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Lessons from Davos

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Kevin P Riley
February 10, 2019

The World Economic Forum held in Davos, Switzerland each year is typically characterized as a meeting of the world’s movers and shakers in banking, multinational finance and securities markets. You could rightfully ask, “What possible lessons could public administrators ever learn from the world’s movers and shakers, flying in on more private and corporate jets than you can count?”

Well you can count the jets–there were almost 1,500. And we can learn lessons too. There were some interesting themes from Davos’ press coverage. Many of these themes will need to be considered by public administrators in directing and shaping future public policy.

Global climate change

Sir David Attenborough’s reminder to a packed Davos auditorium that, “Every breath we take, every mouthful of food we eat, comes from the natural world. If we damage the natural world, we damage ourselves,” was the most direct statement about the very real risks we face by not addressing global climate change. In interviewing Attenborough, Prince William, the Duke of Cambridge, brought out the connection between environmental protection and economic success and the growing importance of the environment to business leaders.

A World Economic Forum survey of business leaders put environmental concerns and global warming highest on their list of risks facing the world. The top risk by likelihood was extreme weather, while failure by governments to limit the magnitude of climate change was in second place.

As public administrators, if we fail to address the impacts of global climate change, we are very likely to fail to respond to the number one public policy challenge of our time. And like many aspects of complex public policy, climate change directly affects a range of subsidiary issues:

  • Energy generation and distribution.
  • Agricultural research and production.
  • Health and wellbeing.
  • Water supply and management.

The Lowy Institute, an Australian think tank, reported in their 2018 Lowy Institute Pollthat 59 percent of Australians say, “global warming is a serious and pressing problem.” They agreed, “We should begin taking steps now even if this involves significant costs.”

Inequality, distrust, and populism

The founder of the world’s largest hedge fund revealed at Davos what scares him the most about the state of the global economy. Ray Dalio included in his list:

  • Growing inequality.
  • Growing distrust of institutions and more populist policies.

With interest rates still at historically low levels, financial assets have increased in value faster than normal in the last decade. Those lucky enough to already have financial assets have benefited. Those without look on and wonder how, and why, they have missed out.

In Australia, after 27 years of continuous economic growth, many feel they have not gained anything. Only 5 percent of Australians surveyed by the Committee for Economic Development of Australia believed they have gained “a lot.”

Growing income inequality produces distrust in the system. Increasing numbers of citizens believe the economic system only works for elites. This leads to calls for more populist policies that attempt to address complex social and economic conditions with slogans like, “Stop migration,” “Impose tariffs,” and “Tax the rich.”

Not only is there distrust in the economic system, but there is increasingly distrust in liberal democratic systems of government too. According to the Edelman Trust Barometer, governments are now the least trusted institution in the world.

The same 2018 Lowy Institute Poll mentioned earlier reported that only slightly less than half of Australians aged under 45 agreed that, “Democracy is preferable to any other kind of government.” One must wonder if those surveyed would prefer a more authoritarian form of government. If so, is that due to the perceived inability of today’s democratic governments to address the issues that are important to citizens?

Lesson we must learn and act on

With these challenges, what must we learn and how must we act?

The core values we demonstrate as we engage with citizens, communities and business will be central to how we respond. Core values that must underpin our role include:

  • Respect for the rule of law.
  • Equality for all before the law.
  • Respect for the individual.
  • Freedom of speech.
  • Tolerance of diverse or dissenting views.

Clearly citizens and businesses have concerns about governments’ responses to global climate change. If we cannot address the policy directly, we should ensure that every major public policy response includes analysis of that policy’s impact on climate change. Without this we are failing to:

  • Address the real and present concerns of citizens, communities and business.
  • Fully consider the interconnected nature of this wicked policy dilemma because when it comes to global climate change, all things are interconnected.

We can enhance the level of trust and reduce the perceived influence of vested interests in public policy making by:

  • Being the repository of institutional knowledge and public policy capacity, collected and curated over time.
  • Engaging broadly and seeking out diverse stakeholder views to support inclusive, respectful, and rational debate about the public policy challenges we face.
  • Making the public policy development process more transparent and more clearly focused on evidence and expertise.

Author:Kevin P Riley is the Managing Partner of GPA Partners, a Canberra based firm advising on governance, performance and accountability matters. Kevin was born in Warwick, R.I. and continues to follow U.S. governance arrangements closely. Kevin is a Fellow with both CAANZ and CPA Australia and is a Qualified Accountant with the UK based CIPFA. Kevin is a National Councillor of the Institute of Public Administration Australia Inc. Kevin can be contacted by email at [email protected].

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