. Letting it all continue is wrong.

[racetoinfinity]

The reason they're called banks is that the Clinton Administration (at the urging of Robert Rubin and his protege Lawrence Summers) and Phil Gramm and the largely Rep. Congress passed the Financial Securities Modernization Acts and the Commodities Futures Modernization Acts, which allowed the merging of commercial banks, investment houses, insurance companies, etc.

There had been firewalls put up between them during the New Deal, as a corrective regulation against what caused the great crash and Great Depression, which these acts tore down.

This is one of the principal causes of the wild greedy speculative insanity with credit default swaps and "other mass weapons of financial self-destruction" (that were prohibited before these acts were passed) that has created the disaster we are sinking in.

[SharonMD]

I read the agreement requiring my signature just for opening a checking account. They are all the same, regardless of the bank, and they essentially take away your right to sue them if the screw you over--which they, not-surprisingly, then do at their whim. Personally, I would love to see the whole banking industry nationalized once and for all. The "Fed" is not a federal institution, despite the name implying it is--it is a private insitution. The "Chairman" may be named by the President, but that chairman is not beholden to the US Government. Americans need to write their representatives in Congress every day--make their voices heard in their votes every two years. Follow what is going on in Washington, DC, and know how your representatives voted. Ask for a response to your letters. If they do not act in accordance with your wishes--give them fair warning that you won't vote for them and then don't. Too many Americans take the priviledge of voting so lightly they do not exercise their rights, do not vote, and do not engage those who represent them. This should be a priority along with self-education. With the Internet as a tool, there is no excuse for not understanding what is happening and what you can do to make changes--and then doing it.

[gevan]

In free market capitalism when a particular product kills or destroys, the expectation is that fewer people will purchase that product. Hence the market corrects itself. But woe to those who got suckered in the first place. They are just free market losers. Now they might want their mommy government to save them. Good luck with that.

[Garvagh]

The ratings agencies labored mightily to set up this financial catastrophe. AAA ratings for garbage financial instruments.

[foresight]

American corporations and their disfunctional Banks had better get their greedy heads out of their perverbial asses and think about the homeland The UNITED STATES OF AMERICA and put their New World Order support group the One world conspiracy on the back burner. "BUY AMERICAN" Don't even think of spending the american taxpayers money anywhere else. God helps those who helps themselves. America has to stop spreading their disfunctional family ways on the rest or the world and come home to your own families. We are not at woodstock anymore.