Crisis? What crisis? These famous words (never) spoken by James Callaghan are the best summary of the latest view from Davos. On Wednesday the big story on everybody’s lips was the end of the world economy as we know it and the dominant intellectual influence was that prophet of doom and human fallibility, George Soros. By Thursday morning, however, the Dow Jones Industrial Average had bounced 300 points and the US government had said it announced its long-awaited Plan B - a rescue of the mortgage market and the “mono-line bond insurers” (an obscure financial species previously unknown even to many of the attendees at Davos). By lunchtime the consensus had shifted to complacency from crisis and the new thought-leader of Davos had become a figure with precisely the opposite views to Mr Soros – and, reassuringly for those who wanted to share his optimistic world view, an even bigger bank account. The last requirement narrows down the possibilities quite substantially, even in the plutocratic environment of Davos. It is clear, therefore, that I am talking about that long-standing favourite of Davos, Bill Gates.

Mr Gates had the privilege of delivered the closing speech at Thursday’s plenary session at Davos. The sudden shift from pessimism to optimism in the mood of the audience was evident from the way that the technical (and rather tedious) discussion of sub-prime lending and moral hazard between the presidents of the European Central Bank and JP Morgan was suddenly interrupted by the Gates fan club which trooped into the plenary hall in such a noisy manner that further discussion of central banking and financial crises immediately had to stop.

Instead Mr Gates rose to the stage for what he described as the “most important speech I will deliver this year”. The subject of the speech turned out to be a new economic philosophy which he had invented and titled “creative capitalism”. The essence of this new ideology was to harness the power of market forces to serve the needs of the poor, as well as the rich. Mr Gates descreibed himself as an optimist, who believed that all humans problems could be solved – or at least ameliorated - by the interaction of capitalism, technology and science. But he added “I’m an impatient optimist – and I realise that market forces are wonderful at serving the needs of the rich, of people with money. But “people benefit in inverse proportion to their needs”. The market system insures for example that “diseases like malaria, which kills a million people every year, get less attention from pharma companies than drugs for baldness. As people’s wealth falls, the market incentive to serve their needs also falls – eventually to zero. “

Luckily Mr Gates has come up with a solution. “I call this idea creative capitalism. A new system with the twin mission making profits and improving lives of those who don’t benefit from market forces.” How does this work?

Governments businesses and non-profits would work together to create new technologies and design new products specifically for the poor, which could be made available to people with very little money and to areas which could not, for example, rely on continuous electricity supplies. Even if these were not profitable, the companies involved would be paid through “reputational benefit” instead of money. This seemed a brilliant idea and everyone enthusiastically applauded. There was only one problem with the Gates theory: The best example anyone has come up with so far of this kind of technologyical innovation is the $100 solar-powered laptop which was launched by a consortium of high-tech companies last year. There was on.ly one problem with this classic paradigm of “creative capitalism”. It did not include Microsoft Windows. Mr Gates and Microsoft had accordingly used their formidable wealth and lobbying power with Third World World governments to kill this product stone dead since it was launched a year ago – appropriately enough at Davos.

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