It’s that other time of year again. The time when the world’s business and political elites gather at an Alpine resort in Davos, Switzerland, to compare notes on the challenges they face. The top risks under discussion this year, released in advance by the World Economic Forum, are cybersecurity and “a deterioration in the geopolitical situation.” The first of these two risks, cybersecurity, represents merely the latest in a long line of threats that have emerged from technological development as states and private actors jockey for an edge over one another. But the second risk, geopolitical deterioration, has not been much of a focal point for several decades. And because geopolitics is the platform on which many other things rest, its deterioration is a threat that affects not only Davos attendees, but also the entire global population.
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The World’s Waltz
Business and geopolitics have been waltzing together for many centuries, taking it in turns to lead the dance. The modern corporation, for example, can trace its roots back to agreements struck between businessmen in the Eastern Mediterranean around the time of the Crusades. These early contracts were struck between a sedentary investor — who provided the capital — and a brave traveler — who accompanied the tradable goods on a dangerous voyage. But these incredibly basic corporations could function only within the bounds of their geopolitical environments. Friendly relations between Venice and the Muslim world, for example, allowed Venetian travelers to become the world’s preeminent businessmen by selling eastern goods in Europe for high profits.
At other times — most notably when geopolitics have been fragmented — business has led the way. The Hanseatic League, a group of cities ringing the Baltic and North seas that was almost entirely motivated by profit, arose during a time when Germany was a loose patchwork of cities and small states. To protect its investments, the league created a navy, which forced sovereign governments to take the group of merchants seriously. Later on, businesses led nations into empire. The Dutch and British East India companies, created to be arms of their national governments, harnessed the motivations of private businesses while also furthering national interests — all without committing excessive resources.
