Quotes of the Day

The thing about the annual meeting of the World Economic Forum in Davos is this: you never get time to think. The crush of business leaders, politicians, scientists, thinkers and celebrity do-gooders is so great, the cornucopia of temptations on display so salivating, that you can't quite get your head — which is, in any event, likely to be fogged from the night before — around what you've heard or seen. (Did Brad Pitt really have jet-black hair and sideburns?) So on the last day of Davos I enjoy a little ritual. After lunch, I take myself to the very top of the mountain above the town and ski the long run all the way down into Klosters. Just above that picture-postcard Swiss village, I stop at a hillside inn, have a gluhwein, and try to make sense of what I've learned. So here are this year's piste-side thoughts.

We live in an uncertain world. Well, duh, you say, when has the world ever been certain? Fair enough: but the half-generation since the end of the cold war was shaped by a set of circumstances that did at least lend themselves to easy characterization. That is to say: the U.S. was dominant. The U.S. economy was the most productive and innovative in the world, while U.S. political and military power was such that whatever Washington wanted — once it had made up its mind to want something, which could take time — it got, whether that was a settlement in the Balkans, or regime change in Afghanistan and Iraq.

At Davos this year, the certainties of the post–cold war world seemed less fixed than they once were. Of course, U.S. ingenuity and productivity continues to lead the world economy; the home of Internet 2.0 will be in the U.S. just as its predecessor was 10 years ago. (The real stars at Davos this year were not Pitt and his friends but Larry Page and Sergey Brin of Google, whose every appearance at parties was greeted by the sort of frenzied neck craning that last year was reserved for Sharon Stone.) U.S. multinational companies continue to dominate global business, just as U.S. universities would dominate any list of the best in the world. But while we were in the Swiss mountains, Hamas won a landslide — and thoroughly unpredicted — victory in the Palestinian elections, overturning established patterns in the Middle East and demanding hurried improvisation in Washington. Last week's State of the Union speech by President George W. Bush was full of implicit reminders that the U.S cannot always bend elemental forces to its will. Even the mighty U.S. economy cannot simply shrug off a doubling of the price of oil in two years, especially since — as Bush said — oil is "often imported from unstable parts of the world." Bush may describe Iran as a "nation now held hostage by a small clerical élite," but the slow, multilateral diplomacy that has characterized his Administration's approach to the crisis over Iran's nuclear ambitions is evidence that there are issues that directly impact the national interests of the U.S. that Washington cannot solve alone.

So what are the forces that will shape our uncertain world? Here are some that were on view in Davos.

THE END OF CHEAP ENERGY At Davos, oil-company executives were quick to point out that the doubling of oil prices has not led to chronic shortages. Industries, families, whole economies (like that of Japan) have learned to be far less profligate in their use of energy since the price shocks of the 1970s.

Fair point. Yet it is foolish to imagine that the end of the era of cheap oil will not have profound impacts on the way the world is ordered. Already, it is changing the geopolitical balance, emboldening Iran, and convincing Russian leaders that their country may not, after all, be the great loser of the age. And look at China. Now a net importer of oil, its companies are involved in searches for supplies from Africa to North America, while its diplomats have been drawn into such Great Power debates as the Iranian question, from which they have hitherto tried to keep a distance. Down the line, the new price of oil is going to make all sorts of cleaner energy sources more relatively cost effective than they have been. That is going to lead to the development of industries of which we can today hardly dream, and may yet ameliorate some of the dire consequences of climate change — a topic unmentioned by Bush in his State of the Union address, but which his predecessor Bill Clinton said at Davos was his single greatest worry for the years ahead.

the two giants Larry Summers, president of Harvard University and former Secretary of the U.S. Treasury, likens the integration of India and China into the world economy as one of those great disruptive forces — like the Industrial Revolution — that stand life on its head. Surely, he is right. For 150 years, the two Asian giants have been mere tributaries to the current of world events; increasingly, they will dictate its flow.

But how? There was one curiosity about the all-consuming India vs. China debate at Davos. The most impressive Chinese present were government servants, technocrats who could talk the language of international trade and finance as if they had degrees from the best graduate schools in the U.S. (which of course many have). The best Indians, by contrast — and this was before the news broke of Lakshmi Mittal's audacious bid for Europe's steel giant Arcelor — were business leaders from the private sector, already building brands (as very few Chinese firms yet have done) with a global reputation.

This speaks to a significant difference in the Chinese and Indian economies. Mittal may have spurred protectionist talk from some European politicians, but at least his bid for Arcelor cannot be dismissed on the grounds that he is merely a stalking horse for his home nation's government. Yet that (and with reason) was the fate of the Chinese oil company cnooc, when it tried to buy the U.S. firm Unocal last year. The cheerleaders for China — and oh, how many there were at Davos — might occasionally reflect that its economic policy is still directed by a government proud to call itself Communist. It is still far from clear — now here's an uncertainty — that over the next decade China will be able to navigate a course that grows prosperity, with all the expectations of clean, accountable government that go with it, without also relaxing the Communist Party's grip on political power.

One more curiosity. For all the attention paid to India and China, the denizens of Davos this year seemed willfully oblivious to the revival of the Japanese economy, and to the palpably renewed self-confidence among the Japanese political élite that their lost decade is over. Japan, remember, is the world's second largest economy, with an income per head at a level that China will not reach for generations. The world has never had to deal with a strong China and a strong Japan at the same time. So here's more uncertainty: How will the two giants of northeast Asia handle each other? How will the U.S. — a close ally of one and a commercial partner of the other — ensure that rivalries between them are kept within bounds?

the oldest world Did anyone at Davos have anything good to say about the future of Western Europe? If so, I must have missed it. For those of us who remember the heady days after the fall of the Berlin Wall, and the way in which the frozen stubble to its east came to life, there was something almost unbearably poignant in the way in which Europe was dismissed with a shrug this year — hardly worth talking about. I heard one distinguished commentator say that at least life in Europe was comfortable — only to be rudely told by a leading businessman that it wouldn't be for his children.

Of course, there were bright spots. Angela Merkel, making her debut as Germany's new Chancellor, gave a well-received speech. (I particularly liked her homage to Ludwig Erhard, the architect of the post-1945 Wirtschaftswunder — when was the last time that he got his due?) Gordon Brown, Britain's Chancellor of the Exchequer, got a round of heartfelt applause — but for his many contributions to ameliorating poverty and misery in the developing world, not for anything he has done to shake the rich half of Europe out of its slumber. Two years ago, at the Time Board of Economists in Davos, Moisés Naím, editor of Foreign Policy magazine in Washington, said that Europe "has a tsunami coming its way" in the shape of competition from Asian and U.S. rivals. Yet as old manufacturing industrial areas are hollowed out — think of northern Italy — there is still no sign of urgency among the European élite about how they might respond to the new world.

There was more, of course — at Davos, there always is. Those wanting a sneak preview of a possible 2006 match-up in the U.S. presidential race could catch both Senator John McCain and former Virginia Governor Mark Warner. Those anxious to understand modern design could chat to Rem Koolhaas, while opera buffs sought out Peter Sellars. You have to pick and choose in Davos, to decide what it is that you take away from the long journey up the mountain. For me, the key message was that things are not going to be as we have grown used to them being. See, here's the thing: Brad Pitt really did have black hair.

• MICHAEL ELLIOTT
• The few certainties of the post–cold war world are getting fewer