Opinion Sur
In 2016, a spectrum haunts the white peaks of Davos: social protest against a dysfunctional and ill-formed globality. Which is the sign of this protest? Who is scared by the primary mobilization of those moving up and the secondary mobilization of those moving down?
Every year in January in the Swiss village of Davos the world elite gathers, consisting of a hard core of those who manage big corporations and the financial system, surrounded by a chorus of politicians, aspirants, publicists, scientists, accredited journalists, and some celebrities. In sum, it is an assembly of the powerful, the influential, and those aspiring to become one. As Hipolito Irigoyen would say it is the biggest “summitry”. This year, amen discussing latest news on communication and finance technology, a spectrum ran through the corridors causing concern and sometimes fears: peoples expressing their being sick and tired with the concentration of power and wealth, with the lack of opportunities, and with precarious employment. Protests multiply; they are expressed in populism with right and left signs and they threaten some countries to take to office certain leaders that “are not people like us.” This article aims at characterizing some of these currents.
Today’s great and increasing inequality in wealth has multiple perverse effects, including those that affect the viability of the very system that produces such concentration. In 2007, in the United States, 1% of the citizens had 34% of national wealth. The following 9% richer managed 38.5%, while 90% controlled the remaining third, 26.9%, as reported by the Federal Reserve. In 2016, inequality is even worse.
From an economic point of view, this situation raises the challenge of an unmanageable surplus by the established system of social relations. Too much production, on one side; weak demand, on the other. Some economists draw attention to the risk of a “secular stagnation.” The system can only continue functioning by raising its irrationality, such as with monetary stimuli to counteract a floor of interest considered very low, null, or even negative; sumptuary investment bubbles, public and private indebtedness, corruption and money-laundering, and the tendency to “buy” political systems— democratic or not—through extremely expensive political campaigns. Last but not least, there is military expense—weapons and deterrence and destruction devices that are much more efficient in “burning surplus” than in dissuading a subversive violence that abounds in a capillary and asymmetric way. But they directly or indirectly generate employment and feed an entire industry of death, vigilance, and persecution in an abstract and endless “war.” We are already living in a world of rigorous surveillance.
With the end of the Cold War and the abdication of socialist systems—from the collapse of Soviet communism to China’s conversion towards a state-steered capitalism—the globalized late capitalism, with all its contradictions, does not have an external rival anymore, an “Other” that confronts and threatens it and who, in that way, could discipline it and force it to make concessions, under penalty of losing points in the global geopolitical game board. However, this absolute power generates its own nemesis. It is a machine that works at full speed but without brakes.
The main beneficiaries—a miniscule group in demographic terms but trillion-rich in capital—care for the short term, with delaying tactics and some minor cosmetic reforms. Socially, they are so isolated from common life that they turn a deaf ear to the growing outcry of those who, group after group, are left behind or left out. Their reaction to social protest is similar to that of Marie Antoinette. “If they do not have bread, let them eat cake.” They prefer to note the progresses in the living standard of huge Asian masses, mobilized during the last decades as an urban industrial proletariat with low incomes though higher than the miserable level they were accustomed to in rural areas.
This process of primitive accumulation for the sake a model of exporting industrialization represents an unprecedented socio productive integration without precedent in history. This growth model has produced deindustrialization at the center and industrialization at the periphery. The model, called “Chimerica” during its splendor, has reached its limits. For example, China is currently focused on a new revolution: nothing less than a gigantic “export substitution” (to revert Raul Prebisch’s expression) and a social adjustment in pursuit of a service society and a better level of life. It seeks to forge a true and new middle class, with a large internal market for its production and an increase in the scale of value added through lower investment in cement and a higher investment in knowledge, information, and communications. In summary, a strategy—still a long term strategy—that aims at transforming for good an ancient civilization into a vanguard nation.
It is possible that a future increase in Chinese demand will turn the country again into a growth locomotive in the world economy, but we would need to wait for China to first complete its projected internal social reconversion. By that time, Chinese resurgence would have caused geopolitical frictions with neighboring countries and with the declining but still huge power of the United States.
The problem the world is facing today and that has already knocked on Davos’ doors is the following: if public policies in developed countries do not change from mere short-term monetary remedies to a medium- and long-term investment strategy in infrastructure, education, and more participation of the population in the new public and private sources of employment, the elites will have to address an economic stagnation, distributive struggles, monetary wars and populist movements, and everything in crescendo. That is the real fear of the global elite in its snow peak in January.
To understand the social dimension of the economic and geopolitical processes that I have just mentioned, I was able to count on Latin American sociological sources, whose intellectual father (at least in the Southern Cone) was Gino Germani. In the 60s this famous Italian-Argentinean sociologist presented a highly suggestive thesis of modernization. Faced with the problem of how to characterize Peronism in Argentina (phenomenon that many Western observers equated with the European fascism), Germani formulated a distinction between primary and secondary social mobilization. Gino Germani was one of the first ones to argue that Peronism was a phenomenon different from European fascism. Germani’s argument was that such political experience had been a multi-class movement based on the alliance between the new industrial bourgeoisie, the old and new proletariat, and the military, whose main accomplishment was to incorporate lower classes in national political life. Thus, the composition and the goals of Peronism make it a phenomenon different from fascism.
The social mobilization enters into play when old commitments disintegrate as well as social, psychological, and political loyalties that make different sectors of the population available to access new ways of behavior. However, it is important to stress the distinction that Germani held between primary and secondary mobilizations. Secondary mobilization frequently occurs as a reaction to the primary mobilization of sectors once excluded or marginalized. For example, when old middle classes already incorporated into the social and political system feel threatened by the advancement of other groups (immigrants, minorities, and so on) or are affected by a prolonged economic crisis that carries a downward social mobility for them, they get mobilized against the existing system and its new arrivers. In this case, their populism is, according to Germani, fascist in character. Fascism would be in this case a reactionary movement that has turned popular.
During a crisis where ideological clarity is lost, social mobilization promotes odd pairings and strange bedfellows. It is as comprehensible as it is unfortunate. Not so long ago, the 2008 financial collapse would have produced a massive street mobilization of left-wing parties, in particular the European Marxists. For these movements, revolution seemed to be within reach and their parties ready for power. But the XXI century, at least in the beginning, has lost the appetite for a radical and secular change. The failure of the Soviet system brought with it the international discredit of socialism, except for some so-called progressive Latin American bastions. In other latitudes, enthusiasm was succeeded by apathy, in others, protest, though violent, became retrograde, traditionalist, or religious. But eight years have passed since a crisis that seemed terminal at one point, but from which the system “saved” itself with some emergency measures and from not having an organized opposition.
Today these cosmetic solutions—the proverbial rabbits that the magician pulls out of his hat—are now exhausted. Elites do not ignore what they should do to save the system, but either they cannot or they do not dare to. For example, The European Union does not know how to carry a rational and consensual policy to regulate the refugee flow. In the United States, for convenience they allowed a flow of undocumented immigrants that is equivalent of today’s entire Chilean population. Obama’s lukewarm attempts to regulate that mass of residents and to rationalize the frontiers have been systematically torpedoed by the right-wing opposition. Another example: It is crystal clear that the European austerity policy was a complete failure. As I have point out in other articles, it is a macro-economic, pro-cyclical, and socially harmful policy. But the technocratic elite in Brussels stubbornly advocates that “in the long run” it will work, without remembering that famous quote by John M. Keynes “in the long run we are all dead.” A third evident example is the need to end the excessive financialization of the economy and control the financial and banking sectors. But who dares to taunt this beast when it has managed to have the politicians on its payroll? And the same can be said regarding the need to maintain enterprises competitive, when the corruption of monopoly has spread everywhere. And not to mention establishing a taxing system that increases the contributions of the rich and powerful, that today not only protect themselves through their “lobbies” but also have convinced the common taxpayer that rejecting the increase in taxes is a “patriotic act” for themselves as well. In summary: the reformist solution of the system is practically doable but politically impossible. It is like a steam boiler without an escape valve preparing for its explosion.
For their inaction, the elite can just contemplate a general but varied protest, without rational organization and that mixes issues that previously separated the left from the right. This confusion feeds from the secondary mobilization of the unemployed youth as well as from the old declining middle class. In the XX century, a similar situation fed fascist movements in Europe. We shall see how the same broth is brewed today. To prove a point: see how protest spreads throughout Europe.
Leftist political movements in Greece, Spain, and England; that is, such parties as Syriza in Greece, Podemos in Spain, and Corbyn’s Labour party in United Kingdom, preach the nationalization of industry and commerce control. But at the same time, the extreme French right, gathered around Marine Le Pen’s National Front, raises the same flags, adding a xenophobic and racist trait. With political astuteness, it makes an annual festival on May 1st, traditionally a communist holiday in France. But today many old communists vote for the right. They are against globalization, that has closed industries, and immigration, that brings “disloyal” labor competition. In Hungary, the right-wing government proposes to nationalize banks. The same thing happens in Poland with its newly elected right-wing government, that preaches a new economic nationalism. In England, the foxy Nigel Farage, from the UKIP party, advocates increasing welfare expenditures while closing frontiers. In sum: issues from the old socialist left reemerge, but this time under a national flag. Is it patriotic neo-socialism or old-fashioned national-socialism? Faced with this specter, the global elite one day soon will long for the comfortable opposition of its old class enemies.
