On first thought, it would be easy to dismiss the ongoing protests by a motley lot near Wall Street for the last three weeks as an eccentric, yet ambitious, effort to draw attention to the fallout of growing inequality in a weakening US economy.
They neither had the numbers nor the desired firepower to gain the nation’s eyeballs on a sustained basis. All this may have changed last week when, first, local unions threw their lot behind them; a few days later, Bernie Sanders, the independent US senator from Vermont, who has been campaigning against inequality, also endorsed the protests and appealed to the political establishment to respond to their demands.
It may yet be the turning point, wherein US politics, especially with the presidential elections a year away, would be forced to address the agitation—and if news of its gradual spread to other parts of the country are indeed true. If this does pan out, then, once again, a local and unorganized protest would have gained unprecedented traction nationally.
Gaining momentum: ‘Occupy Wall Street’ protesters at a march from Washington Square Park to Zuccotti Park, in New York on Saturday. Photo: Henny Ray Abrams/AP
This is uncannily similar to the protests organized by Anna Hazare against corruption. Initially confined to a corner of Jantar Mantar—the epicentre of civic protests in New Delhi—it rapidly transformed into a national initiative across Indian cities. The second round of protests was even more impressive, and the Union government buckled even faster. While Hazare was steadfast in his cause against corruption, it was evident that he had emerged as the lightning rod for the disaffected—many of whom are reeling under rapidly worsening inequality, belied aspirations and joblessness—in the country.
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Last month, villagers in Guangdong province of China came out in protest against what they claim was illegal acquisition of farmland by the local government. While it is not clear how the authorities would respond, growing inequality has emerged as a recent policy challenge in China. Similarly, a key aspect driving the protests that have brought about regime changes in some Arab countries this year has been the desire of the people for a better quality of life.
Connecting these dots reveals that there is a globalization of discontent.
It is unprecedented.
Some attribute it to the prevalence of social media, like Twitter and Facebook. But it may have something to do with what Nandan Nilekani, chief of the Unique Identification Authority of India (UIDAI), famously argued: The world is flat. A phenomenon wherein more countries are in with an opportunity to exploit rapidly expanding global trade opportunities than ever before. Since money talks, it is inevitable that the domination of the global order by a few Western nations, too, would see a shake-up.
While much of this has panned out, what seems to be unravelling at present is the second phase of globalization. While, indeed, it provided an opportunity for new countries to join the global high table, it has also spawned problems in its wake, which now seem to be coming to a head.
It has stoked aspirations among all, but, unfortunately, not equipped everyone equally to exploit the opportunity. So whether they be countries—such as low income countries—or people, vast sections have tended to be left out of the process. Not only has this worsened inequality, it has gradually built up a reservoir of discontent among people. Further, the skewed income distribution has resulted in the concentration of demand.
In an interview to Mint published on 24 December 2008, Nobel laureate Joseph Stiglitz said, “One of the reasons the economy is weak today, I think, is the lack of aggregate demand. This in part is due to the growing inequality in our society. One natural response to this problem is to say, let’s try to redistribute income to those who are less well off. Let’s try to design policies that create more equality, and that will not only be consistent with principles of social justice, but will actually stimulate the economy.”
Three years later, it is clear this message has largely been ignored and, consequently, the inherent contradictions in the growth process are beginning to catch up. Part of the problem is that most planners believe this is the usual cyclical process and things would clear up. Stiglitz and his ilk are arguing that the present upheavals in the global economy are structural in nature and, hence, there is unlikely to be an immediate recovery—some even predict a decade or more of low or near zero growth.
The globalization of discontent suggests that policy wonks will not have the usual luxury of waiting out. The agitations, often spontaneous sparks, are beginning to acquire a life of their own. And, ironically, the fight—against inequality and for more jobs, as in the case of India—is not being inspired by the organized Left parties, whose ideology is premised on such issues. Instead, the push for change in status quo is coming from below and elements aligned more to the political centre. It has already shaken the Indian polity at its foundations, will the US be next?
Anil Padmanabhan is a deputy managing editor of Mint and writes every week on the intersection of politics and economics. Comments are welcome at email@example.com