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The Davos elite worry about inequality - but don't expect them to act

Turkeys won't vote for Christmas and Google won’t vote to pay its taxes either.

David Cameron answers questions after his address to The World Economic Forum in Davos earlier today. Photograph: Getty Images.

This week saw energy giant SSE announce a 8.8 per cent hike in profits, to £1.5bn. For its millions of customers who faced a price increase of 8.2 per cent just two months ago, what better demonstration could there be of the broken nature of our energy market? What better example of untrammelled corporate rent-seeking than SSE’s well paid executives and shareholders receiving bumper payouts, while millions of customers struggle to pay bills that only ever go up, not down?

This show of corporate power is currently on display on a bigger scale in Davos, and surely energy customers in Britain won’t fail to spot the irony of the Masters of the Universe, gathered on their Swiss mountaintop, deciding that income inequality is the greatest threat we face today. How apt that these standard bearers for the wealthiest 1 per cent should choose their annual convention for Corporate Boosterism to wake up to the iniquity of our gross, global inequity. And fitting, too, that it should be at Davos, where Thomas Mann imagined the products of an earlier, gilded age of capital and reflected on the sickness of their modernity, and the conflict that hung over it.

But hold the hollow laughter for a moment, because the sight of plutocrats wringing their hands ought to be a wake up to politics and the people we represent. They are right to worry that the accelerating accumulation of wealth and power in ever fewer hands is fuelling instability between nations and hardening divisions within them. When those divides can be captured as graphically as Oxfam did this week with the news that the richest 85 people now control more cash and assets than fully half the population of the globe, they are right to be profoundly concerned. A risk index of 85:3.5 billion doesn’t look good on the balance sheet, you see. But the trouble is that the answers to this problem can’t be found on any balance sheet, or with the accountant’s slide-rule. No matter how hard they look, the answer won’t be found by these cosmopolitan capitalists on their magic mountaintop. No, the answer lies with the people looking up from the global valley floor below, and in a politics that speaks for them once more.

Now, perhaps I'm writing them off too soon. Perhaps the modestly-titled World Economic Forum will conclude this weekend with a communique calling for redistribution of wealth from rich to poor? Perhaps they'll propose tax transparency, country by country profit reporting and statutory tax co-ordination between sovereign nation states? Perhaps they'll champion the role of state investment and public research in underpinning private enterprise? Perhaps they'll back a Living Wage, a Tobin tax, trade union membership or call for the return of Glass-Steagall legislation at home and capital controls abroad? Perhaps they'll suggest some means to reverse the relentless acquisition of more by those that have the most? Perhaps. But I doubt it.   

They should, of course, because they are right to be worried that the yawning gulf in wealth and opportunity, across generations, and between class and caste, will jeopardise not just the life chances for billions of our global citizens, but, eventually, their own business model, too. However, they cannot articulate the right prescription because the solutions required are anathema to their merchant code. They limit the flexibility to hire and fire as business needs demand. They constrain the capacity to place shareholder gains and quarterly returns above all else. They raise other values of loyalty and local pride, solidarity and long-term commitment, alongside the purity of the profit-motive, and so dilute its power. They ask rootless and ruthless global markets to accept that there exist social and public goods that should never be commoditised, and local rules that should not be subverted. They ask money to acknowledge that there are spheres of life where it should hold no sway. 

Don't hold your breath. Turkeys won't vote for Christmas and Google won’t vote to pay its taxes either. The only answer is a politics which takes on vested interest and bends it to the people’s will. A politics that takes on the energy companies that are ripping us off, that challenges the banks to serve industry and not themselves, and one that chooses to prioritise the hard-working majority, not protect a privileged minority.

That’s not a politics or a morality that you are likely to find in the rarefied air of Davos's smoke-free seminar rooms or in Tory Party HQ. But it is the politics that we need here in Britain and that we need to project from our small island to the globalised world beyond. It’s a One Nation Labour politics. And Ed Miliband will deliver it when he wins power for the people in 2015.