Post-Capitalism in Davos

David Ignatius, writing from Davos, is a little shocked by the 'post-capitalist' mood there:

The value of this alpine kaffeeklatsch is that it can tell you when ideas have reached critical mass. And that seems to have happened this year in the general enthusiasm for what I will call "post-capitalism" among the political and business leaders gathered here. They take it as a given that the free market failed in the crash of 2008 and that the new system will be more regulated, more interventionist, more prudential than was the old.

This change in the Davos consensus is important because for the past few decades, the forum has been the leading symbol of the freewheeling economic model known as "globalization" -- a connected world that was fostered by lower tariff barriers, deregulated markets, and borderless flows of capital and labor. In years past, calls at Davos for more financial regulation would have been met with guffaws and an escort to the anti-globalization "Open Forum" down the road.

The Davos vision of globalization -- of ever-rising tides that lifted ever more boats -- was itself a bubble. We can see this now. It burst in the financial crisis in 2008, with pulverizing consequences for the real economy in 2009. But it wasn't until this year that the forum fully reckoned with the mood shift. Its work was no longer to celebrate globalization but, in the words of this year's conference theme, to "Rethink, Redesign, Rebuild."