Yes, it's official. Today, Davos held its first-ever Global Town Meeting. For three hours, the assembled movers and shakers put aside the weighty business of debating pressing economic issues or holding impromptu "corridor summits" with their fellow leaders. Instead, they sat down in one overflowing room (an unlucky minority was relegated to satellite studios) to brainstorm with one another about what values should infuse global governance. The most popular answers: honesty, transparency, compassion, fairness and tolerance of diversity. Then, by a show of digital hands, they voted on the top dozen issues that should command their attention over the coming year. By a two-thirds majority, poverty was the winner. Something called "equitable globalization" was ranked second, while global warming and climate change placed third. Peace in the Middle East came in fourth, garnering half the august body's votes. "Managing the United States" was No. 10, with a mere 24 percent believing that America was the world's biggest problem.

Given the abysmal reputation that the United States enjoys in Europe these days, and much of the rest of the world, that's surprising. Nor would you have guessed such a low ranking for "U.S. containment" from the non-official buzz over morning coffee or late-night brandies by the fire. Two years ago, the informal table talk was Iraq: would the U.S. invade or not, and when. Last year brought a scarcely disguised anti-Americanism--and (let it be said) no small glee at the troubles U.S. forces were encountering in Baghdad. But this year brings a new concern: Iran. And once again, the question is: will the U.S. invade, and, if so, when?

The latest cover story for the German newsweekly Der Spiegel says it all. It features a smiling George W. Bush giving the world a cocky "thumbs up"--widely interpreted in Europe as a "screw you"--accompanied by the headline: HIS NEXT WAR. And so goes the anxious chatter in Davos. Bush's Inaugural Address may have inspired many Americans with its lofty rhetoric about liberty and freedom. But it alarmed the rest of the world. Vice President Dick Cheney's subsequent remarks--hoping for a diplomatic solution to Iran's nuclear ambitions and adding that the "United States does not want war"--was scarcely reassuring. Roland Schatz, a media analyst from Bonn who spends his days poring over European newspapers for clues as to what people are thinking, estimates that 70 percent of Germans think the United States will soon go to war with Iran, either by bombing or mounting a full-scale invasion.

James Hoge, editor of the New York-based journal Foreign Affairs, says the fears are absurd. "It's not going to happen," he says. And yet, an informal poll by NEWSWEEK at opening reception of the Davos conference suggests that much of the world isn't so sure. When a Saudi pharmaceuticals executive agrees with Hoge, saying, "This administration is not crazy," his German wife quickly chimes in. "Oh yes, it is," she says, vehemently comparing Bush to Hitler. A British journalist lays odds on it: "They'll bomb Iran within two years, 70 percent chance," he says. His Argentine colleague offers a caveat: "It depends on Iraq," he says. "Once that's under control, Iran is next." An editor of Davoser Zeitung says that "at least" half of all Swiss believe Bush will attack Iran. "America frightens me," confesses a Latin American hedge-fund manager. He rates the prospect of war with Iran at better than 50-50. "Bush has defined his enemy," he says. Out of 20 or so interviews, only a Swedish woman dismisses the possibility. "It would be suicide," she says. "[Bush is] not crazy."

Ironically, while Bush pursues his global war on terror, note this: when Davosians ranked their challenges for the coming year, terror wasn't even on the list.

Perhaps it's no wonder that the world's rich and powerful would prefer to talk about global poverty. The prevailing sense is that America is beyond control; it will pursue its interests as it sees them, regardless of what the rest of the world might think. That perception may be exaggerated--but it's real, to the extraordinary extent that global leaders actually think they have a better chance of alleviating world poverty than in managing (or moderating) the world's superpower.

Thus when they do actually get around to talking about economics--this is the World Economic Forum, after all--the conversation has less to do with how to spark European growth than, say, predicting whether or not the United States will pull them out of recession and whether the problems of the dollar will hurt or help. Attendees are also looking to spot the next economic bubble, with a session scheduled for Thursday on this topic being the first to fill up. Five years after the dot-com bubble burst, money is still cheap enough to drive up asset prices. Yale economist Robert Shiller thinks U.S. stocks are still unrealistically high. The prospect of a real-estate bubble in the most glamorous pockets of the world, from London to Los Angeles, is top on many people's minds.

But the underlying cause and main complaint is numbingly familiar. The United States is still running a whopping current-account deficit that cannot last. Americans consume like crazy, and the world keeps providing the money to fund them. In the words of one panelist, interest rates have been so low that Americans treat their homes as one giant ATM machine, refinancing so they can buy DVD players and the like from China, which in turn is buying U.S. Treasuries to keep the value of the yuan fixed to the dollar and therefore keep those players affordable. "This is an utterly insane way to run the world economy," says Morgan Stanley economist Steve Roach.

A big correction in the imbalances, predicted so dourly last year by a handful of doomsayers, still hasn't happened. Dripping with irony, one economist noted that "we are living in a perfect world." The global economy grew nearly 5 percent last year, the highest in three decades. Inflation was contained, and interest rates have held fairly steady. Yet if it appears perfect, it is because the pain of a correction is simply being postponed.

So far, the dollar is taking the brunt of any correction. Delegates in conversations seem to agree that it still has farther to fall. But 2005 could be the true test of what will happen when U.S. interest rates rise in real terms. So far, the Federal Reserve has only brought interest rates up in line with inflation. When money begins to have a real cost, economists say, we will see whether those Americans will keep the global economy growing. If no one else steps to the plate--think Europe--we're in for a rough ride.

Opinions on Europe are less clear-cut this year. The conventional wisdom continues to be that the Continent is stuck in its rigid ways, and the rising euro will only exacerbate the difficulty of getting the export-led economy to grow. But when one panelist reviewed those problems at an economics session, many European heads were shaking in the audience. "That is far too negative," grumbles a Swiss banker. For the first time in a decade, even Roach has some nice things to say about Europe. He sees signs of hope in recent efforts to make the labor market more flexible, and expects to see some follow-through in productivity from investments in information technology. This is exactly the argument delegates will hear from European Commission President Jose Manuel Barroso on Saturday.

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