A Britisher in Philadelphia: Prime Minister Theresa May speaks to the Republicans


January 27, 2017

A Britisher in Philadelphia: Prime Minister Theresa May speaks to the Republicans

The first foreign leader to visit Donald Trump, Prime Minister Theresa May spoke to Republicans on her country’s special relationship with the United States, bringing back memories of Ronald Reagan and Dame Margaret Thatcher.  Listen to this eloquent leader who is a “conservative”, not a populist. We are not sure about political leanings of President Donald Trump except to note that the 45th President of the United States is all about America First and Making America Great Again.–Din Merican

Trump’s Victory is a Wake-up Call


January 27, 2017

Trump’s Victory is a Wake-up Call: America First

By Michael S. H. Heng*

*Michael S. H. Heng is a retired professor who has held academic appointments in Australia, the Netherlands, and at 6 universities in Asia. He has published 5 books.

http://ippreview.com/index.php/Home/Blog/single/id/337.html

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The Controversial, Contentious, and Perplexing 45th President of the United States–Donald J Trump

Even without the benefit of hindsight, Donald Trump’s victory in the November 2016 US presidential election was not surprising. Although the majority of mainstream newspapers and opinion polls had predicted a victory for the Democrat candidate, a few sharp observers and analysts had been saying that the opposite would happen.

In 1989, Michael Moore made a movie “Roger and Me” about the devastation that descended on the city of Flint, Michigan after General Motors closed the car plant there. Since then we have seen 8 years of Bill Clinton and another 8 years of Barack Obama. What have the Democrats done to address the social and economic ills of Flint? Now the city is saddled with a water crisis, where the tainted tap water cannot be used for drinking, cooking or bathing. In the recent presidential election, the state of Michigan went to Donald Trump. This should have been predictable to any clear headed political observer.

The Bill Clinton presidency of 8 years was not as Hillary Clinton had put it: a great time of economic progress. That is what they like to think and persuade others to believe. Those were years that continued to favor the neo-liberal seeds planted earlier with the blessings of Ronald Reagan and the senior George Bush, with catastrophic blowback in the form of the 2008 financial crisis. The following 8 years of the junior George Bush were an unmitigated disaster with the invasions of Iraq and Afghanistan. But then came along Barack Obama with the promise of Hope and Change. The Great Recession ushered in by the financial crisis of 2008 was not used as an occasion to galvanize the nation to roll back the hanky-panky activities of the financial sector and to reinvent the economy. For 8 long years, his green shoots of recovery proved to be a disappointment. Millions of people just ceased to register as job seekers, because the jobs they were looking for had vanished. It was not unusual for a hotel doorman in New York City to juggle 3 jobs and his wife 2 jobs in order to make ends meet.1 Wages were so low and work so hard to come by.

The victory of Trump constitutes part of a global trend. It is a trend where the failure of ruling parties in the West and elsewhere to address the real and deeply felt grievances of their citizens have thrust political power or influence onto demagogues and xenophobes.  The populist backlash in the US was attributed in an analysis by Niall Ferguson to five factors: (a) surge in immigration, (b) rise in inequality, (c) increase in perception of political corruption, (d) the ongoing Great Recession, (e) the emergence of demagogues. When people are extremely fed up, they would prefer to listen to wild allegations and promises than to the “rational arguments” which have cheated them for too long.

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Rather than being consumed by rage, hate, and despair, it is better to treat Trump’s triumph as the serious symptom of a disease that has plagued social, cultural-intellectual, economic, and political life in the last few decades. Politically, it should be taken as a wake-up call for the political, media, bureaucratic, business, and academic elites who have benefited enormously from globalization and immigration.

Unless and until the problems faced by the working class are solved, it is safe to predict that phenomena more horrible than Trump’s victory are going to happen. In the worst-case scenario, they may pave the way for the demise of the peaceful and prosperous world order as we know it.

Without trying to be funny and cynical, it may be argued that Trump’s victory as a wake-up call is politically more valuable than a victory by Hillary Clinton. Her victory would have lent weight to the belief that the US has been doing pretty well. Sure, there are problems, but here comes another Clinton to solve them and make America even better.

History has provided many examples of how resistance by vested interests has resulted in the country experiencing economic difficulties and even demise, with vested interests buried with it.

Thinking along this line, it is wrong to disparage those angry and long-suffering citizens who turned anti-establishment and voted the thug-like and mendacious Trump into power. To blame those who voted for Trump is tantamount to blaming the victims of the past few decades for complaining and protesting. Instead of focusing attention on the gloomy horizon, it is better to think of ways to navigate away from it.

A good news is that Trump did not manage to win the popular vote, something that could have given him more political gravitas. Elsewhere, populist politicians have increased their influence, but are not strong enough yet to capture key political offices.

To reverse the further descent of politics, mainstream political parties will do well to do some sincere soul-searching. They have been living too long in their cozy world of make-believe, detached from the people they claim to serve, and uncritically swallowing the prescriptions of neoliberal economists. Have they for far too long been recruiting into their ranks ambitious people who take politics as an avenue for career advancement, just like their peers in the business world? Why have they failed to recruit those who are keen in their youth to take up politics as a calling? Why have they failed to fire up the enthusiasm of the youth in politics?  Have they been too nice in accommodating to the demands of big vested interests?

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At the level of ideas, there is a critical and urgent need to roll back the influence of market ideology in arenas that are patently not suitable for it, arenas such as healthcare and education. The political philosopher Michael Sandel has argued against the notion of the market society,2 and the political scientist Philip Bobbitt has written about the challenge of market state.3

At the level of the economy, there is an obvious need for reform. The US has the most enviable human resources and research infrastructure to conduct breakthrough scientific discoveries and technological innovations, which underpin high value-added economic activities. But somehow this great country has channeled its resources into financial engineering, which has inflicted destructive havoc on the real economy, and brought misery to millions of Americans and many more elsewhere in the world. The real enemy of America is Wall Street and other vested interests. Unless the value-destroying financial sector is tamed, with the rich sharing part of their wealth with the poor, and resources redirected to productive areas of research and development in the real economy, the once appealing American Dream will become more like an elusive dream, and to the most disadvantaged, a real nightmare.

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Perhaps the most challenging task is at the level of politics. How can the political class sink their petty quarrels in a genuine effort to make America great again? It calls for political reform that will demand a compromise from vested interests in both the economy and politics. History has provided many examples of how resistance by vested interests has resulted in the country experiencing economic difficulties and even demise, with vested interests buried with it. The challenge now, greater than ever before, confronts those politically conscious progressives to unite in their lofty project in order to pressure the elites to bow to economic and political reform.

At a philosophical level, here is a profound insight from Tao Te Ching by Laozi.4

Disaster is that on which good fortune depends.
Good fortune is that in which disaster’s concealed.
Who knows where it will end?

Notes

  1. Lie, C-I (2016, November 20). Private communications.
  1. Sandel, M. J. (2013). What Money Can’t Buy: The Moral Limits of Markets. Farrar, Straus and Giroux.
  1. Bobbitt, P. (2008). Terror and Consent: The Wars for the Twenty-first Century. A. A. Knopf.
  1. Henricks, R. G. trans. (1992). Tao Te Ching. New York: Random House, chapter 58.

Additional Reading:

http://www.politico.com/magazine/story/2016/03/donald-trump-the-perfect-populist-213697

2. Book Review: Theresa Gessler.

http://blogs.lse.ac.uk/politicsandpolicy/book-review-what-is-populism-by-jan-werner-muller/

Fareed Zakaria from Davos, Switzerland


January 25, 2017

Fareed Zakaria from Davos, Switzerland

https://www.washingtonpost.com/opinions/everyone-seems-to-agree-globalization-is-a-sin-theyre-wrong/2017/01/19/49bded68-de8b-11e6-918c-99ede3c8cafa_story.html?utm_term=.2786e5e7a9d7

The World Economic Forum this year feels like an exercise in ritual self-flagellation, which — as with the old Christian practice of fasting and whipping one’s own body — is supposed to purify the sinful nature of man. The sin, of course, is globalization, which everyone now seems to agree has been lopsided, inequitable and dangerous. In fact, most of the flaws attributed to globalization are actually mistakes in national policy that can be corrected.

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It took a Chinese billionaire to speak frankly on this topic. Jack Ma, the founder of the e-commerce giant Alibaba, estimated that over the past three decades the U.S. government spent $14.2 trillion fighting 13 wars. That money could have been invested in America, building infrastructure and creating jobs. “You’re supposed to spend money on your own people,” he said. He pointed out that globalization produced massive profits for the U.S. economy but much of that money ended up on Wall Street. “And what happened? Year 2008. The financial crisis wiped out $19.2 trillion [in the] U.S.A. alone. . . . What if the money [had been] spent on the Midwest of the United States developing the industry there?” he asked. “It’s not [that] the other countries steal jobs from you guys — it is your strategy,” he concluded.

You don’t have to accept Ma’s specifics and statistics to recognize the validity of his general point. Globalization created huge opportunities for growth, many of which were taken by U.S. companies. The global economy is still dominated by large American firms; 134 of Fortune’s Global 500 are American. And if you look at those in cutting-edge industries, the vast majority are American. These companies have benefited enormously by having global supply chains that can source goods and services around the world, either to lower labor costs or to be close to the markets in which they sell. Since 95 percent of the world’s potential consumers live outside the United States, finding ways to sell to them will have to be a core strategy for growth, even for a country with a large domestic economy such as the United States.

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Jack Ma said “It’s not [that] the other countries steal jobs from you guys — it is your strategy”

Obviously globalization has large effects on national economies and societies, and it produces some significant problems. What complex phenomenon does not? But it also generates opportunities, innovation and wealth for nations that they can then use to address these problems through good national strategies. The solutions are easy to state in theory — education, skills-based training and retraining, infrastructure. But they are extremely expensive and hard to execute well.

It is much easier to rail against foreigners and promise to fight them with tariffs and fines. But the cost of addressing these problems at the global level is massive. The Economist reports, in a survey on globalization, that in 2009 the Obama administration punished China with a tariff on its tires. Two years later, the cost to U.S. consumers was $1.1 billion, or $900,000 for every job “saved.” The impact of such tariffs is usually felt disproportionately by the poor and middle class because they spend a larger share of their income on imported goods, such as food and clothing. That same Economist survey points to a study that calculated that, across 40 countries, if transnational trade ended, the wealthiest consumers would lose 28 percent of their purchasing power, but the poorest tenth would lose a staggering 63 percent.

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Keeping pace with technology change–Learn, Unlearn and Relearn

Perhaps most important, the key driver depressing wages and eliminating jobs in the industrialized world is technology, not globalization. For example, between 1990 and 2014, U.S. automotive production increased by 19 percent , but with 240,000 fewer workers.

Even when manufacturing comes back to the United States, it is high-end manufacturing. It’s not just new Intel plants that have few workers anymore. Adidas has set up a new shoe factory in Germany that is run almost entirely by robots. It will open a similar one near Atlanta later this year. And the few workers in these factories tend to be highly skilled technicians and software engineers.

You can’t turn off technological revolutions. Nor is there a quick fix to stop business from going to other countries. Tariffs on China will simply mean that production will come from some other developing country.

The best approach to the world we are living in is not denial but empowerment. Countries should recognize that the global economy and the technological revolution require large, sustained national efforts to equip workers with the skills, capital and infrastructure they need to succeed. Nations should embrace an open world, but only as long as they are properly armed to compete in it. And that requires smart, effective — and very expensive — national policies, not some grand reversal of globalization.

Ben Rhodes sums up Obama’s Foreign Policy Legacy–Engagement


January 19, 2017

Mag - Ben Rhodes - Print Issue

Washington And The World

http://www.politico.com/magazine/story/2017/01/obama-foreign-policy-legacy-ben-rhodes-donald-trump-china-iran-214642

Ben Rhodes sums up Obama’s Foreign Policy Legacy–Engagement

Obama’s Foreign Policy Messenger opens up about the world the outgoing President leaves behind—and what Trump could do with it.– Engagement

Michael Crowley: Is there any way to sum up on a bumper sticker—or at least a postcard—what the foreign policy legacy of the last eight years is?

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Obama’s Foreign Policy is Engagement with Beautiful and Brilliant Michelle by his side. She kept him sober, calm, humble and saane. Behind every guy in power is Women greater than himself. Some like Michelle are like Caesar’s wife while others like Malaysia’s Rosmah Mansor are in the image of Lady Macbeth.

Ben Rhodes: A single word I would apply is Engagement. We’ve engaged diplomatically around the world. We’ve engaged former adversaries. We’ve engaged publics. We’ve sought to work through multilateral coalitions and institutions with the purpose of repositioning the United States to lead.

When we came into office, the confidence in U.S. global leadership had severely eroded because of two events: the Iraq War and the financial crisis. This is underappreciated, that the global financial crisis almost did more than the Iraq War to erode confidence in the United States. But the one thing people could always count on us for, even if they disagreed with our foreign policies, was our centrality to the global economic order.

A lot of what we did was to restore the United States at the center of the international order. People have criticized us for presiding over a decline. I think we make the opposite argument: that we were in decline and that we—by both husbanding our resources, investing in our economy, and being opportunistic diplomatically—tried to set the United States up for being in a stronger position in a changing world than where we were when we came in.

Crowley: What surprised you most along the way?

Rhodes: I would say a couple of things. One, the Arab Spring obviously overwhelmed the circuits. There’s an intensity [to the period from] 2011 to 2014, when a 100-year storm took place in three years.1 Two, there is a discordance between the nature of power in the current moment and how Washington thinks about foreign policy that you can only appreciate if you’re in these jobs. A lot of thinking in both political parties was understandably shaped by the 1990 to 2002 window, when the United States had a great deal of freedom of action. We could get anything through the U.N. Security Council that we wanted, with some small exceptions. We could, frankly, interfere in the internal affairs of other countries in a host of different ways. We could count on Russia being on its back foot as we enlarged NATO. We had some time before the Chinese started to try to shape events in their neighborhoods. And we could even have the hubris to think that it made sense to invade and occupy Iraq. What hasn’t changed is the United States is still, by far, the most powerful country. But what has changed is there are other power centers that are going to ensure that there are limits on certain things that the United States wants to do.

Crowley: How do you think history is going to judge the administration’s record on Syria?2 People say it in the same breath as Rwanda. That may or not be fair, but what’s it like to hear that on a personal level?

Rhodes: I went through an evolution on Syria. I came into this job shaped by the post-Rwanda view of liberal interventionism3—suspicious of some amount of U.S. military intervention, but also seized with the necessity of acting in certain situations. I was a vocal advocate of [going into] Libya,4 and in the early days of the Syrian conflict, I was an advocate for military action in Syria. And I believe that I was wrong about that. Everything that I have learned about watching that conflict unfold suggests to me that the president’s refusal to get into a military conflict with the Assad regime was actually one of his best decisions. And I don’t expect that view to be the popular view for a long time, if ever. But he tested every possible option, and at no time was there a viable military option to make things better in Syria.

Crowley: Does that imply that his mistake in the “red line” episode5 was drawing the line in the first place?

Rhodes: Well, drawing the line actually did provide the basis for a diplomatic effort to remove the chemical weapons program peacefully.6 I don’t know how we could have started a military conflict with Assad that we didn’t feel compelled to try to finish by taking out Assad. Even if you do that, there’s no reason to believe that people would have simply reconciled with one another because the United States was a party to the conflict. And never mind the fact that we had no international support. The only country in the world that was prepared to join us was France. And we had no domestic legal basis. We actually had Congress warning us against taking action without congressional authorization, which we interpreted as the president could face impeachment.

Crowley: Really? Was the prospect of impeachment actually a factor in your conversations?

Rhodes: That was a factor. Go back and read the letters from Boehner7, letters from the Republican members of Congress. They laid down markers that this would not be constitutional. If we got drawn into a conflict in Syria without congressional authorization, without international authorization, without international support, you can see very clearly how that could have completely derailed this entire presidency.

Crowley: In the ’90s, Clinton White House officials were basically hugged on the street and kissed by Kosovar Muslims.8 You were confronted by some Syrian activists after a dinner and, reportedly, said that you’re not proud of our policy in Syria.9 On a personal level, what is it like to have people say to you, “Your country has so much power and you have let us down.”

Rhodes: It’s difficult. And again, I’ve thought a lot about the Balkans10 because that is the one example of military intervention that, while complicated, succeeded. But that was in the middle of Europe. You had NATO and the investment of Europeans in seeing it through. We notified Russia as we were bombing. Syria could not be more different. And what I found in general in the Middle East is you aren’t going to make people happy. We cannot resolve the issues internal to these countries. What I feel bad about is the fact that they’re just ordinary people who are caught in the middle of this.

What’s strange is, I met with the Syrian opposition, and often they would argue that we should work with al-Nusra, who we know is Al Qaeda.11 And I’m sympathetic if you’re in a neighborhood where al-Nusra is defending you against Assad. You want us to work with them. But let’s say a U.S. president does that, and then al-Nusra is using weapons that we gave them against us. That’s something you never recover from, right?

Crowley: So with Donald Trump, you worked really hard on the Iran deal, the relationship with China, climate, all kinds of things—and here comes a wrecking ball. That must be an incredibly frustrating feeling.

Rhodes: There are concerns. The world order and American actions in the world have deep wiring. We found that when we came into office. It took us a long time to turn the ocean liner around. If you look at something like climate change, the Paris agreement12 is the framework through which the world is going to deal with climate change, and we built that over seven years. And countries have redesigned their entire energy plans around it. China is not going to, I think, stop its conversion to a clean energy economy because Donald Trump lifts some restrictions on coal plants. The Cuba opening,13 we broke a psychological hurdle that is never going to be fully restored. Our hope is that they continue the Iran deal. If they don’t, the tragedy will not be that we lose a legacy in two minutes.

Crowley: Hillary Clinton’s campaign made a big deal about Trump and the nuclear button. Is that something you’ll leave here worrying about at night?

Rhodes: What concerns me is the things that happen every week. I don’t think people realize how many decisions the president of the United States makes about military action. The Iranians harass some vessel of ours in the Persian Gulf: What do we do in response? There’s shelling around our diplomatic facility in X Middle Eastern country. The Chinese pass too close for comfort by a U.S. Navy ship in the South China Sea. These decisions come all the time, and they’re going to come from Day One. I would be more focused on that. Because a dust-up with the Iranians or the Chinese could get out of hand very fast.

Crowley: You’d never been in government before 2009 and have had this incredible eight-year journey. What was your most amazing or surreal moment?

Rhodes: On Cuba, when I went to the Vatican,14 the cardinal [Pietro Parolin, the Vatican secretary of state] and his staff did not know what we were coming there to do. We told them that we were going to restore diplomatic relations and begin normalizing relations. One of the guys who worked for the cardinal, I’ll never forget, started literally crying. And I remember we had this long ceremony in this ornate room, and then I remember walking out into the streets of Rome and being anonymous and thinking, “I know something nobody else knows except for like 15 people. But it’s going to blow everybody’s mind.”

Crowley: You started as a speechwriter but also became a diplomat and a policymaker. But you’ve also become a lightning rod for people who don’t like Obama’s foreign policy.15 You symbolize everything he does wrong in their view. Why do you think that is? And is there something you think people misunderstand about you?

Rhodes: No. 1, part of my job is to be the lightning rod and to take the hits so he doesn’t take them or [national security adviser] Susan [Rice] doesn’t take them, although she took her share. I always volunteered to go out on the worst days.

Crowley: Like when?

Rhodes: Our first declaration that Syria used chemical weapons and after the [November 2015] Paris attacks. I saw that as my job.

Two, I would have the fights that I knew were going to be the most difficult fights. So we challenged convention and we touched the rails in making a deal with Iran or opening to Cuba, and those were the portfolios I took on precisely because I knew they were important to the president. And it was going to be harder for a conventional person to take them on. I had a certain freedom of movement because I’m not thinking about whether I’m going to be confirmable as the deputy secretary of state in four years. I’m thinking about implementing Barack Obama’s agenda.

Third, I guess I’m just young and a different profile and I know that that upsets people, but I always felt that I represented the people who elected President Obama, who were young people and they should have a voice and their worldview is our worldview. They think it’s stupid not to engage people. They don’t know why we wouldn’t make a deal with Iran.

I didn’t come here from fiction-writing grad school. I came here from six years working on the 9/11 Commission and the Iraq Study Group with Lee Hamilton.16 But the president wanted a mix of people. And Bob Gates gave him one view and Hillary Clinton gave him one view and John Kerry gave him one view, and I was just one of many different views. It’s not like he stocked his whole administration with people like me. But I think he wanted somebody who hadn’t been shaped by the same amount of immersion in the conventional ways of doing things.

What I take issue with is that we were spinning. We believed in these things. There are very few things I’ve ever been a part of that I believe in more than the Iran deal, and everything I said I believe to be true, and I was trying to make a case about the facts. So this notion of trying to spin things … I’m accused of being political. The issues I worked on were not the politically popular things. If I was political, I would go out there and talk about killing the terrorists. Anybody who knows me knows I spent more time on Burma and Laos. Where’s the political benefit in that?

This is an important thing for people to understand. I became very close to a lot of the under-40 people who are the professionals in the government—foreign service officers, civil servants, intelligence analysts. I think one of the critiques of me is that I thought I knew it all. But I was learning from the enormous resources available within the U.S. government who have a very different view of the world than many of the people commenting on foreign policy from outside of the government. And I’m struck by the disconnect between the people who’ve staffed this enterprise, U.S. foreign policy since 9/11—and some of the people who comment on it.17

Crowley: What are you going to do now?

Rhodes: I’ll write some form of a memoir, one that will also be an argument on behalf of what we were doing. And I’m going to be a Senior Adviser to the President on his international work, including at his foundation.

 

Theresa May–A Global Britain Post BREXIT


January 17, 2017

Theresa May– A Global Britain Post BREXIT

In a major speech on Tuesday, the British Prime Minister Theresa May outlined a 12-point plan on what relationship Britain will seek to have with the E.U. once it leaves the bloc. Here’s the text of her speech, as delivered at London’s Lancaster House on January 17, 2017

A little over six months ago, the British people voted for change.

They voted to shape a brighter future for our country.

They voted to leave the European Union and embrace the world.

And they did so with their eyes open: accepting that the road ahead will be uncertain at times, but believing that it leads towards a brighter future for their children – and their grandchildren too.

And it is the job of this Government to deliver it. That means more than negotiating our new relationship with the EU. It means taking the opportunity of this great moment of national change to step back and ask ourselves what kind of country we want to be.

My answer is clear. I want this United Kingdom to emerge from this period of change stronger, fairer, more united and more outward-looking than ever before. I want us to be a secure, prosperous, tolerant country – a magnet for international talent and a home to the pioneers and innovators who will shape the world ahead. I want us to be a truly Global Britain – the best friend and neighbour to our European partners, but a country that reaches beyond the borders of Europe too. A country that gets out into the world to build relationships with old friends and new allies alike.

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I want Britain to be what we have the potential, talent and ambition to be. A great, global trading nation that is respected around the world and strong, confident and united at home.

A Plan for Britain

That is why this Government has a Plan for Britain. One that gets us the right deal abroad but also ensures we get a better deal for ordinary working people at home.

It’s why that plan sets out how we will use this moment of change to build a stronger economy and a fairer society by embracing genuine economic and social reform.

Why our new Modern Industrial Strategy is being developed, to ensure every nation and area of the United Kingdom can make the most of the opportunities ahead. Why we will go further to reform our schools to ensure every child has the knowledge and the skills they need to thrive in post-Brexit Britain. Why as we continue to bring the deficit down, we will take a balanced approach by investing in our economic infrastructure – because it can transform the growth potential of our economy, and improve the quality of people’s lives across the whole country.

It’s why we will put the preservation of our precious Union at the heart of everything we do. Because it is only by coming together as one great union of nations and people that we can make the most of the opportunities ahead.

The result of the referendum was not a decision to turn inward and retreat from the world.

Because Britain’s history and culture is profoundly internationalist.

We are a European country – and proud of our shared European heritage – but we are also a country that has always looked beyond Europe to the wider world. That is why we are one of the most racially diverse countries in Europe, one of the most multicultural members of the European Union, and why – whether we are talking about India, Pakistan, Bangladesh, America, Australia, Canada, New Zealand, countries in Africa or those that are closer to home in Europe – so many of us have close friends and relatives from across the world.

Instinctively, we want to travel to, study in, trade with countries not just in Europe but beyond the borders of our continent. Even now as we prepare to leave the EU, we are planning for the next biennial Commonwealth Heads of Government meeting in 2018 – a reminder of our unique and proud global relationships.

A message from Britain to the rest of Europe

And it is important to recognise this fact. June the 23rd was not the moment Britain chose to step back from the world. It was the moment we chose to build a truly Global Britain.

I know that this – and the other reasons Britain took such a decision – is not always well understood among our friends and allies in Europe. And I know many fear that this might herald the beginning of a greater unravelling of the EU.

But let me be clear: I do not want that to happen. It would not be in the best interests of Britain. It remains overwhelmingly and compellingly in Britain’s national interest that the EU should succeed. And that is why I hope in the months and years ahead we will all reflect on the lessons of Britain’s decision to leave.

So let me take this opportunity to set out the reasons for our decision and to address the people of Europe directly.

It’s not simply because our history and culture is profoundly internationalist, important though that is. Many in Britain have always felt that the United Kingdom’s place in the European Union came at the expense of our global ties, and of a bolder embrace of free trade with the wider world.

There are other important reasons too.

Our political traditions are different. Unlike other European countries, we have no written constitution, but the principle of Parliamentary Sovereignty is the basis of our unwritten constitutional settlement. We have only a recent history of devolved governance – though it has rapidly embedded itself – and we have little history of coalition government. The public expect to be able to hold their governments to account very directly, and as a result supranational institutions as strong as those created by the European Union sit very uneasily in relation to our political history and way of life.

And, while I know Britain might at times have been seen as an awkward member state, the European Union has struggled to deal with the diversity of its member countries and their interests. It bends towards uniformity, not flexibility. David Cameron’s negotiation was a valiant final attempt to make it work for Britain – and I want to thank all those elsewhere in Europe who helped him reach an agreement – but the blunt truth, as we know, is that there was not enough flexibility on many important matters for a majority of British voters.

Now I do not believe that these things apply uniquely to Britain. Britain is not the only member state where there is a strong attachment to accountable and democratic government, such a strong internationalist mindset, or a belief that diversity within Europe should be celebrated. And so I believe there is a lesson in Brexit not just for Britain but, if it wants to succeed, for the EU itself.

Because our continent’s great strength has always been its diversity. And there are two ways of dealing with different interests. You can respond by trying to hold things together by force, tightening a vice-like grip that ends up crushing into tiny pieces the very things you want to protect. Or you can respect difference, cherish it even, and reform the EU so that it deals better with the wonderful diversity of its member states.

So to our friends across Europe, let me say this.

Our vote to leave the European Union was no rejection of the values we share. The decision to leave the EU represents no desire to become more distant to you, our friends and neighbours. It was no attempt to do harm to the EU itself or to any of its remaining member states. We do not want to turn the clock back to the days when Europe was less peaceful, less secure and less able to trade freely. It was a vote to restore, as we see it, our parliamentary democracy, national self-determination, and to become even more global and internationalist in action and in spirit.

We will continue to be reliable partners, willing allies and close friends. We want to buy your goods and services, sell you ours, trade with you as freely as possible, and work with one another to make sure we are all safer, more secure and more prosperous through continued friendship.

You will still be welcome in this country as we hope our citizens will be welcome in yours. At a time when together we face a serious threat from our enemies, Britain’s unique intelligence capabilities will continue to help to keep people in Europe safe from terrorism. And at a time when there is growing concern about European security, Britain’s servicemen and women, based in European countries including Estonia, Poland and Romania, will continue to do their duty.

We are leaving the European Union, but we are not leaving Europe.

And that is why we seek a new and equal partnership – between an independent, self-governing, Global Britain and our friends and allies in the EU.

Not partial membership of the European Union, associate membership of the European Union, or anything that leaves us half-in, half-out. We do not seek to adopt a model already enjoyed by other countries. We do not seek to hold on to bits of membership as we leave.

No, the United Kingdom is leaving the European Union. And my job is to get the right deal for Britain as we do.

Objectives and Ambitions

So today I want to outline our objectives for the negotiation ahead. 12 objectives that amount to one big goal: a new, positive and constructive partnership between Britain and the European Union.

And as we negotiate that partnership, we will be driven by some simple principles: we will provide as much certainty and clarity as we can at every stage. And we will take this opportunity to make Britain stronger, to make Britain fairer, and to build a more Global Britain too.

Certainty and clarity

1. Certainty

The first objective is crucial. We will provide certainty wherever we can.

We are about to enter a negotiation. That means there will be give and take. There will have to be compromises. It will require imagination on both sides. And not everybody will be able to know everything at every stage.

But I recognise how important it is to provide business, the public sector, and everybody with as much certainty as possible as we move through the process.

So where we can offer that certainty, we will do so.

That is why last year we acted quickly to give clarity about farm payments and university funding.

And it is why, as we repeal the European Communities Act, we will convert the “acquis” – the body of existing EU law – into British law.

This will give the country maximum certainty as we leave the EU. The same rules and laws will apply on the day after Brexit as they did before. And it will be for the British Parliament to decide on any changes to that law after full scrutiny and proper Parliamentary debate.

And when it comes to Parliament, there is one other way in which I would like to provide certainty. I can confirm today that the Government will put the final deal that is agreed between the UK and the EU to a vote in both Houses of Parliament, before it comes into force.

A Stronger Britain

Our second guiding principle is to build a stronger Britain.

2. Control of our own laws

That means taking control of our own affairs, as those who voted in their millions to leave the European Union demanded we must.

So we will take back control of our laws and bring an end to the jurisdiction of the European Court of Justice in Britain.

Leaving the European Union will mean that our laws will be made in Westminster, Edinburgh, Cardiff and Belfast. And those laws will be interpreted by judges not in Luxembourg but in courts across this country.

Because we will not have truly left the European Union if we are not in control of our own laws.

3. Strengthen the Union

A stronger Britain demands that we do something else – strengthen the precious union between the four nations of the United Kingdom.

At this momentous time, it is more important than ever that we face the future together, united by what makes us strong: the bonds that unite us as a people, and our shared interest in the UK being an open, successful trading nation in the future.

And I hope that same spirit of unity will apply in Northern Ireland in particular over the coming months in the National Assembly elections, and the main parties there will work together to re-establish a partnership government as soon as possible.

Foreign affairs are of course the responsibility of the UK Government, and in dealing with them we act in the interests of all parts of the United Kingdom. As Prime Minister, I take that responsibility seriously.

I have also been determined from the start that the devolved administrations should be fully engaged in this process.

That is why the Government has set up a Joint Ministerial Committee on EU Negotiations, so ministers from each of the UK’s devolved administrations can contribute to the process of planning for our departure from the European Union.

We have already received a paper from the Scottish Government, and look forward to receiving a paper from the Welsh Government shortly. Both papers will be considered as part of this important process. We won’t agree on everything, but I look forward to working with the administrations in Scotland, Wales and Northern Ireland to deliver a Brexit that works for the whole of the United Kingdom.

Part of that will mean working very carefully to ensure that – as powers are repatriated from Brussels back to Britain – the right powers are returned to Westminster, and the right powers are passed to the devolved administrations of Scotland, Wales and Northern Ireland.

As we do so, our guiding principle must be to ensure that – as we leave the European Union – no new barriers to living and doing business within our own Union are created,

That means maintaining the necessary common standards and frameworks for our own domestic market, empowering the UK as an open, trading nation to strike the best trade deals around the world, and protecting the common resources of our islands.

And as we do this, I should equally be clear that no decisions currently taken by the devolved administrations will be removed from them.

4. Maintain the Common Travel Area with Ireland

We cannot forget that, as we leave, the United Kingdom will share a land border with the EU, and maintaining that Common Travel Area with the Republic of Ireland will be an important priority for the UK in the talks ahead.

There has been a Common Travel Area between the United Kingdom and the Republic of Ireland for many years. Indeed, it was formed before either of our two countries were members of the European Union. And the family ties and bonds of affection that unite our two countries mean that there will always be a special relationship between us.

So we will work to deliver a practical solution that allows the maintenance of the Common Travel Area with the Republic, while protecting the integrity of the United Kingdom’s immigration system.

Nobody wants to return to the borders of the past, so we will make it a priority to deliver a practical solution as soon as we can.

A Fairer Britain

The third principle is to build a fairer Britain. That means ensuring it is fair to everyone who lives and works in this country.

5. Control of immigration

And that is why we will ensure we can control immigration to Britain from Europe.

We will continue to attract the brightest and the best to work or study in Britain – indeed openness to international talent must remain one of this country’s most distinctive assets – but that process must be managed properly so that our immigration system serves the national interest.

So we will get control of the number of people coming to Britain from the EU.

Because while controlled immigration can bring great benefits – filling skills shortages, delivering public services, making British businesses the world-beaters they often are – when the numbers get too high, public support for the system falters.

In the last decade or so, we have seen record levels of net migration in Britain, and that sheer volume has put pressure on public services, like schools, stretched our infrastructure, especially housing, and put a downward pressure on wages for working class people. As Home Secretary for six years, I know that you cannot control immigration overall when there is free movement to Britain from Europe.

Britain is an open and tolerant country. We will always want immigration, especially high-skilled immigration, we will always want immigration from Europe, and we will always welcome individual migrants as friends. But the message from the public before and during the referendum campaign was clear: Brexit must mean control of the number of people who come to Britain from Europe. And that is what we will deliver.

6. Rights for EU nationals in Britain, and British nationals in the EU

Fairness demands that we deal with another issue as soon as possible too. We want to guarantee the rights of EU citizens who are already living in Britain, and the rights of British nationals in other member states, as early as we can.

I have told other EU leaders that we could give people the certainty they want straight away, and reach such a deal now.

Many of them favour such an agreement – one or two others do not – but I want everyone to know that it remains an important priority for Britain – and for many other member states – to resolve this challenge as soon as possible. Because it is the right and fair thing to do.

7. Protect workers’ rights

And a fairer Britain is a country that protects and enhances the rights people have at work.

That is why, as we translate the body of European law into our domestic regulations, we will ensure that workers rights are fully protected and maintained.

Indeed, under my leadership, not only will the Government protect the rights of workers’ set out in European legislation, we will build on them. Because under this Conservative Government, we will make sure legal protection for workers keeps pace with the changing labour market – and that the voices of workers are heard by the boards of publicly-listed companies for the first time.

A Truly Global Britain

But the great prize for this country – the opportunity ahead – is to use this moment to build a truly Global Britain. A country that reaches out to old friends and new allies. A great, global, trading nation. And one of the firmest advocates for free trade anywhere in the world.

8. Free trade with European markets

That starts with our close friends and neighbours in Europe. So as a priority, we will pursue a bold and ambitious Free Trade Agreement with the European Union.

This agreement should allow for the freest possible trade in goods and services between Britain and the EU’s member states. It should give British companies the maximum freedom to trade with and operate within European markets – and let European businesses do the same in Britain.

But I want to be clear. What I am proposing cannot mean membership of the EU’s Single Market.

European leaders have said many times that membership means accepting the “four freedoms” of goods, capital, services and people. And being out of the EU but a member of the Single Market would mean complying with the EU’s rules and regulations that implement those freedoms, without having a vote on what those rules and regulations are. It would mean accepting a role for the European Court of Justice that would see it still having direct legal authority in our country.

It would to all intents and purposes mean not leaving the EU at all.

And that is why both sides in the referendum campaign made it clear that a vote to leave the EU would be a vote to leave the Single Market.

So we do not seek membership of the Single Market. Instead we seek the greatest possible access to it through a new, comprehensive, bold and ambitious Free Trade Agreement.

That Agreement may take in elements of current Single Market arrangements in certain areas – on the export of cars and lorries for example, or the freedom to provide financial services across national borders – as it makes no sense to start again from scratch when Britain and the remaining Member States have adhered to the same rules for so many years.

But I respect the position taken by European leaders who have been clear about their position, just as I am clear about mine. So an important part of the new strategic partnership we seek with the EU will be the pursuit of the greatest possible access to the Single Market, on a fully reciprocal basis, through a comprehensive Free Trade Agreement.

And because we will no longer be members of the Single Market, we will not be required to contribute huge sums to the EU budget. There may be some specific European programmes in which we might want to participate. If so, and this will be for us to decide, it is reasonable that we should make an appropriate contribution. But the principle is clear: the days of Britain making vast contributions to the European Union every year will end.

9. New trade agreements with other countries

But it is not just trade with the EU we should be interested in. A Global Britain must be free to strike trade agreements with countries from outside the European Union too.

Because important though our trade with the EU is and will remain, it is clear that the UK needs to increase significantly its trade with the fastest growing export markets in the world.

Since joining the EU, trade as a percentage of GDP has broadly stagnated in the UK. That is why it is time for Britain to get out into the world and rediscover its role as a great, global, trading nation.

This is such a priority for me that when I became Prime Minister I established, for the first time, a Department for International Trade, led by Liam Fox.

We want to get out into the wider world, to trade and do business all around the globe. Countries including China, Brazil, and the Gulf States have already expressed their interest in striking trade deals with us. We have started discussions on future trade ties with countries like Australia, New Zealand and India. And President Elect Trump has said Britain is not “at the back of the queue” for a trade deal with the United States, the world’s biggest economy, but front of the line.

I know my emphasis on striking trade agreements with countries outside Europe has led to questions about whether Britain seeks to remain a member of the EU’s Customs Union. And it is true that full Customs Union membership prevents us from negotiating our own comprehensive trade deals.

Now, I want Britain to be able to negotiate its own trade agreements. But I also want tariff-free trade with Europe and cross-border trade there to be as frictionless as possible.

That means I do not want Britain to be part of the Common Commercial Policy and I do not want us to be bound by the Common External Tariff. These are the elements of the Customs Union that prevent us from striking our own comprehensive trade agreements with other countries. But I do want us to have a customs agreement with the EU.

Whether that means we must reach a completely new customs agreement, become an associate member of the Customs Union in some way, or remain a signatory to some elements of it, I hold no preconceived position. I have an open mind on how we do it. It is not the means that matter, but the ends.

And those ends are clear: I want to remove as many barriers to trade as possible. And I want Britain to be free to establish our own tariff schedules at the World Trade Organisation, meaning we can reach new trade agreements not just with the European Union but with old friends and new allies from outside Europe too.

10. The best place for science and innovation

A Global Britain must also be a country that looks to the future. That means being one of the best places in the world for science and innovation.

One of our great strengths as a nation is the breadth and depth of our academic and scientific communities, backed up by some of the world’s best universities. And we have a proud history of leading and supporting cutting-edge research and innovation.

So we will also welcome agreement to continue to collaborate with our European partners on major science, research, and technology initiatives.

From space exploration to clean energy to medical technologies, Britain will remain at the forefront of collective endeavours to better understand, and make better, the world in which we live.

11. Cooperation in the fight against crime and terrorism

And a Global Britain will continue to cooperate with its European partners in important areas such as crime, terrorism and foreign affairs.

All of us in Europe face the challenge of cross-border crime, a deadly terrorist threat, and the dangers presented by hostile states. All of us share interests and values in common, values we want to see projected around the world.

With the threats to our common security becoming more serious, our response cannot be to cooperate with one another less, but to work together more. I therefore want our future relationship with the European Union to include practical arrangements on matters of law enforcement and the sharing of intelligence material with our EU allies.

I am proud of the role Britain has played and will continue to play in promoting Europe’s security. Britain has led Europe on the measures needed to keep our continent secure – whether it is implementing sanctions against Russia following its action in Crimea, working for peace and stability in the Balkans, or securing Europe’s external border. We will continue to work closely with our European allies in foreign and defence policy even as we leave the EU itself.

A phased approach

12. A smooth, orderly Brexit

These are our objectives for the negotiation ahead – objectives that will help to realise our ambition of shaping that stronger, fairer, Global Britain that we want to see.

They are the basis for a new, strong, constructive partnership with the European Union – a partnership of friends and allies, of interests and values. A partnership for a strong EU and a strong UK.

But there is one further objective we are setting. For as I have said before – it is in no one’s interests for there to be a cliff-edge for business or a threat to stability, as we change from our existing relationship to a new partnership with the EU.

By this, I do not mean that we will seek some form of unlimited transitional status, in which we find ourselves stuck forever in some kind of permanent political purgatory. That would not be good for Britain, but nor do I believe it would be good for the EU.

Instead, I want us to have reached an agreement about our future partnership by the time the two-year Article Fifty process has concluded. From that point onwards, we believe a phased process of implementation, in which both Britain and the EU institutions and member states prepare for the new arrangements that will exist between us will be in our mutual self-interest. This will give businesses enough time to plan and prepare for those new arrangements.

This might be about our immigration controls, customs systems or the way in which we cooperate on criminal justice matters. Or it might be about the future legal and regulatory framework for financial services. For each issue, the time we need to phase-in the new arrangements may differ. Some might be introduced very quickly, some might take longer. And the interim arrangements we rely upon are likely to be a matter of negotiation.

But the purpose is clear: we will work to avoid a disruptive cliff-edge, and we will do everything we can to phase in the new arrangements we require as Britain and the EU move towards our new partnership.

The Right Deal for Britain

So, these are the objectives we have set. Certainty wherever possible. Control of our own laws. Strengthening the United Kingdom. Maintaining the Common Travel Area with Ireland. Control of immigration. Rights for EU nationals in Britain, and British nationals in the EU. Enhancing rights for workers. Free trade with European markets. New trade agreements with other countries. A leading role in science and innovation. Cooperation on crime, terrorism and foreign affairs. And a phased approach, delivering a smooth and orderly Brexit.

This is the framework of a deal that will herald a new partnership between the UK and the EU.

It is a comprehensive and carefully considered plan that focuses on the ends, not just the means – with its eyes fixed firmly on the future, and on the kind of country we will be once we leave.

It reflects the hard work of many in this room today who have worked tirelessly to bring it together and to prepare this country for the negotiation ahead.

And it will, I know, be debated and discussed at length. That is only right. But those who urge us to reveal more – such as the blow-by-blow details of our negotiating strategy, the areas in which we might compromise, the places where we think there are potential trade-offs – will not be acting in the national interest.

Because this is not a game or a time for opposition for opposition’s sake. It is a crucial and sensitive negotiation that will define the interests and the success of our country for many years to come. And it is vital that we maintain our discipline.

That is why I have said before – and will continue to say – that every stray word and every hyped up media report is going to make it harder for us to get the right deal for Britain. Our opposite numbers in the European Commission know it, which is why they are keeping their discipline. And the ministers in this Government know it too, which is why we will also maintain ours.

So however frustrating some people find it, the Government will not be pressured into saying more than I believe it is in our national interest to say. Because it is not my job to fill column inches with daily updates, but to get the right deal for Britain. And that is what I intend to do.

A new partnership between Britain and Europe

I am confident that a deal – and a new strategic partnership between the UK and the EU – can be achieved.

This is firstly because, having held conversations with almost every leader from every single EU member state; having spent time talking to the senior figures from the European institutions, including President Tusk, President Juncker, and President Schulz; and after my Cabinet colleagues David Davis, Philip Hammond and Boris Johnson have done the same with their interlocutors, I am confident that the vast majority want a positive relationship between the UK and the EU after Brexit. And I am confident that the objectives I am setting out today are consistent with the needs of the EU and its Member States.

That is why our objectives include a proposed Free Trade Agreement between Britain and the European Union, and explicitly rule out membership of the EU’s Single Market. Because when the EU’s leaders say they believe the four freedoms of the Single Market are indivisible, we respect that position. When the 27 Member States say they want to continue their journey inside the European Union, we not only respect that fact but support it.

Because we do not want to undermine the Single Market, and we do not want to undermine the European Union. We want the EU to be a success and we want its remaining member states to prosper. And of course we want the same for Britain.

And the second reason I believe it is possible to reach a good deal is that the kind of agreement I have described today is the economically rational thing that both Britain and the EU should aim for. Because trade is not a zero sum game: more of it makes us all more prosperous. Free trade between Britain and the European Union means more trade, and more trade means more jobs and more wealth creation. The erection of new barriers to trade, meanwhile, means the reverse: less trade, fewer jobs, lower growth.

The third and final reason I believe we can come to the right agreement is that cooperation between Britain and the EU is needed not just when it comes to trade but when it comes to our security too.

Britain and France are Europe’s only two nuclear powers. We are the only two European countries with permanent seats on the United Nations Security Council. Britain’s armed forces are a crucial part of Europe’s collective defence.

And our intelligence capabilities – unique in Europe – have already saved countless lives in very many terrorist plots that have been thwarted in countries across our continent. After Brexit, Britain wants to be a good friend and neighbour in every way, and that includes defending the safety and security of all of our citizens.

So I believe the framework I have outlined today is in Britain’s interests. It is in Europe’s interests. And it is in the interests of the wider world.

But I must be clear. Britain wants to remain a good friend and neighbour to Europe. Yet I know there are some voices calling for a punitive deal that punishes Britain and discourages other countries from taking the same path.

That would be an act of calamitous self-harm for the countries of Europe. And it would not be the act of a friend.

Britain would not – indeed we could not – accept such an approach. And while I am confident that this scenario need never arise – while I am sure a positive agreement can be reached – I am equally clear that no deal for Britain is better than a bad deal for Britain.

Because we would still be able to trade with Europe. We would be free to strike trade deals across the world. And we would have the freedom to set the competitive tax rates and embrace the policies that would attract the world’s best companies and biggest investors to Britain. And – if we were excluded from accessing the Single Market – we would be free to change the basis of Britain’s economic model.

But for the EU, it would mean new barriers to trade with one of the biggest economies in the world. It would jeopardise investments in Britain by EU companies worth more than half a trillion pounds. It would mean a loss of access for European firms to the financial services of the City of London. It would risk exports from the EU to Britain worth around £290 billion every year. And it would disrupt the sophisticated and integrated supply chains upon which many EU companies rely.

Important sectors of the EU economy would also suffer. We are a crucial – profitable – export market for Europe’s automotive industry, as well as sectors including energy, food and drink, chemicals, pharmaceuticals, and agriculture. These sectors employ millions of people around Europe. And I do not believe that the EU’s leaders will seriously tell German exporters, French farmers, Spanish fishermen, the young unemployed of the Eurozone, and millions of others, that they want to make them poorer, just to punish Britain and make a political point.

For all these reasons – and because of our shared values and the spirit of goodwill that exists on both sides – I am confident that we will follow a better path. I am confident that a positive agreement can be reached.

It is right that the Government should prepare for every eventuality – but to do so in the knowledge that a constructive and optimistic approach to the negotiations to come is in the best interests of Europe and the best interests of Britain.

Conclusion

We do not approach these negotiations expecting failure, but anticipating success.

Because we are a great, global nation with so much to offer Europe and so much to offer the world.

One of the world’s largest and strongest economies. With the finest intelligence services, the bravest armed forces, the most effective hard and soft power, and friendships, partnerships and alliances in every continent.

And another thing that’s important. The essential ingredient of our success. The strength and support of 65 million people willing us to make it happen.

Because after all the division and discord, the country is coming together.

The referendum was divisive at times. And those divisions have taken time to heal.

But one of the reasons that Britain’s democracy has been such a success for so many years is that the strength of our identity as one nation, the respect we show to one another as fellow citizens, and the importance we attach to our institutions means that when a vote has been held we all respect the result. The victors have the responsibility to act magnanimously. The losers have the responsibility to respect the legitimacy of the outcome. And the country comes together.

And that is what we are seeing today. Business isn’t calling to reverse the result, but planning to make a success of it. The House of Commons has voted overwhelmingly for us to get on with it. And the overwhelming majority of people – however they voted – want us to get on with it too.

So that is what we will do.

Not merely forming a new partnership with Europe, but building a stronger, fairer, more Global Britain too.

And let that be the legacy of our time. The prize towards which we work. The destination at which we arrive once the negotiation is done.

And let us do it not for ourselves, but for those who follow. For the country’s children and grandchildren too.

So that when future generations look back at this time, they will judge us not only by the decision that we made, but by what we made of that decision.

They will see that we shaped them a brighter future.

They will know that we built them a better Britain.

Davos elites struggle for answers as Trump era dawns


January 16, 2017

Davos elites struggle for answers as Trump era dawns

By Noah Barkin

http://www.reuters.com/article/us-davos-meeting-preview-idUSKBN14Z07V

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DAVOS, Switzerland – The global economy is in better shape than it’s been in years. Stock markets are booming, oil prices are on the rise again and the risks of a rapid economic slowdown in China, a major source of concern a year ago, have eased.

“The state of global politics is worse than it’s been in a long time.At a time when we need more coordination to tackle issues like climate change and other systemic risks, we are getting more and more insular.”–Ian Goldin, Oxford University

And yet, as political leaders, CEOs and top bankers make their annual trek up the Swiss Alps to the World Economic Forum in Davos, the mood is anything but celebratory.

Beneath the veneer of optimism over the economic outlook lurks acute anxiety about an increasingly toxic political climate and a deep sense of uncertainty surrounding the U.S. presidency of Donald Trump, who will be inaugurated on the final day of the forum.

Last year, the consensus here was that Trump had no chance of being elected. His victory, less than half a year after Britain voted to leave the European Union, was a slap at the principles that elites in Davos have long held dear, from globalization and free trade to multilateralism.

Trump is the poster child for a new strain of populism that is spreading across the developed world and threatening the post-war liberal democratic order. With elections looming in the Netherlands, France, Germany, and possibly Italy, this year, the nervousness among Davos attendees is palpable.

“Regardless of how you view Trump and his positions, his election has led to a deep, deep sense of uncertainty and that will cast a long shadow over Davos,” said Jean-Marie Guehenno, CEO of International Crisis Group, a conflict resolution think-tank.

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Moises Naim of the Carnegie Endowment for International Peace was even more blunt: “There is a consensus that something huge is going on, global and in many respects unprecedented. But we don’t know what the causes are, nor how to deal with it.”

The titles of the discussion panels at the WEF, which runs from January, 17-20, evoke the unsettling new landscape. Among them are “Squeezed and Angry: How to Fix the Middle Class Crisis”, “Politics of Fear or Rebellion of the Forgotten?”, “Tolerance at the Tipping Point?” and “The Post-EU Era”.

The list of leaders attending this year is also telling. The star attraction will be Xi Jinping, the first Chinese President ever to attend Davos. His presence is being seen as a sign of Beijing’s growing weight in the world at a time when Trump is promising a more insular, “America first” approach and Europe is pre-occupied with its own troubles, from Brexit to terrorism.

British Prime Minister Theresa May, who has the thorny task of taking her country out of the EU, will also be there. But Germany’s Angela Merkel, a Davos regular whose reputation for steady, principled leadership would have fit well with the WEF’s main theme of “Responsive and Responsible Leadership”, will not.

‘Rejoicing in the Elevators’

Perhaps the central question in Davos, a four-day affair of panel discussions, lunches and cocktail parties that delve into subjects as diverse as terrorism, artificial intelligence and wellness, is whether leaders can agree on the root causes of public anger and begin to articulate a response.

A WEF report on global risks released before Davos highlighted “diminishing public trust in institutions” and noted that rebuilding faith in the political process and leaders would be a “difficult task”.

Guy Standing, the author of several books on the new “precariat”, a class of people who lack job security and reliable earnings, believes more people are coming around to the idea that free-market capitalism needs to be overhauled, including those that have benefited most from it.

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“The mainstream corporate types don’t want Trump and far-right authoritarians,” said Standing, who has been invited to Davos for the first time. “They want a sustainable global economy in which they can do business. More and more of them are sensible enough to realize that they have overreached.”

But Ian Bremmer, President of U.S.-based political risk consultancy Eurasia Group, is not so sure.

He recounted a recent trip to Goldman Sachs headquarters in New York where he saw bankers “rejoicing in the elevators” at the surge in stock markets and the prospect of tax cuts and deregulation under Trump. Both Goldman CEO Lloyd Blankfein and his JP Morgan counterpart Jamie Dimon will be in Davos.

“If you want to find people who are going to rally together and say capitalism is fundamentally broken, Davos is not the place to go,” Bremmer said.

Pace of Change

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Suma Chakrabarti, President of the European Bank for Reconstruction and Development (EBRD), believes a “modern version of globalization” is possible but acknowledges it will take time to emerge.

“It is going to be a long haul in persuading a lot of people who there is a different approach. But you don’t have to throw the baby out with the bath water,” he told Reuters.

Still, some attendees worry that the pace of technological change and the integrated, complex nature of the global economy have made it more difficult for leaders to shape and control events, let alone reconfigure the global system.

The global financial crisis of 2008/9 and the migrant crisis of 2015/16 exposed the impotence of politicians, deepening public disillusion and pushing people towards populists who offered simple explanations and solutions.

The problem, says Ian Goldin, an expert on globalization and development at the University of Oxford, is that on many of the most important issues, from climate change to financial regulation, only multilateral cooperation can deliver results. And this is precisely what the populists reject.

“The state of global politics is worse than it’s been in a long time,” said Goldin. “At a time when we need more coordination to tackle issues like climate change and other systemic risks, we are getting more and more insular.”

(Additional reporting by Ben Hirschler; Editing by Pravin Char)