They're Global Citizens. They're Hugely Rich. And They Pull the Strings.
We didn't elect them. We can't throw them out. And they're getting more powerful every day.
Call them the superclass.
At the moment, Americans are fixated on the political campaign. In the meantime, many are missing a reality of the global era that may matter much more than their presidential choice: On an ever-growing list of issues, the big decisions are being made or profoundly influenced by a little-understood international network of business, financial, government, cultural and military leaders who are beyond the reach of American voters.
In addition to top officials, these people include corporate executives, leading investors, top bankers, media moguls, heads of state, generals, religious leaders, heads of terrorist and criminal organizations and a handful of important cultural and scientific figures. Each of these roughly 6,000 individuals is set apart by their power and ability to regularly influence millions of lives across international borders. The group is not monolithic, but none is more globalized or has more influence over the direction in which the global era is heading.
Doubt it? Just look at the current financial crisis. As government regulators have sought to head off further market losses, they've found that perhaps the most effective tool at their disposal is what the president of the New York Federal Reserve Bank described to me as their "convening power" -- their ability to get the big boys of Wall Street and world financial capitals into a room or on a conference call to collaborate on solving a problem. This has, in fact, become a central part of crisis management, both because national governments have limited regulatory authority over global markets and because financial flows have become so large that the real power lies with the biggest players -- such as the top 50 financial institutions that control almost $50 trillion in assets, by one measure nearly a third of all assets worldwide.
Most major companies are both bigger and more global today, which effectively makes them able to pick and choose among various governments' regulatory regimes or investment incentive programs. They play officials in country X against those in country Y, gaining leverage that makes the old rules of trade obsolete. The world's biggest corporations, such as Exxon or Wal-Mart, have annual sales (and thus financial resources) that rival the gross domestic product of all but the 20 or so wealthiest nations. The top 250 companies in the world have sales equal to about a third of global GDP (these are very different measures, but they give a rough sense of relative size).
Major media organizations such as Rupert Murdoch's News Corp., which is effectively controlled by a single individual, touch far more people each day than any national government can. Just a few weeks ago, Italian media billionaire Silvio Berlusconi once again used his extraordinary resources to win election as prime minister, which will give him a seat at G-8 summits and other global conclaves. Even global terrorist organizations such as al-Qaeda or Hezbollah have both the ability, through their international networks, and the will to project force more effectively on an international level than all but a handful of governments.
The people who run these big international organizations can have much more power over key aspects of your daily life and over global trends than most officials in Washington are likely to have, except in the most extreme circumstances. They can affect investments and job creation, shape culture and influence lawmakers. The Federal Reserve Bank has played a critical role in the financial crisis, but it couldn't have intervened successfully without a financial leader like Jamie Dimon, chief executive of J.P. Morgan Chase, which stepped in to purchase the failing investment bank Bear Stearns.
The rise of the global superclass signals the latest evolution in the age-old tale of the few who corner the market on power. There have always been elites. But this contemporary group is very different from those that preceded it. Study these 6,000 or so individuals, and you'll find that unlike past aristocrats who inherited their wealth, many -- Bill Gates, for instance, or Warren Buffett -- have built their fortunes over their lifetimes. Many more come from the worlds of business, finance and media than in the past.
What's more, many acknowledge that they increasingly have more in common with fellow members of the global elite than they do with the people of their own nations. Russian oligarch Roman Abramovich, for instance, may be governor of a Siberian province, but he also manages to live large in London, where he owns a famous English soccer club. Even though he has donated millions to help his province, he spends considerably more time with global business partners or his posh neighbors in Britain than he does with his constituents back home.
At the same time, political and military elites are fading in relative influence -- the former bound by geography, the latter by the extraordinarily high cost of modern warfare. The regional composition of the group is changing as well, as transatlantic elites who today make up about 60 percent of the class gradually give way to a rising cadre of Asian leaders, such as the 100 Chinese billionaires estimated to have emerged in the last couple of years.
In a world with only two kinds of international institutions -- weak and dysfunctional -- the members of this superclass are filling a power vacuum when it comes to influencing decisions about transnational issues such as financial-market regulation or climate change. (Many countries voted for the Kyoto accords on global warming, but it took just Exxon and a handful of other oil companies to successfully lobby the White House to opt out and undercut the entire initiative.) In so doing, they raise real questions about the future of global governance. Will the global era be more democratic or less so? Will inequality continue to grow, as it has for the past three decades of this group's rise, or recede? Will the few dominate because the government mechanisms that traditionally represent the views of the many are so underdeveloped on a global scale?