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Wednesday, February 1st, 2023

The threat we can no longer ignore

This documentary focuses on the growing “wealth gap” in America.

Donald Trump, right, welcomes pro-Brexit British politician Nigel Farage, to speak at a campaign rally. Both leaders were pivotal in getting change in their countries. Farage pushed for Brexit, and Trump won the US election. Picture: AP

THE gap between rich and poor which helped propel the Brexit vote and Donald Trump’s presidential victory is likely to be the biggest driver in global affairs over the next 10 years, according to the World Economic Forum (WEF).

In its 12th annual Global Risks Report published ahead of its annual summit in the Swiss ski resort of Davis next week, the WEF surveyed 750 risk experts and found that “rising income and wealth disparity” would play a major part in world developments.

As an example of this growing inequality, the WEF highlighted the massive increases in CEO pay at a time when many people in advanced economies have struggled to make ends meet following the global financial crisis.

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Donald Trump, right, welcomes pro-Brexit British politician Nigel Farage, to speak at oone of his campaign rallies. Picture: APSource:AP

“This points to the need for reviving economic growth,” the report stated.

“But the growing mood of anti-establishment populism suggests we may have passed the stage where this alone would remedy fractures in society: reforming market capitalism must also be added to the agenda.

“The combination of economic inequality and political polarisation threatens to amplify global risks, fraying the social solidarity on which the legitimacy of our economic and political systems rests,” it added.

A campaigner for ‘Vote Leave’, from the official ‘Leave’ campaign organisation, holds a placard during a rally for ‘Britain Stronger in Europe’ in London before the Brexit vote. Picture: AFPSource:AFP

Other key drivers identified in the survey of the global risk landscape related to climate change, rising cyber dependency and an aging population.

WEF experts viewed with particular concern the weak recovery from the global economic crisis a decade ago that has left more people unemployed or underemployed.

Noting the electoral surprises of 2016 and emergence into the mainstream of parties stressing national sovereignty and traditional values across Europe and beyond, survey respondents also ranked increasing polarisation and intensifying national sentiment among the top five risks to the global economy.

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German Klaus Schwab, founder and president of the World Economic Forum, unveils the program for its annual meeting in Davos, Switzerland. Picture: Laurent Gillieron/Keystone via AP.Source:AP

As well as getting growth higher, the WEF identified several areas that need to be addressed urgently: the need for long-term thinking in capitalism; a recognition of the importance of identity and inclusiveness in political communities; mitigating the risks and exploiting the opportunities of new technologies such as driverless cars; and strengthening global co-operation.

The report also pointed to rapid changes in social attitudes that meant many voters were feeling left behind in their own countries, undermining social and political cohesion.

A Donald Trump supporter flexes his muscles with the words ‘Build The Wall’ written on them as Trump spoke at a campaign rally. Picture: ASource:AP

“Years of building pressure in many parts of the world, at least since the global financial crisis, crystallised into dramatic political results during 2016 as public disaffection with the status quo gained traction,” the report said, pointing to Britain’s vote to leave the European Union and the election of political outsider Donald Trump as US president.

US President-elect Donald Trump accompanied by family members and Vice President-elect Mike Pence have turned the tide of international politics. Picture: APSource:AP

It added that a failure to address the underlying causes of the populist tide poses a threat to mainstream politicians and raises the risk that the globalisation trend will go into reverse.

“Some people question whether the West has reached a tipping point and might now embark on a period of deglobalisation,” it said.

Although anti-establishment politics have tended to blame globalisation for the loss of traditional jobs, the WEF said rapidly changing technologies have had more of an impact on labour markets.

The Alpine resort of Davos where the annual meeting of the World Economic Forum will take place from 17 to 20. Picture: Fabrice Coffrini.Source:AFP

“It is no coincidence that challenges to social cohesion and policymakers’ legitimacy are coinciding with a highly disruptive phase of technological change,” the WEF said.

WEF founder and executive chairman Klaus Schwab told AFP earlier this week he hoped this year’s gathering could brainstorm about how to address “the root causes” of the widespread anxiety seen in the world today and answer the question “why the people are angry, and why they are not satisfied.”

The 2017 report, the 12th annual report, is based on an assessment of 30 global risks by 750 experts from a variety of backgrounds, including business, academia and non-governmental organizations.