Wednesday, April 30, 2008

Superclass: These men rule the world...

From excerpt:

The iconic symbol of superclass unity is the Gulfstream private jet. In fact, one way to measure the clout of an event is to count the private jets at the nearest airport. According to Gulfstream, Davos traditionally attracts more of its planes than any other gathering, drawing up to 10 percent of the 1,500 planes in service to Zurich airport. But this year's Olympics in Beijing will give it a run for its money, as typically do events as diverse as the Monaco Grand Prix, China's Boao Forum, the Geneva Auto Show or Allen & Co.'s annual getaway for media magnates in Sun Valley, Idaho.
Globalization looks different when you can tell the pilot when to leave and where to go, and when there are no security lines to wait in when you are heading off for distant destinations. Those who are free to move about the planet this way come to have more in common with themselves than with their own countrymen. "What happened to us, that we walk through the Davos party and know more people than when we were walking across the village green in the town we live in?" wonders Mark Malloch-Brown, former Deputy Secretary General at the United Nations and now a senior official in the British Foreign Ministry. In fact, Davos is a village green for the superclass. It's at such a gathering that leaders get to know one another, hatch deals and exercise perhaps the greatest power the superclass has collectively: to shape conventional wisdom.

In these conclaves, priorities are not only for their own constituencies, but for entire regions and the world at large. Possibly the premier gathering in Latin America is the "Fathers and Sons" event held annually by the world's richest man, Mexican telecom magnate Carlos Slim, who presides over groups of Latin American corporate giants and their scions. The telecom billionaire pays for the entire event himself and orchestrates the schedule, which according to recent participants is "quite work intensive" but includes some time for tennis, golf, even, on one occasion and despite the absence of women, dancing among the fathers and sons when the music went on at the end of the day. The Slim event illustrates the importance to the heirs of Latin America's traditional elite culture of connecting across borders, of forging international alliances within the subset of the global superclass with whom they have the most in common.

Thanks to this kind of social interaction, large portions of the global superclass are well acquainted with each other. Says Stephen Schwarzman, CEO of Wall Street's Blackstone Group, "The world is pretty small. In almost every one of the areas in which I am dealing or in which we at Blackstone are looking at deals, you find it is just 20, 30 or 50 people worldwide who drive the industry or the sector." Numbers tell the same tale. If you take just the people who serve in top management positions or on the boards of the five biggest companies in the world, you'll find they also serve on the boards of an additional 140 other major companies and 22 universities. To Schwarzman, being a member of the superclass means being able to "get to anybody in the world with one phone call."

These kinds of connections can work to stabilize the world in a crisis. But not necessarily. I once overheard a dinner conversation among the CEO of a leading aircraft manufacturer and a senior member of the U.S. House Armed Services Committee. "Here's the deal," said the CEO. "I want to sell a plane to Muammar Kaddafi and he wants to buy one. But we have sanctions in place that won't let me sell to him. The U.S. wants this guy dead. So, what I'm thinking is, if you help me get the OK to sell him the plane, I'll build with explosive bolts connecting the wings to the fuselage. Then, one day he's up flying over the Med and we push a button. He's gone. I make my sale. Everyone's happy." Fortunately, the conversation took place in the 1990s, a time before U.S. foreign-policy makers began bending international laws to achieve national security goals. The congressperson declined the offer.

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