The divide between the “political elite” and the “working class” is the “number one” risk to modern society, according to the head of Allianz.
Oliver Bäte, who currently serves as the CEO of the German insurance giant Allianz, made the remarks on Tuesday this week during an interview with CNBC news at the World Economic Forum (WEF) in Davos, Switzerland.
NEW – Allianz CEO: "We have an increasing detachment of the political elite from the working class." pic.twitter.com/KJuFJEXu06
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The theme of the WEF conference this year is “rebuilding trust.”
Bäte said that the “biggest problem” in Europe at the moment is populations ceasing “to trust their government.”
“You’ve seen recent elections in the Netherlands, you’ve seen that in France, and societies are polarised, because our leaders are not addressing the needs of the people,” he said.
“We have an increasing detachment of the political elite from the working class and the people that actually go to work every day, and that I see as the number one risk for our societies.”
Bäte went on to reference the fact that there are an unprecedented number of national elections set to take place this year across the world in at least 64 countries, meaning that as much as 49% of the world population will be going to the polls in 2024.
“And remember, this year, a lot of people are going to vote,” he said, adding: “So we need to make sure they, you know, vote for the right things, and they’re not just venting anger.”
Asked how to rebuild trust with populations who feel “disenfranchised” by their governments and climate policies, Bäte replied: “You start by saying the truth.”
“You know, when you say ‘I have to invest hundreds of billions in transforming our economy,’ it means you have to take the money from somewhere else, because there’s a limited amount of that capacity that you’ve mentioned. And we’re not telling the people the truth.
“It’s said that ‘We can have this transformation for free, and everybody keeps the subsidies’ – [but] it doesn’t work.
“So the first thing is to say, the truth – what will be the economic cost, what will be the human cost, and then offer solutions.
“This is also a problem here. We talk a lot about the problems – we talk too little about what are the practical solutions by which we will solve things.”
Bäte went on to say that while it may be politically difficult, governments must start funding infrastructure projects more.
“One of the most important macro themes is we have to stop really stop spending money on consumption,” he said.
“We need to really build invest in infrastructure. And that’s very hard to do for a politician, I know, because you get elected on promising money to people. But you have to say the truth, and say ‘We need to invest, and therefore we cannot fund your hobby anymore.’”