I’m reasonably certain I was the only attendee arriving to the Milken Institute Global Conference by Los Angeles public bus. The organizers recommended that, with parking at a premium around the Beverly Hilton, people use “limo, Uber, Lyft, or taxi,” in that order.
A fifth option was presumably a corporate jet; a $72 million Bombardier Global 7000 was parked adjacent to a bar and lounge, and available for attendee tours.
The Milken conference, named after the junk bond financier who went to prison for securities law violations, is the closest thing that we on the West Coast have to Davos. It’s the kind of place where you can hear one stranger say to another, “You work in Hong Kong? I work in Hong Kong as well!”
Heads of state hobnob with heads of business, and a few celebrities – Kobe Bryant, Tom Hanks – are sprinkled in as well. But most attendees have the words “Capital Management” somewhere on their badges. It’s where the financial elite get together to tell each other elite things, and nod sagely at the results.
“Emerging markets will either be at the bottom of your portfolio or the top,” intoned Afsaneh Beschloss, founder of the hedge fund Rock Creek, during a panel on investing. “Sometimes in the middle.”
It’s like if Tom Friedman was multiplied by 4,300 and congregated in a hotel lobby.
At the root, the Milken conference is an investor conference. Attendees want to know about national politics and global military campaigns, but only insofar as that intelligence produces new opportunities to make money. A panel called “Value in Turmoil” was as packed as any that I attended. “Opportunities in distress” was a recurring theme.
“There’s a lot more hope in emerging markets,” said Steve Tananbaum, a vulture fund investor with GoldenTree Asset Management during a panel in the International Ballroom, the same place where they hold the Golden Globes. “Argentina and Brazil, there’s a reaction that’s a positive, pro-market reaction,” he added, referring to the attempted coup on Dilma Roussef. Discussion of the effect on people living in these countries was outside the frame of reference.
At a different panel, Jim McCaughan of Principal Global Investors pronounced himself “a heretic on infrastructure,” because Uber and driverless cars were so efficient that we didn’t need to spend as much on building roads anymore.
Even former Vice President Al Gore, who gave a version of his famed climate change PowerPoint, pitched it as an investment opportunity. “We are facing not just a moral imperative, but a financial imperative,” Gore said, noting that investors have a unique ability to drive change.
Conference-goers appeared to be dimly aware that the national mood has shifted against elites — which global financial crises and slow recoveries from recession will tend to do. I heard some version of the phrase “people are frustrated and their concerns are real” dozens of times. One major panel asked whether capitalism needed saving.
But there was a funhouse mirror quality to the whole thing, starting with the panelists themselves. The moderator of the discussion on how to solve income inequality was Alan Schwartz, the last CEO of Bear Stearns.
And the ideas weren’t so sharp either, a warmed-over stew of the same ideas elites have been pushing for decades. People are angry that they haven’t gotten a raise in 15 years, so the thing to do about that is business tax reform. Or corporate-written trade deals. Or “better education,” which is code for destroying teachers unions. Or public-private partnerships.
Alan Krueger, President Obama’s former chair of the Council of Economic Advisers, cited a model example for this type of cooperation between business and government: fracking.
Paul Irving of the Milken Institute Center for the Future of Aging suggested that one way to solve the retirement crisis in America was changing the conversation “from retirement as an aspiration to lifelong work as an aspiration.” Others sputtered about over-regulation strangling the economy. At a “Jobs and Technology” panel, former Forbes Managing Editor Dennis Kneale insisted that we didn’t need to give any more benefits to the poor, because he read somewhere that they get $30,000 a year from the government already.
There wasn’t really a partisan edge to the proceedings. On a panel with four state governors, Democrats Terry McAuliffe and John Hickenlooper parroted the same bromides about workforce development and support for trade deals as Republicans Scott Walker and Rick Scott. “Everyone in this room can admire these people,” said the moderator, Eric Schmidt, executive chairman of Google-parent Alphabet.
Most Milken conference attendees exist in the same center-right, business-friendly space, far above those meddling populists with their earthy concerns. In this world, Donald Trump and Bernie Sanders represent exactly the same thing – a threat to the established order.
“At least you have a party,” a resigned Republican Sen. Lindsey Graham lamented to former British Prime Minister Tony Blair, apparently unaware that left-wing forces led by Jeremy Corbyn had taken over Blair’s Labour Party. “Um, right,” Blair responded, to knowing laughter.
Evan Bayh, the senator-turned-lobbyist, unwittingly summed up the conference. “Elites in our country tend to be in an echo chamber,” he said to a room full of bankers, money managers, and chief executives.