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The thief, or the diplomat, who looks backwards, booty in hand, may not know where, or into what, they are heading; and those who look on, from the camp or elsewhere, are invariably left to wonder whether the agent is stealing from oneself or from others.
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European Commission President Ursula von der Leyen has the unfortunate distinction of serving in that capacity this year. And she is a master crafts-person; but one now faced with the unpalatable task of responding to challenges, not so much by projecting the old vision outward , but now by suggesting the transformation of that vision as a sort of safe harbor from what, to the holders of the old vision, might appear to be an even more unpalatable alternative. These tropes were very much on display in her remarks delivered at Davos. The contrast with the remarks of the Chinese Premier was instructive.
The EU Commission President von der Leyen's counterpart, Chinese Premier Li Qiang, the EU Commission President spoke to the Davos 2024 theme--"Rebuilding Trust" as serving as a gateway to trust in the inevitability of a new (trust) order and in the trustworthiness of its new leadership core (speech and my reflections here). In contrast, EU Commission President von de Leyen spoke to the "rebuilding" of trust through the lens tropes and performances of risk--prevention, mitigation, and remedy. This is a very European theme, but one with substantial resonance among the international techno-administrative classes and their academic and civil society followers. While Li Qiand spoke to trust built on evidence of success, such as he proffered, von der Leyen spoke to trust measured against an ideal of a risk management technocracy; one ultimately shepherded, not by a vanguard communist party (LiQiang) but by the leading forces of a global techno-bureaucracy.
The EU Commission President von der Leyen, then, did not merely address risk as a useful abstraction. Rather risk was to totem, the semiotic object, the signification of which as the abstract notion of trust, would necessarily have to be interpreted by the political community as a necessary (re)focus on the administrative and political consequences of a commitment to cultures of risk aversion, risk management, and strategic risk curation as an overall strategy for the ordering of markets driven (may less so now) liberal democratic rules based orders. Markets driven liberal democratic orders, it might appear, are now understood through the language and discourse of risk, one managed by rules, supervised by legitimate political organs, and bent toward public policy that are meant to materialize well managed markets within and in the service of the broader objectives of liberal democratic political orders that are tied to place, space, and time. In this new era of liberal democracy, the post-1945 vision has been transformed to one of managed risk in the service of the state, with a well curated space for individual operationalization of increasingly well projected policy objectives.
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Like Li Qiang's remarks, those of von der Leyen are quite revealing. They are revealing of the discursive baselines and ideological groundings from which each of the collectives they represent both view the world and the role of political collectives within it. Both consider the fundamental principles driving trust (in the language of the word smiths at Davos responsible for its theme, of transparency, consistency, and accountability, and its substantive sub-themes). So how does trust in risk as a baseline produce difference and convergence in the approaches displayed in von der Leyen's remarks?
1. The Discourse of "glass half empty" tropes and their policy consequences. Von der Leyen starts her remarks by a partial descriptive catalog of the global risk universe, and then offering which among the sorts of risks ricocheting around the world might be of major interest to economic (rather than political, social, cultural or religious) actors: "It is disinformation and misinformation, followed closely by polarisation within our societies. These risks are serious because they limit our ability to tackle the big global challenges we are facing: changes in our climate – and our geopolitical climate; shifts in our demography and in our technology; spiraling regional conflicts and intensified geopolitical competition and their impacts on supply chains." (Von der Leyen remarks). Thus the risk spiral, and the place of economic actors within its pathways. If risk drives the trajectories of global social collectives, then diplomacy is in order as the tonic through which risk may be reduced or avoided--that is what trust building means--reducing risk of the negative (as that is in turn defined by those who measure such things). But risk-as-trust is also a doorway, a doorway to potentially radical acceleration of trends in social organization with respect to which Europe has taken upon itself a vanguard (perhaps Leninist) role: " This requires immediate and structural responses to match the size of the global challenges. I believe it can be done. And I believe that Europe can and must take the lead in shaping that global response." (Von der Leyen remarks).
2. From theory to technocracy; or the comfort of well curated analytics. As a form of bathos, perhaps, von der Leyen then moves swiftly from the theoretical convergence of trust in and as risk, to the technologies of risk analytics. She starts with the World Economic Forum's own Global Risks Report for 2023 "to map out a way forward" (Von der Leyen remarks). To that end, it is necessary to rethink the current relationship between public actors and their organs of institutional control, and private economic actors (though one might wonder what sorts of non-economic actors do not induce or produce economic effects). The pitch is for "democracies" (Von der Leyen remarks), and one wonders here whether the object is to include or exclude those states, like China, seeking recognition of democratic organization that is not "liberal." At the same time the tilt might necessary because Chinese Marxist-Leninism has already put forward a model of the private within the public within socialist democratic (new era) theory--and that objective may be one that must now be transposed into liberal democratic states in a context aligning way.
It has never been more important for the public and private sector to create new connective tissue. Because none of these challenges respect borders. They each require collaboration to manage risks and forge a path forward. And this is what I want to talk about today (Von der Leyen remarks).
This is no bathos, after all, but a quite remarkable turn. If trust is a function of and manifested against risk, and if economic risk is now understood as a manifestation of political risk, then the hierarchies of politics over economics (or better perhaps, the premise of economics as a manifestation of the politics of the use of productive forces) becomes clear. And what is clearer still is that this hierarchy requires a political oversight. But not necessarily a political oversight of elected officials--that is messy and itself risky (elected officials are inherently untrustworthy perhaps is a hidden message)--rather techno-administrators, public servants with a social science approach, may be required to dispassionately approach and manage risk.
While governments hold many of the levers to deal with the great challenges of our time, businesses have the innovation, the technology and the talents to deliver the solutions we need, to fight threats like climate change or industrial-scale disinformation. Europe is uniquely placed to show how this can work. Because our democracies and our businesses have interests that align. . . A Union of 27 democracies where all of us have the right to speak our mind, to be ourselves, even if we are different from the majority. In a democracy it is the people, with their choices and behaviours, who pick winners and losers in the economic arena. Companies are free to compete. Changemakers are free to innovate. Merit determines economic success. And our rules are built to ensure this: to protect intellectual property, the safety of industrial data, or the savings of people and companies. And Europe stands up for global trade based on fair and open markets. (Von der Leyen remarks)
She means what she says, certainly, but does she say precisely what she means? The measure, again is risk. And that risk measure is the Russian aggression against Ukraine, with its transformative consequences, the exemplar that occupies a substantial portion of the remarks as descriptor and substantiating fact basis for the larger points made. In the new vision of administrative supervision, political and economic consequences are firmly intertwined. "Russia's failure is also economic. Sanctions have decoupled its economy from modern technology and innovation. Russia is now dependent on China. And finally, Russia's failure is also diplomatic. Finland has joined NATO. Sweden will follow soon. And Ukraine is closer than ever on its path to the European Union." (Von der Leyen remarks).
4. The new frontier: AI as risk and template. The shape of the new regime of administrative supervision was nicely evidenced by von der Leyen's extended discussion of the triumph of Europe over the risks of generative intelligence and autonomous non-human data-based iterative personalities (my critical view on that score here; and here). Whatever one thinks of the appropriate regulatory response to generative intelligence, the more interesting aspect here is its risk related consequences for governance.
When we took office four years ago, we felt the need to set clear guard rails at European level, to guide the development and deployment of artificial intelligence. This is the thinking behind Europe's Artificial Intelligence Act, actually the first of its kind anywhere in the world and another example of how democracies and businesses can help strengthen each other. The Artificial Intelligence Act builds trust by looking at high-risk cases, like real-time biometric identification. And by building that trust, it enables companies to innovate in all other fields to make the most of this new and revolutionary technology. (Von der Leyen remarks)
What emerges is quite clear: economic innovation cannot be left to what had been a larger scope of discretion vested in private actors. The protection of political values requires political supervision of innovation and the economic principles that provide its impulse. To that end a technical set of political organs are necessary, and the "space" created within which, now watched and assessed (accountability through rule based administrative regulatory orders), the political and social risk of economic activity may be reduced through guidance and assessment. "Our companies thrive on freedom – to innovate, to invest and to compete. But freedom in business relies on the freedom of our political systems. This is why I believe strengthening our democracy and protecting it from the risks and interference it faces is our common and enduring duty."(Von der Leyen remarks).
None of this is bad, of course. But it does suggest a remarkable convergence in the taste of political and techno-administrative classes (and their supporters within the intelligentsia) for the administrative supervision (leadership, guidance and coordination under a vanguard in Marxist Leninist states) irrespective of the underlying ideological basis of political organization of the state and its specific political objectives. Half full or half empty--the administrative glass is brimming. Again, a pity that much of this remains obscure who seek reinforcement of their own perspectives in the speeches which are heard but perhaps not listened to as carefully as they might deserve (see, e.g., here, here, here, and here).
The full text of the Remarks follows below.
This is the second of the set of reflections on the remarks of Li Qiang, Ursula von der Leyen, and Javier Milei delivered at the 2024 WEF in Davos; each can be accessed here:
Special Address by President von der Leyen at the World Economic Forum
16 January 2024
Excellencies,
Ladies and Gentlemen,
Dear Klaus,
Your annual Global Risk Report makes for a stunning and sobering read. For the global business community, the top concern for the next two years is not conflict or climate. It is disinformation and misinformation, followed closely by polarisation within our societies. These risks are serious because they limit our ability to tackle the big global challenges we are facing: changes in our climate – and our geopolitical climate; shifts in our demography and in our technology; spiralling regional conflicts and intensified geopolitical competition and their impacts on supply chains. The sobering reality is that we are once again competing more intensely across countries than we have in several decades. And this makes the theme of this year's Davos meeting even more relevant. ‘Rebuilding trust' – this is not a time for conflicts or polarisation. This is the time to build trust. This is the time to drive global collaboration more than ever before. This requires immediate and structural responses to match the size of the global challenges. I believe it can be done. And I believe that Europe can and must take the lead in shaping that global response.
The starting point for that is to look deeper at the Global Risk Report to map out a way forward. Many of the solutions lie not only in countries working together but crucially on business and governments – business and democracies – working together. It has never been more important for the public and private sector to create new connective tissue. Because none of these challenges respect borders. They each require collaboration to manage risks and forge a path forward. And this is what I want to talk about today.
While governments hold many of the levers to deal with the great challenges of our time, businesses have the innovation, the technology and the talents to deliver the solutions we need, to fight threats like climate change or industrial-scale disinformation. Europe is uniquely placed to show how this can work. Because our democracies and our businesses have interests that align: creating prosperity, wealth and security for people, creating a stable environment to unlock innovation and investment, and creating equal opportunity and freedom. This is more important than ever as we start 2024 – the biggest electoral year in history. Democracies across the world will head to the polls, and half of the global population will be affected; this includes over 450 million people in the European Union. A Union of 27 democracies where all of us have the right to speak our mind, to be ourselves, even if we are different from the majority. In a democracy it is the people, with their choices and behaviours, who pick winners and losers in the economic arena. Companies are free to compete. Changemakers are free to innovate. Merit determines economic success. And our rules are built to ensure this: to protect intellectual property, the safety of industrial data, or the savings of people and companies. And Europe stands up for global trade based on fair and open markets.
Of course, like in all democracies, our freedom comes with risks. There will always be those who try to exploit our openness, both from inside and outside. There will always be attempts to push us off track, for example with disinformation and misinformation. And nowhere has there been more of that than on the issue of Ukraine. So let me provide you with some real information. Russia is failing on strategic goals. It is first and foremost a military failure. We have not forgotten that when Russia invaded Ukraine, many feared that Kyiv would fall in just a few days, and the rest of the country within weeks. This did not happen. Instead, Russia has lost roughly half of its military capabilities. Ukraine has driven Russia out of half of the territories it had captured. Ukraine has pushed back Russia's Black Sea Fleet and reopened a maritime corridor to deliver the grain to the world. And Ukraine has retained its freedom and independence. Russia's failure is also economic. Sanctions have decoupled its economy from modern technology and innovation. Russia is now dependent on China. And finally, Russia's failure is also diplomatic. Finland has joined NATO. Sweden will follow soon. And Ukraine is closer than ever on its path to the European Union.
All of this tells us that Ukraine can prevail in this war. But we must continue to empower their resistance. Ukrainians need predictable financing throughout 2024 and beyond. They need a sustained supply of weapons to defend Ukraine and regain its rightful territory. They need capabilities to deter future attacks by Russia. And they also need hope. They need to know that, with their struggle, they will earn a better future for their children. And Ukraine's better future is called Europe. It was with immense joy that last month we decided to launch the accession negotiations for Ukraine's EU membership. This will be Ukraine's historic achievement. And it will be Europe responding to the call of history.
Ladies and Gentlemen,
We all know that Russia's invasion has also had an impact on the cost of living and the cost of doing business here in Europe. I know how much that has affected some of your companies. But I started by saying that the risks we face require collaboration between countries and business and that our joint capacity to respond was far stronger than we might believe. And nowhere is this best exemplified than when it comes to energy and sustainability. Two years ago, before Russia's aggression against Ukraine, one in five units of energy consumed in the European Union in 2021 was imported from Russia. This high dependence on Russia was widely recognised as a risk, especially after Russia's occupation of Crimea. And then came Russia's invasion of Ukraine. Russia had already increased Europe's vulnerability by deliberately not filling gas storages to their usual levels. And in the face of Ukrainian heroism and European solidarity, Putin decided that the time had come to threaten Europe directly by cutting gas supplies and using energy as his weapon.
We all carry the bruises from Putin's decisions. We faced difficult choices and uncertainties, especially during the winters. But we made the right choices. Now, only two years later, Europe has taken its energy destiny back into its own hands. Last year, one in twenty units of energy consumed in the European Union came from Russia. Sure, the crisis checked momentum in the European economy but fears of economic collapse proved unfounded. And now energy prices have come down and stayed low even during the recent cold snap at the start of January. Gas storages are still well supplied. Europe has made real progress in improving the resilience of its energy system. How was this possible? Because we acted in collaboration. Because we had well-functioning and open markets and good friends around the world that stepped in and stepped up alternative supplies. Because we had a Single Market that allowed us to redirect flows of energy to where it was needed. But most of all, because we doubled down on clean energy transitions, investing in the clean, efficient and renewable technologies of the future.
European industries and companies have been central to this. Latest numbers from the International Energy Agency show that growth in renewable energy capacity hit another record in the European Union in 2023. And the European Union improved the efficiency of its energy use – the best energy is the one that is not used – by almost 5%. In this way, we turned Putin's challenge into a major new opportunity. Last year, for the first time, the European Union produced more electricity from wind and sun than from gas. And this year, for the first time, the European Union is set to get more overall energy from wind and solar photovoltaic than it does from Russia. That is good news. But amid the reasons for optimism, let us not forget a key lesson from the crisis. Overreliance on one company, one country, one trade route comes with risks. That is why the European Green Deal puts such strong emphasis not just on reducing emissions but also on a strong, competitive European presence in the new clean energy economy. This includes Europe's leadership in clean energy technology, development and innovation.
Ladies and Gentlemen,
Dear Klaus,
Let me go back to the number one concern of the Global Risk Report: disinformation and misinformation. Tackling this has been our focus since the very beginning of my mandate. With our Digital Services Act, we defined the responsibilities of large internet platforms on the content they promote and propagate. A responsibility to children and vulnerable groups targeted by hate speech but also a responsibility to our societies as a whole. Because the boundary between online and offline is getting thinner and thinner. And the values we cherish offline should also be protected online. This is even more important in this new era of generative AI.
Now the World Economic Forum Global Risk Report puts artificial intelligence as one of the top potential risks for the next decade. First of all, let us not forget that AI is also a very significant opportunity, if used in a responsible way. I am a tech-optimist. And as a medical doctor by training, I know that AI is already revolutionising healthcare. That is good. AI can boost productivity at unprecedented speed. First movers will be rewarded, and the global race is already on, without any question. Our future competitiveness depends on AI adoption in our daily business. And Europe must up its game and show the way to responsible use of AI. That is artificial intelligence that enhances human capabilities, improves productivity and serves society. We should invest where we have a competitive edge. For instance, Europe has got talent. There are nearly 200,000 software engineers in Europe with AI experience. That is a greater concentration than in the United States and China. And our continent also has a huge competitive edge when it comes to industrial data. We can train artificial intelligence on data of unrivalled quality, and we want to invest in this. This is why we will provide European start-ups and SMEs with access to our world-class supercomputers, so that they can develop, train and test their large AI models. This is similar to what Microsoft is doing for ChatGPT, by running it on its own supercomputers. We will also put common European data spaces at the service of start-ups. And we will make available massive amounts of data in all EU languages, because AI should work also for non-English speakers. This is the new frontier of competitiveness. And Europe is well positioned to become the leader of industrial AI – the use of AI to transform critical infrastructures to become intelligent and sustainable.
When we took office four years ago, we felt the need to set clear guard rails at European level, to guide the development and deployment of artificial intelligence. This is the thinking behind Europe's Artificial Intelligence Act, actually the first of its kind anywhere in the world and another example of how democracies and businesses can help strengthen each other. The Artificial Intelligence Act builds trust by looking at high-risk cases, like real-time biometric identification. And by building that trust, it enables companies to innovate in all other fields to make the most of this new and revolutionary technology.
Ladies and Gentlemen,
Our world is in an era of conflict and confrontation, of fragmentation and fear. For the first time in generations, the world is not at a single inflection point. It is at multiple inflection points, with risks overlapping and compounding each other. And there is no doubt that we face the greatest risk to the global order in the post-war era. But in my mind, there is also no doubt that we can move forward with optimism and resolve. Yes, the risks we face are real and present. But in order to face risks we have to take risks – together. This is what Europe has always done. The European Union is at its best when we are bold, as we have seen only in the last few years on the European Green Deal, NextGenerationEU, supporting Ukraine or facing up to the pandemic. The next years will require us to think in the same way. And I believe the common power of our democracies and our business and industry will be at the heart of this. Our companies thrive on freedom – to innovate, to invest and to compete. But freedom in business relies on the freedom of our political systems. This is why I believe strengthening our democracy and protecting it from the risks and interference it faces is our common and enduring duty. We need to build trust more than ever and Europe is prepared to play a key role.
Thank you very much.
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