Caleb Zakrin (6:36)

Yeah, I think it's. It's interesting how much the pandemic started to reveal or, you know, really showed some of these characters like Schwarzman and Fink, and how they came to the fore in a way that I had not really known who they were until the pandemic when they became these major players. And in your book, you focus on several people in particular that are for you, the kind of archetypal Davos men. And I was wondering, why did you call your book Davos Man? And what is a Davos Man? And who are some of the main characters?

Peter S. Goodman (7:13)

Yeah, that's a really important question. So Davos man is this term coined by the political scientist Samuel Huntington back in 2004, and he was using it loosely to refer to people who attend the World Economic Forum, this glittering gathering of heads of state, billionaires, the odd celebrity, famous academics in the Swiss Alps village of Davos every January. He was referring to the tribe of billionaires whose fortunes are so complex and vast that they spread across jurisdictions. So they don't really have allegiance to any particular country, any tradition, any ideology. They're. They're just beholden to the bottom line. I've come to use it to differentiate this particular species of human from the rest of humanity. It's the billionaire class that would have us believe, and that has quite successfully gotten us to believe that their success is our success. That when we organize our economies around sending more wealth to the people who already have most of it, we somehow all win. And that if we interfere with their wealth, our prosperity collectively is threatened. And we've been living in a half century era during which that idea has had central currency in our policy making. And so I wanted to understand, what sorts of stories does Davos man tell himself to justify this really quite absurd idea? I mean, I spent a lot of time delineating what I refer to in the book as the cosmic lie, which is essentially trickle down economics, and the belief that tax Cuts and deregulations, which always overwhelmingly benefit wealthiest people and shareholders, somehow benefit everyone else. Something that is in reality happened zero times. And I wanted to try, to the best of my abilities, to kind of get inside the minds of the billionaire class and understand, is this just public relations? Are these narratives that these guys really believe? And I realized that I couldn't just write about Davos man as this sort of composite of the billionaire class. That wouldn't be a very satisfying book and it wouldn't get us anywhere in terms of understanding the psychology involved. I needed to pick some characters I could follow and I could have picked other characters. There are many Davos men, not in my book, who could have told the story just as effectively. But, you know, I had watched over the years, Mark Benioff, who's. Because I'd been to Davos something like nine times. And Marc Benioff is a member of the board of trustees. He's the CEO of a big Silicon Valley tech company called Salesforce. And Benioff quite famously said while I was in the midst of doing the research for my book, this is at virtual Davos in 2021. He says CEOs are the real heroes of the pandemic. I mean, think about that. Not frontline medical workers, not the people delivering our food or working in slaughterhouses or emptying bedpants in senior citizens homes. No, CEOs are the heroes of the pandemic. And he goes on to say, you know, we delivered vaccines and credit to stave off bankruptcies. Government didn't save you, he says, non governmental organizations didn't save you. We saved you. And not for profit, but just to save the world. And, you know, that is just a remarkable worldview that I think personifies this whole ideology that I'm interested in excavating and bringing to light for the lay reader. But, you know, initially I wasn't so much focused on, on the forum as more than a kind of way into the book. I thought back as, as I was plotting out how to explore the nexus of inequality with right wing populism with this Davos I had attended in January of 2017. So this is, you know, six months into Brexit, Trump's about to be inaugurated, and the people at the World Economic Forum are at least paying lip service to this idea that something has really gone wrong with the whole, you know, liberal democratic order is the future of human civilization. We better figure out what's going on. Oh, inequality is really a problem. There are problems with faith in corporate governance. There's Just a disconnect between the elites and ordinary people. Let's look into that. And so there were all these earnest panel discussions. Sheryl Sandberg was there leading a discussion on how to better humanity. I mean, let's remember the World Economic Forum. It, it unspools under this banner of committed to improving the state of the world, which is this incredible mantra for an organization that is dominated by people who are by any measure the, the ultimate beneficiaries of the status quo. So I decided that this is January 2017, to wander around going to these panel discussions to see what does Davos man have on offer as a way to solve inequality. And what I found was people like Ray Dalio, a hedge funder then worth about $18 billion, said, what we need to do is deregulate further. There needs to be more tax cuts to create a more conducive atmosphere for the making of money. Which was quite an interesting thing to hear from someone who, despite this apparent scarcity of ways to make money, had managed to accumulate $18 billion. I listened to my former boss, Arianna Huffington, who had just launched this wellness website that was dedicated to vacuuming up sponsorships from spa resorts and skin cream companies, say that the answer to inequality was more comfortable pillows, meditation and more sleep. I listened to the head of a large Indian consulting company say that workers had to take more responsibility for their skills and they had to train themselves. Like, I basically heard everything except for those of us who are here who have most of the money need to figure out how to share some of it with the other 8 billion plus inhabitants, or 8 billion give or take inhabitants of planet Earth. And that was not by accident. The whole central operating principle of Davos is that every problem has a win win solution, which is a handy way of saying that no one has to sacrifice. And by the way, we're all the good guys. And because we're the good guys, the more money we have, the more good we can do. And I realized that that was a perfect way into a book about inequality and this bottom up transfer of wealth, because it hadn't happened by accident. I mean, this is not some sort of puppeteer conspiracy. This is all stuff that's happened in plain view. But the billionaire class has, over half a century, unleashed lobbyists, tax accountants and lawyers to shape our economies in the wealthy countries of the world in their interest. And that's what my book really had to be about. But, but to understand that in a satisfying way, I needed to dive into the actual machinations of individual people So I settle on Benioff. Steve Schwarzman, the world's largest private equity magnate. Larry Fink, who is the world's largest asset manager. This is a guy who founded BlackRock, a company that now manages $10 trillion in investment. Jamie Dimon, who's the CEO of JP Morgan Chase, America's largest bank. And of course, Jeff Bezos, who needs.

Caleb Zakrin (14:59)

No introduction at the beginning of the book. When you're first laying out Davos, you talk about Davos founder Klaus Schwab. And Schwab seems in many ways, especially with his influence on Benioff, to be the kind of architect of this ideology that you take to task.

Peter S. Goodman (15:19)

So I was wondering if you could.

Caleb Zakrin (15:20)

Talk about Schwab and his beliefs and his influence on the attendees of Davos.

Peter S. Goodman (15:28)

Yeah, well, Schwab is a, is an ideal Davos man, because if you ask about his values, you know, they're, they're sort of unobjectionable. This is a guy who believes in public private partnerships. He believes in social democracy. He believes in European integration and social safety nets and progressive taxation. He thinks we should tackle climate change and deal with the fact that automation is threatening employment. We got to figure out how to, how to make labor more secure. I mean, if you ask him individual questions about issues, you get a sort of classic European steeped in American management theories of his generation. I mean, he's an economist who speaks in this kind of farces, farcically thick German accent. He's the subject of some ridicule for his ego amongst the people who work for him. He goes around telling people that he's going to win a Nobel Peace Prize one day. He gets very upset if he is not treated as a visiting head of state when he goes to visit other countries. But this is a guy who has on the strength of this idea that, like, we can solve the world's problems by gathering the most powerful people on top of a mountain in Switzerland, built a highly lucrative enterprise. On paper, the World Economic Forum is a nonprofit. In reality, he and his wife Hilda Schwab, the co founder, have dipped their beak quite generously into the river of money flowing through the World Economic Forum. And you know, I detail in the, in the book how at one point in the 90s, as Schwab spending a lot of time with people like Bezos and wanting some of the money that they're accustomed to, he sends his nephew Hans off to Boston to go and run video conferencing software thinking of Zoom 20 years earlier. And he stakes it with money from the Nonprofit World Economic Forum. And Klaus Schwab builds out the technology. He builds partnerships with very large tech companies, including Microsoft. And eventually he flips this startup to a publicly traded company called US Web Corp. And turns a $5 million stake into something like $20 million. And on the eve of the sale of this startup to U.S. web Corp. Klaus Schwab, the founder of the Forum, calls up his nephew and says, hey, you know, one little wrinkle. These, the proceeds of the sale, they need to go to a whole new place, this new foundation that his nephew had never heard of because it had just come into being. And this was the Klaus and Hilda Schwab foundation for Social Entrepreneurship, which, you know, under Swiss law is basically like a black box. Like they put out a replacement report that says they're using the proceeds to drill wells in, in Africa and promote the inclusion of Pakistani girls in public education. But you know, we're just taking it on their say so that that's how it operates. And the signs of how the Forum operates on the surface, from what we can see, are disconcerting. I mean, Schwab has tapped Forum funds to, to spend something like US$70 million to purchase parcels of land that have made contiguous his home in the Colony section of Geneva. This is like the Beverly Hills of Geneva, right on Lake Geneva, and the Forum headquarters next door. The Forum headquarters is really extravagant. It's lined with photos of Schwab entertaining heads of state. Most nights there's a banquet at, at his residence, all paid for by the Forum for some visiting dignitary. And it's created, you know, quite a nice life for himself. And along the way, Schwab has deviated from the values of the Forum itself in quite pronounced ways. I mean, I've already told you about how he handled this profit making venture, but, you know, in addition, he's essentially building this go to global networking spot. And this is his real genius, by the way. Like, he understood that the world was already full of just conventional business conferences where business people could get together under the banner of Forbes or Fortune or whatever and talk about how to make more money. He, by adopting this mantra, committed to improving the state of the world, turned Davos into this place where anyone who was a participant was by definition committed to improving the state of the world. They were the good guys. It became this kind of virtue signaling place. And so there's this public facing, earnest set of panel discussions on climate change and racial and gender inequality and the future of work and, you know, all the sorts of things that One might expect. But what's really going on is Schwab has gotten all these companies to use their participation in the forum to signal their virtues and to pay hundreds of thousands of dollars a year in memberships for exclusive access to one another. So, like most of us ordinary people go to Davos, we wander around to these panel discussions. The cool kids, the ones who are actually paying the bills, the CEOs of tech companies, of global consulting firms, of global banks. They will actually tell you, you know, as a mark of sophistication, that they never go to any of those panel discussions. I mean, maybe they go inside to, like, go engage in the. I'm not making this up simulation of the Syrian refugee experience. You know, this was running for a couple of years, where they'll submit to being blindfolded and led around in the dark while someone's hollering at them, demanding papers in a language that they don't understand. And. And then they'll congratulate one another for the display of empathy and then go back outside to attend a banquet underwritten by HSBC where they'll, you know, drink champagne and eat white truffles. But by and large, what they do is they go to these exclusive lounges that they get access to by dint of paying these membership fees. And Klaus Schwab plays matchmaker. He will, you know, make sure that. That the head of a Middle Eastern oil company or a monarch who controls access to oil assets can meet in secret with the CEO of a European fossil fuel company without regulators knowing about it, without annoying journalists or human rights advocates or. Or anybody. It's just sort of off balance sheet. And because the wealthy, powerful people know that this is what's going on, they can do a lot of business in the space of a few days. I mean, I've had CEOs tell me, you know, what would normally take me months to schedule. In four days, I can. I can have 25 meetings and just do. Do all of this business. And so that's what's really happening. That's how it's. It's lucrative for the Schwab's. And at the same time, Schwab gets all these powerful people to come by laundering their legitimacy. I mean, the last time Trump showed up, this was right after handing out a $1.5 trillion package of tax cuts, in part because of the lobbying of people like Jamie Dimon, then heading the business roundtable with the proceeds lavished on people like Jamie Dimon. Schwab actually, at the lectern, said, thank you so much, Mr. President, for attending. We know that your leadership is subject to many misunderstandings to so it's good to hear from you personally. And then he praised Trump for being a beacon of inclusivity, for making the US Economy more inclusive. He praised Narendra Modi, the Indian Hindu supremacist leader, within a month of a member of his party offering a million dollars for a bounty on the head of a Bollywood director who had offended, apparently some Hindu legend. Schwab praised Modi for his commitment to diversity. He the year that I was telling you about before, in 2017, the lead character was Xi Jinping. And Schwab essentially said, your people have entrusted you with leadership. And much of the audience is sitting there saying, oh, we, we, we missed the part where there was an election in China that elevated Xi Jinping. So essentially he will say whatever needs to be said to ensure that powerful people continue to show up. And that's the real M.O. of the forum. And it offers a kind of laundering of legitimacy to its participants as well. And I'll just tell you one final forum story. I remember years ago there was a panel discussion. There's a bunch of pharmaceutical company executives, including, you know, Gilead. This is a story I detail in the book, which at that point had, you know, really just, just quite brazenly profiteered on drugs for people suffering from hiv. And they have this earnest panel discussion around, you know, the unaffordability of drug prices. You know, what's the source of this? And, and this CNBC moderator went around the table, what do you think? You know what, why are drug prices so unaffordable? Committed to improving the state of the world. Everyone at the table must be on the side of good. And so they all said, well, you know, maybe we haven't realized the right models yet. We need multi stakeholder dialogues to get to the bottom of this. I mean, it's this open invitation to for anyone present to take the stance that they're on the side of human progress.

Caleb Zakrin (25:35)

Something you just mentioned at the end, something that you provide a very interesting discussion of is stakeholder capitalism. And stakeholder capitalism is sort of this new model of capitalism that isn't all just about shareholders and the sort of Milton Friedman model. And I was wondering if you could talk a little bit about this notion of stakeholder capitalism and its significance to the Davos men and sort of your take on what it actually is.

Peter S. Goodman (26:06)

Yeah, yeah, that's a super important question. So stakeholder capitalism is this term that I think Klaus Schwab actually invented back in the 70s. He's written books about stakeholder capitalism. It is supposed to be this kinder, gentler form of capitalism, but it's gotten real currency in recent years thanks to people like Marc Benioff and, and Larry Fink and Jamie Dimon, who, when he was running the Business Roundtable back in the summer of 2019, got 181 CEOs to actually sign off on this statement of a purpose of a corporation that disowned Milton Friedmanism and this idea that if companies were just managed to maximize profits for shareholders, society would somehow get the benefits of that. They, they set that aside. They said, that era is over now. Now we're catering to stakeholders. And stakeholders include labor, Never labor unions. That's not a term that we see thrown around or labor movements, but labor and local communities and social concerns and the environment. At one point, Benioff actually went on a Jim Cramer show, Mad Money and pronounced that the planet is a stakeholder, which is very reassuring news for those of us who live on the planet. And it's clear that stakeholder capitalism, I argue in the book, is this new way of the billionaire class protecting itself from the exercise of real stakeholderism. I mean, I think we should just get rid of that horrible term. But what would real stakeholderism look like? It would look like democracy, who would look like human beings exercising their democratic rights to have a say over things like progressive taxation and antitrust enforcement. So we're not just subject to monopoly powers and rules that make it possible for labor to actually collectively organize around getting their piece of the pie. And stakeholder capitalism is a way of preempting all of that. And as I argue in the book, the pandemic is very the ultimate test of the principles of stakeholder capitalism. And the billionaire class failed that test miserably. I mean, for openers, the Business Roundtable appoints as the head of a COVID 19 task force the late Arnie Sorensen, who was then the CEO of Marriott, the world's largest hotel chain. And Arne Sorensen gets a lot of attention for this supposedly heroic trot in front of the cameras that to announce in March of 2020 that he's just so incredibly sorry that he has to lay off 75% of his workforce in the United States, threatening their health care in the middle of a pandemic. And in a gesture of solidarity, I mean, this is the guy who's running the COVID 19 task force for the Business Roundtable, supposedly now governed by Stakeholder capitalism. But in this act of solidarity, he's going to give up his salary for the year, which is something like, if memory serves, $1.3 million doesn't say anything about his $8 million in stock based compensation. And a couple weeks later, Marriott goes ahead and hands out several million dollars in dividends to shareholders, enough to have financed wages continuing for all of those workers for many months. And so all we need to do is look at the fact that Jeff Bezos signs the Business Roundtable Statement of a Purpose of a Corporation and then allows his warehouse workers to continue to work in his warehouses without protection. During the worst phase of the pandemic, when there's a labor uprising at a warehouse, most prominently In Staten Island, New York in March 2020, the leader of that movement, a guy named Christian Smalls, who I talked to in the book, is actually fired for supposedly violating quarantine, which quarantine, which is really ironic given that he really wants everyone to be quarantined, but he wants people to have paid sick leave. And Amazon, of course, has lobbied over years to prevent federal paid sick leave policies. And even when the Democrats force something through in the midst of the pandemic, it has so many loopholes that it doesn't affect most of the American workforce. Again, not by accident, because of the lobbying of Davos man, Albert Bourla, the CEO of Pfizer, signs the Statement of a Purpose of a corporation and then takes Covid vaccines, pioneered with the help of a lot of publicly financed research, and sells them around the world to the highest bidder, such that if you're lucky enough to live in a wealthy country like the United States or the UK or Japan, you've got protection. And most of humanity is shut out. Which means that we get not only the humanitarian catastrophe of doctors in places like West Africa, South Asia, continuing to treat COVID patients without any protection, but the result of this humanitarian catastrophe is that we're vulnerable to variants like Delta and Omicron. So even in wealthy countries, we are subsidizing the monopoly profits for shareholders of Pfizer through the perpetuation of our pandemic. We are paying through our shuttered schools and the disruption of our children's education, through fear, through death, through continued hits to our livelihood, so that Albert Borla, who signed the Statement of a Purpose of a Corporation, can continue to basically just sell off these vaccines to the highest bidder. And finally, Larry Fink, who's probably the loudest celebrant of stakeholder capitalism, signs the statement of a purpose of a corporation, and then goes everywhere declaring that Covid is bringing home that this is a whole new era and that corporations get it and we can count on CEOs to take care of our problems quietly. This is a story I detail in the book. He turns the screws very personally on. On Argentina in the midst of the pandemic, at a time when they're seeing their healthcare systems overrun, when poverty's on the rise. He turns the screws to get pennies on the dollar extra in a settlement on the bonds that BlackRock has bought into. And this is bigger than Argentina. Fink understands that there are huge numbers of countries throughout the developing world whose finances have been ravaged by the pandemic. They're going to have a hard, hard time making good on their debt payments. And he clearly wants to send a signal to anybody else around the world that nobody stiffs Davos man. And as a result of that, despite his pledge to society, to local communities, to the public interest, we have a situation where countries from Africa to South Asia are actually cutting their healthcare spending. They're cutting their social safety nets to prioritize debt payments to financial centers like New York, Frankfurt, Beijing, and in large part because people like Larry Fink turn the screws. So we ought to dismiss any notion that stakeholder capitalism is real and that. And we should see it for what it is. It's an elaborate public relations contrivance that's designed to convince us that the billionaires have got this. We don't have to menace them with nuisances like taxes and regulations and antitrust enforcement. We can just outsource our problems to them.

Caleb Zakrin (33:56)

Do you think that we would be better off if they just dropped the stakeholder capitalism label and just embraced Milton Friedman's sort of idea that, you know, the shareholder is. Is right and we should do everything that we can to benefit the shareholder? Would that, would that at least be honest or is at least stakeholder capitalism? You know, there's some. Some good elements maybe that have come from it.

Peter S. Goodman (34:20)

I mean, look, if a company wants to organize itself to do right, that's great. I mean, my book's not about demonizing companies or, or demonizing billionaire CEOs. I mean, CEOs ought to treat their employees well. They ought to care about their local communities. If they do, that's great, but we can't count on it. I mean, we can't stand down as democratic societies and just put our faith in the goodness of the people who have most of the money. That's just A sucker's game. So, yeah, I think we would be better served by forgetting about stakeholder capitalism as this sort of broad declaration to organize around, because we're just going to end up in these kind of tedious, nebulous debates about standards, when what we should be doing is demanding transparency and demanding policies that are under the control of democratic governance, like progressive taxation and rules that give labor unions a shot at organizing toward their own interests. I mean, the thing about stakeholder capitalism is it's always unilateral. You know, it's always like, you know, look at us being so generous and, and good. And it's always like, wrapped up in this whole narrative that deflects attention from what's really going on. I mean, I mean, Benioff, you know, will tell you he lays out the story in his memoir that, you know, his whole idea for Salesforce came to him when he took this trip to southern India when he was having this existential crisis early in his career. And he. He met a woman he calls the hugging saint, who in an incense filled room, embraced him and told him that the true meaning of his life was to amass a fortune and then figure out how to give back to society. And this, he says, was his inspiration for his philanthropy, for ensuring that Salesforce contributes 1% of its revenues and 1% of its staff time for philanthropic efforts. Hey, that's great. You know, that's. That's all good, but it doesn't amount to anything alongside the modest sum of zero that Salesforce has paid to the federal government in taxes a couple of times in recent years. And again, not by accident, because Benioff celebrated Trump's tax cuts, because Benioff is part of the Business Roundtable and the US Chamber of Commerce. And these are lobby shops that are designed to make sure that people like Marc Benioff get to hang on to most of his fortune.

Caleb Zakrin (36:54)

So.

Peter S. Goodman (36:55)

So any device that muddies the waters of what's really going on, even if some good may come from it, is contributing to our overall confusion about what needs to happen. And we need to set aside this idea that the billionaires are going to save us.

Caleb Zakrin (37:13)

There's a term that many people typically, I think, used to describe the Davos man ideology. Neoliberalism. And neoliberalism doesn't appear as a concept in your book. Is there a reason why you chose not to use that term?

Peter S. Goodman (37:29)

Yeah, because Davos man will depart from neoliberalism the minute that it's in his interest. I mean, Davos man is all for rugged individualism and free markets, when he has monopoly power and the ability to write the rules in his favor, and, and when his assets are threatened by a financial crisis or a pandemic or whatever, and there's free money to be had from the government, Davos man is all for that, then Davos man is for welfare capitalism. So, I mean, neoliberalism is really important and it's been one of the tools in Davos Mann's toolkit. I mean, I do lay out in the book the significance of, of, of Robert Bork, who comes out of the Chicago School, who turns what had been this really fringe idea into a mainstream idea in the school of antitrust, which is, you know, this concept that if consumers are not damaged by a merger immediately, then the government should just get out of the way and let any two companies team up and consolidate and get bigger. And this clearly does not work in a time when many companies are giving their products away for free. I mean, where's the consumer harm if Facebook and Google are letting us use their services for free? Or where's the consumer harm if Amazon can at least initially undercut all competitors and give us lower priced goods, setting us up for predatory pricing, or in the case of Google and Facebook, setting us up for, you know, a domination of, of the online advertising market for vacuuming up our data in ways that are clearly systemically harmful. And so, you know, this, this is, this clearly comes out of the Chicago school. And Davos man has engaged in proliferating these neoliberal concepts through think tanks, through the helpful work of access journalists who don't tend to scrutinize the details of his operations that carefully and through, of course, his lobby shops. But, but I feel like, you know, to call Davos Man a neoliberal is to at least credit him for some kind of ideologically consistent position, when in fact what we see time and again is Davos man is for whatever in the moment leads to more tax cuts, more deregulation, and more potential public rescues in the moment of crisis.

Caleb Zakrin (40:02)

Yeah, I think you demonstrate that really well, especially, you know, in the way in which the Davos men treat Trump when he visits. And there's a particularly interesting section of the book where you talk about how Stephen Schwarzman was leading Trump around Davos and basically trying to convince everyone that Trump's not actually racist, he doesn't actually have these nativist views. And I was wondering if you could talk a little bit about Schwarzman and specifically how Schwarzman has, you know, through his dealing, wheeling and dealing consolidated a lot of power in the healthcare sector. And some of the immediate negative impacts that were especially felt in the pandemic as a result of this.

Peter S. Goodman (40:46)

Sure, yeah. So, I mean, Schwarzman is the key Davos man in terms of understanding Trump, because Schwarzman is a Trump apologist, you know, right up until January 6th. I mean, Schwarzman, even after the election, even after the other Davos men have broken, you know, is still defending Trump's right to contest the election results and to drag out the results, you know, through the court system. You know, I'm glad you noticed this scene in, I guess it's 2018, in January of 2018, when Trump shows up at Davos. And, you know, for those of us in the press corps, the kind of conventional narrative is, oh, this is so titillating. It's like a prize fight. I mean, Davos man believes in multilateral cooperation and good governance and transparency. And we have to attack climate change and is against racism and misogyny. And here's Trump who, you know, is gaslighting everyone who has pulled the US out of the Paris climate agreement, who fashions himself as a wrecking ball, pointed at the liberal democratic order, you know, ooh, this is just going to be so rich. And the reality on the ground was, yeah, okay, there were a lot of African diplomats who were not pleased about the fact that a man who had used a very filthy, crude term to denigrate an entire continent of people was somehow being celebrated. All of the non governmental organization people, the academics, you know, they were, they were not happy to see Trump. But the people who mattered, I mean, the, again, the tech and finance executives who actually pay the bills in Davos, they could see right through this. I mean, they might say, well, we'd prefer that he not talk about the US national debt like some sort of, you know, loan that his failing casino operation is on the hook to Deutsche Bank. We could live without the misogyny and the racism, but, boy, we sure do like those tax cuts and that deregulation. And so we're, we're for it. And Schwarzman, you know, understood this early. I mean, Schwarzman has a, one of Schwarzman's many residences. I mean, he owns them the way most of us own. Socks is close to Mar A Lago. He and Trump dined together quite a bit. Trump had, had, had given Schwarzman the understanding that he was going to fill his administration with the sorts of people Schwarzman could do business with. And of course he does. I mean, he brings in Steve Mnuchin to run the Treasury. Who's another guy like Schwarzman who's made a fortune on the foreclosure crisis. He, he takes Wilbur Ross, a guy from the private equity world and puts him in charge of the Commerce Department. He, he puts compliant people in, into all the regulatory positions as if, you know, lobbyists are now running the federal government itself. And Schwarzman's great dream is that he's going to be able to break into the, the next great frontier of retirement Investing, which is 401k funds, to get them into so called alternative assets like hedge funds and private equity, which is a chance for him to stick at first fees on onto account holders. But Schwarzman, you correctly note, you know, is most prominently involved, excuse me, in investing heavily into American health care in the run up to the pandemic. He, he, he grasps that this is where the money is. There's $3.8 trillion a year being spent on health care in the United States alone. And in 2016, he spends about $6 billion to buy up a company called Team Health. This is a company that staffs emergency rooms with all sorts of personnel. Schwarzman is a guy who understands, you know, much like a casino magnate who makes their money in a darkened room where people are drinking and understands that's a good way to keep people at the tables to have them drinking and not know what time it is to make your money in the emergency room. That's a particularly sweet part of healthcare because of course, the people showing up in the emergency room are less likely to be familiar with the details of their insurance policies or be in the state to ask about, you know, who's paying for this, what's this going to cost me? I'm just going to sign right here on the dotted line so I can go see the people wearing the white coats back there. And TeamHealth is at the center of what's become known as the surprise billing scandal. The surprise is not of the happy variety. This is, you know, people thinking that they are in hospitals that are part of their health insurance plans only to discover later that they've signed away the right to be treated by somebody in network. They've signed acceptance to be treated out of network and now they're being billed at just a incredible rates. People of lesser means find that they're hassled by collection agents for months afterwards. And this is part of a whole wave of the financialization of American health care. This is how American health care becomes part of our economy. Functioning not unlike your local Starbucks or an Airline where the people coming in the door are less patients than they are customers, the people working in emergency rooms, Our costs to be contained and products need to be sold in the form of tests. Revenue needs to be maximized. And just like, you know, your airline wants every seat on your plane full. If you own a hospital or medical practice, you want your facilities to be packed. This is how in the three decades leading up to the pandemic, the, the U.S. loses roughly a third of its hospital rooms. This is a central part of the explanation for why the supposedly wealthiest, most powerful country on earth, with several months lead time to note what's happening in China and other parts of Asia and then Italy, just is overwhelmed by the pandemic and has people dying on gurneys in hospital room quarters, has frontline medical workers treating people without any kind of ppe. At the center of that is people like Steve Schwarzman who have cannily invested into a sphere that should be treated very differently than we treat Starbucks and airlines.

Caleb Zakrin (47:16)

Now, this might not be something that you can necessarily speak on, but do you know about, you know, the, the view, how these, these different Davos men view each other? Like what, what does Benioff think of Schwarzman? What does Fink think of, of Schwarzman? Are they friends? Are they enemies?

Peter S. Goodman (47:29)

Great question. Benioff, who, who's the guy who talked to me for the book, really chafes at the idea that he's included with these other guys. I mean, he sees himself as, as a good guy. First of all, he engages in that whole sort of like bohemian mysticism shtick that's now become a Silicon Valley cliche. I mean, he, he doesn't pal around with Schwarzman. I assume he knows Fink. He's been on panel discussion discussions with fake. I don't know how friendly they actually are. Benioff sees himself as like a cool kid, right? He's a guy who, he, he has Hawaiian themed parties where he flies in the Black Eyed Peas, you know, for his buddies while they're walking around in Hawaiian costumes drinking Hawaiian themed cocktails. But they all, I argue, are part of this tribe that presents itself as agents of human progress when they are in fact enablers of the status quo. And that's the thing that we have to understand, that they, they are all skilled at taking this stance as change agents, being on the side of the collective public interest, as if there is such a thing. Like there are friends when they're really predators. They are, they are trying to rip our, our faces off and we need to disabuse ourselves of this notion that it's any other way. And that doesn't mean we demonize them. It doesn't mean we take their wealth. It just means we get back to things that we used to have, like progressive taxation and labor rules and antitrust enforcement.

Caleb Zakrin (49:01)

Yeah. I think that one of the central myths that the Davos Men sort of purveys is this idea that the government, you know, isn't, isn't capable of stepping in and helping people. And part of this is because the government over the past 40 years or so has really been, you know, impacted in a negative way, especially because it's been pillaged.

Peter S. Goodman (49:24)

Yeah.

Caleb Zakrin (49:25)

And, you know, it does. You know, if Mark Benioff listens to this, like, I think it would be, you know, interesting if he was a bit more critical of some of his fellow Davos men. And, you know, something I'm wondering is, do you know of anyone, you know, in the sort of Davos class, having read your book and have you been in contact with anyone and heard feedback from them?

Peter S. Goodman (49:50)

I mean, the only thing that I would call feedback is the World Economic Forum itself put up a blog saying that they really appreciate my description of inequality, and of course it's so important, but they take issue with how I've characterized the forum itself. No, it's, it's been crickets from Davos Man. I, I, I, I think, you know, Davos man has this kind of criticism priced in, and that's why it's so difficult to take on Davos man, because Davos man is particularly skilled at taking the attacks and turning them into, you know, proof that Davos man is on the right side of history. I mean, it's been interesting, for instance, to see Fink has been attacked from the right. The state of Texas has come after Fink for his latest shareholder letters where he's, you know, championing the need to take on climate change. And the state of Texas said, well, maybe we need to pull our pension funds out of BlackRock if he's going to threaten to divest from fossil fuel companies. And that actually prompted Fink to say, no, no, no, I'm not talking about divesting from fossil fuel companies. I think fossil fuel companies need a seat at the table. We, everyone needs to join together to, to solve these problems. But I think he's actually strengthened by being attacked by fossil fuel companies because that lends credence to the idea that he must actually really be trying to change something, when in fact he's quietly amassed a $15 billion investment stake for Saudi Aramco to expand their natural gas pipelines in Saudi Arabia. And this is, you know, just a couple of years after the murder of the Washington Post journalist Jamal Khashoggi at the hands of the Saudi regime. So the attacks themselves are Davosman's, very skillful at turning them to his advantage.

Caleb Zakrin (51:41)

Thank you so much for talking to us about your book Davosman. Before we wrap up, is there any final statements that you would like to make about Davos Man? And are you working on anything now, you know, to further your discussion of this subject matter?

Peter S. Goodman (51:59)

Sure. Well, first of all, I think the most important thing we need to understand is that none of this has happened by accident. You know, this, this bottom up transfer of wealth, it's happened, it's not a conspiracy, but it's happened by design. And we need to get out from under these false binary choices that Davos man has foisted on us where, you know, we're supposed to believe that we either can have the miracles of COVID vaccines and Google and Uber and Amazon and central air conditioning or, and we accept tremendous inequality as part and parcel of that, or we monkey with that successful formula and then we end up like Venezuela. I mean, if we, even if we talk about progressive taxation or antitrust enforcement, a Davos man would have the world believe that we're like, you know, know, Bolsheviks at, at, at the gates and we need to get out from under that we're going to have capitalism. We should celebrate capitalism as a source of growth and dynamism and innovation. But it needs rules or it isn't real capitalism anyway. It's corporate welfare for monopolists. So, you know, that would be my biggest takeaway. I'm now working on a book on the great supply chain disruption which I think is badly in need of contextual understanding. Yes, it's partially about the pandemic, but it's about decades of just in time manufacturing mechanisms by which we organized our societies around satisfying consumers with the cheapest possible goods, which has been great for big box retailers, it's been great for shareholders. It has been good. If we're, if we, we look at people just narrowly as consumers, though it's eliminated a lot of choice and it's left us not at all resilient and the pandemic has swamped those systems. So that's the book I'm working on next.

Caleb Zakrin (53:52)

Well, thank you so much, Peter. I look forward to reading that book and hopefully can have you on in the future once it's published.

Peter S. Goodman (53:58)

Love it. Thank you so much Caleb for these great questions.

Caleb Zakrin (54:01)

Thank you. Foreign.

Peter S. Goodman (54:15)

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Caleb Zakrin (54:17)

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