Davos Diary: The schmooze of the world

Extreme brainpower meets extraordinary wealth at the annual World Economic Forum. Sean O'Grady reports from the plutocrats' playground

Maybe the best way to understand the World Economic Forum, which has just completed its marathon of chattering in the sweet Swiss resort of Davos, is to think of it as a sort of party political conference for international capitalism. Around 2,500 leaders in business, finance, politics, economics and the media gather to debate the state of the world. There are formal sessions – panel discussions and speeches, plus working lunches and dinners. There are also informal chats over coffee, secretive "bilaterals" where serious deals are broached – and, to be honest, some pretty hard, extravagant partying.

Someone told me that two-thirds of the world's wealth is concentrated for a few days in this tiny corner of the Alps, and I would guess something of the same proportion of the planet's brainpower too; half a dozen Nobel prize winners, a few score university professors; countless Herr Doctors and a sprinkling of poetic stardust and royalty (if you like that sort of thing). They've cut down on the Hollywood contingent because it was turning the place into a joke.

Bill Gates, Condi Rice, Gordon Brown, Tony Blair, Henry Kissinger, Queen Rania of Jordan, Rupert Murdoch, Bono, Emma Thompson, prime ministers from France to Singapore, the new breed of Indian and Chinese billionaire entrepreneurs and as many bank chairmen as you could possibly ever wish to encounter. At Davos you can see and hear them all, and even ask them the odd question.

For a journalist that is quite an attractive package, but it takes a few days to realise that, actually, few truly startling stories emerge from the WEF: strict off-the-record rules and a certain quasi-academic atmosphere see to that. Making news is not what the participants are here for. True, some symbolic moments in the Middle East peace process, in the dismantling of apartheid in South Africa and in the campaign against poverty in the developing world have taken place in Davos. But most of the effort is directed towards learning, schmoozing and networking. It can be a bewildering place to be; the sheer scale of it now makes getting a grip on what's going on a little tricky.

When the WEF was started in 1971, by the German-born economist Klaus Schwab, it was a pretty small, low-key, even secretive, affair; 300 or so leaders in their fields taking a week or two out in Switzerland for some skiing and gentle massaging of their grey matter. Dr Schwab is still in charge but his little get-together has turned into a huge media circus, with a lot of ego massaging. It's also a lot more hierarchical; the badge you have denotes your status: White badges allow "participants" into the off-the-record sessions and dinners; a gold badge confines you to the larger, more public sessions such as the opening number by Condi Rice, and is mostly for reporters. Blue badges are for staff. Participants' spouses get slightly different white badges. Then there are the "Hotel" badges, which mean you can't get into the conference centre at all, but can go skiing and get drunk at the parties.

It isn't that flat an organisation: you rarely see the billionaires and presidents queuing for a buffet lunch and the chances of bumping into Bill Gates in the loo are nil: so you get close to the masters of the universe – but not that close.

Corporate sponsorship and a fee of about £2,000 per (egg) head pays for it all and the Schwab Foundation. How much Dr Schwab is worth is an occasional topic of lively conversation.

Watching an economic crisis unfold through the prism of Davos was a novel experience; it is not every day you get the chance to gain a little extra insight into the day's events from a Nobel prize winner in economics. For that at least it was worth falling over (twice) on the black ice that covers the Davosian pavements.

Monday

Zurich airport, 11am. On Swiss soil and when I stroll over to the adjacent railway station (just think of saying that about Heathrow for a moment), to buy my ticket I soon discover the correct way to pronounce "Davos". It does not, as I had assumed, rhyme with the Dr Who baddy Davros. Rather the second syllable is a bit slurred, so it sounds like "divorce". In fact if you want to show yourself to be truly an insider, just call it Divorce. For those without access to private jet or helicopter, Divorce is a difficult place to get to. It means a three-hour train journey with two changes, the last leg being taken on an Alpine branch line. As I wind my way up the mountains it gets less green and more white and chilly: text messages about another bad day on the stock markets – the worst since the aftermath of 9/11 – give me plenty to contemplate. It's due to fears of recession and misery in the US, apparently, and makes an odd juxtaposition with the prosperous, jolly kitsch chalets en route to Hotel Hermann.

Tuesday

What to wear?

Davos has got two climates. Outdoors, it's the usual Alpine mix of sunshine and snow. On the inside, inside the vast Conference Hall purpose built for the summit, and the partying hotels, the micro-climate is like Barbados. If you tog yourself out in Full Metal Puffa Jacket and Moon Boots you risk heat exhaustion during a panel session on Sovereign Wealth Funds; if you wear a suit, coat and normal shoes you could go down with hypothermia waiting for a shuttle bus to your hotel.

Wednesday

The opening address by Condi Rice, which for some reason comes at the end rather than the start of the day, is introduced by Klaus Schwab. He is almost a caricature of himself in his lavish compliments to the American Secretary of State. With his deep, slow Germanic accent and a slightly forbidding bald visage, Dr Schwab looks and sounds like a cross between Dr Strangelove and Dr No. When he pops up on the media centre TV he causes a certain amount of amusement; especially when he is interrupted by a puppet show.

Dinner with three Indian ministers and some of their go-ahead business community; thence to the "Nobel Nightcap" featuring five winners from economics, medicine and peace. Shimon Peres speaks movingly about hope. In the shuttle bus back to the hotel Arthur Mutambara of the MDC, the opposition party in Zimbabwe, explains to me how his country's economy survives.

Thursday

Al Gore and Bono for breakfast; becoming quite a double act. Stelios for elevenses and he reveals he doesn't want to buy Northern Rock.

Sometimes you have to admit your own ignorance. Before I saw his name on the programme, I didn't know who François Fillon was. You neither? Well he's the French Prime Minister, mini-me to Sarkozy's presidential maxi-me. His speech, "France on the Move", is notable for its pledge to freeze French public spending for five years. M. Fillon says he doesn't want France to be left behind as a quaint museum piece, which is how British politicians used to talk a few decades ago. His talk of a dynamic, enterprise economy is Blairite, almost Thatcherite. Still, some things don't change: he is by far the most sharply suited politician around (bon); but the Intervention du Premier Minister is given in French, as is the press release (mal). There are no questions and not a mention of the $7.2bn farce at Société Gé*érale. Must be a terrible blow to Gallic pride; at least it cheers up the Anglophones. The evening's highlights are the AccelorMittal "Speak Easy" and the McKinsey & Co Jazz Funk band. The chief executive of the world's largest private equity house, Stephen Schwarzman of Blackstone, has taken his tie off and is gyrating faster than the Nasdaq on a bad day. Quite a sight. At dinner I find myself in the company of the cellist Yo-Yo Ma, the premier of Quebec, Jean Charest, and Ken Livingstone. It seems they've banned public signage in English in favour of French in Quebec.

Friday

An awful lot of Gordon Brown today, who seems to have fallen for Queen Rania of Jordan, and I can't blame him. Bill Gates announces more help for Africa but declines my offer of a chat.

By now I have realised that there is a strong inverse relationship between the urgency with which the WEF staff deliver press releases and the newsworthiness of the contents. The revelation that "Switzerland Tops 2008 Environmental Scorecard at World Economic Forum" is rushed into my hands with the sort of zeal that should really be reserved for events such as the birth of Jesus Christ. Sadly, there is no space for the Swiss breakthrough in tonight's edition. The stock markets have recovered, the sun has come out and three nights of emergency infusions of liquidity (champagne/cocktails/beer) seem to have cheered the participants.

Dinner is a biofuels-themed affair, enlivened by a dispute with the Brazilians about the fate of their rainforest. Their message is that if we want them to leave it alone we'll have to pay 'em. Bosses of BP, Volvo and Unilever give the commercial angle, the director general of the UN's Food and Agriculture Organisation, Jacques Diouf of Senegal, speaks for Africa, and the UK Government's scientific adviser and professors from Yale and Harvard are the experts. See what I mean about brainpower?

The Google Party at the Hotel Belvedere is lively; but I prefer the lower-key Booz Allen do, and a chat with Steve Forbes, the nicest billionaire I've ever met. Rounded off with the traditional raucous boozing and singing session at the Hotel Europe's piano bar. This is where you get to see plutocrats being naughty.

Saturday

"What about the Aegean?" The giant TV screen in the press room is carrying coverage of the "Turkey's Challenges" session, starring Ali Babacan, the Turkish Foreign Minister. You can't turn the volume down and I find myself being force fed a crash course in international relations in the eastern Mediterranean. I'm disturbed by quite how much people who work in foreign affairs think-tanks are in love with themselves. Some stray words from Peter Mandelson on the trade talks give us a little story. Fondue dinner for the press, black tie soiree and more booze.

Sunday

Monday in reverse. I arrive in London sorry to leave Davos.