Almost a year ago I wrote an article on the possibility that food and energy shortages could foment social unrest in the US. (“How Far is the US From Food Shortages and Food Riots?”) A few folk called me nuts. One said it would never happen, and, indeed, I pray that he is right. However, the paranoiac in me knows that it doesn’t take much for human beings to lose that thin veneer of civilization, that some of us possess and start embarrassing the apes, to which some maintain we are related.
Europe is already seeing unrest, and many European leaders are worried about the fallout from the high energy prices and skyrocketing food prices. France’s Minister of Finance said as much to the BBC, noting that the world’s leadership needs to send a reassuring message to their citizens.
Christine Lagarde said trust in the financial system needed to be restored. Leaders needed to send a clear, understandable signal to ordinary people about how governments were intending to act, she added. (BBC, 1-31-09)
Talk is cheap, and a lot of people aren’t being bought off by fancy words and token promises. The proof is in the pudding and they see reality every time they go to the grocery store and pay ever-increasing prices for basic staples. They see it at the gas pump, every time the energy bandits twitch an eyebrow and raise gasoline prices.
Platitudes do not an energy policy make: empty words don’t fill hungry stomachs. Hungry people can become angry people in a New York minute.
Minister Lagarde nailed it when she warned of the dangers of protectionism. "We're facing two major risks: one is social unrest and the second is protectionism," she told reporters. (Ibid)
The temptation to “fort up,” and roll up the drawbridges, erecting trade barriers to foreign countries is very strong right now. In the United States, protectionists are calling for the repeal of NAFTA, claiming, among other things, that
NAFTA was the marriage of an economic giant to two smaller players, one of them vast and poorly populated but on par economically, the other populous and impoverished. The U.S. economy is 10 times the size of Mexico’s and 11 times Canada’s. And the United States has two-and-a-half times Mexico’s population and eight times Canada’s. The point was never to truly merge the three into a common society, critics say, but to solidify Mexico’s position as a source of cheap labor for U.S. corporations. (Don McIntosh, “Critics say NAFTA's 10-year record validates dire predictions,” Northwest Labor Press)
On the other hand, many say that critics are right—half right, in the sense that every problem with the US economy cannot be laid at NAFTA’s door. Critics rightly point out that NAFTA's economic benefits were oversold, but they're wrong to heap the blame for all America's woes on it. NAFTA, which expanded the existing Canadian-U.S. free-trade area to Mexico, has had only a marginal effect on the U.S. economy. Yes, exports to Mexico have more than tripled since 1993 -- but at $161 billion last year, they still account for only 1.1 percent of the economy. Considering that total U.S. exports have more than doubled over the same period, to more than $1.6 trillion a year, the boost from NAFTA is just a trifle. (Philip Lagrante, “5 Myths About NAFTA,” Washington Post, 4-8-08)
Unfortunately, the man in the street doesn’t see the benefits of the exports. All he knows is that his job was eliminated and his company picked up its toys, left town and set up shop in Mexico, throwing him and hundreds of his co-workers out of work.
The fact is, NAFTA has had only a fractional impact on these trends. Mexico's biggest impact on the U.S. labor market is not through trade, but through immigration. And the money that Mexican migrants send home contributes more to the Mexican economy than foreign direct investment does. (Ibid)
The average American, French worker, or British citizen doesn’t care about how much increased trade their particular countries have. All they are worried about is whether their job is secure, if they can put food on the table, keep a roof over their head and maintain their standard of living. When the world economy shrinks and jobs evaporate, people could care less about “trade.” All they are interested in is keeping their stomachs full, their homes heated and their vehicles fueled. When something happens that they can not do those things, people get anxious, angry, and often take their frustrations out in nativistic outbreaks of ethnic cleansing, rioting and social unrest. This is the very danger that many countries face now. Their citizens are angry, often fearful of their jobs, and are looking for a scapegoat. They are finding scapegoats in undocumented workers, foreigners, and in ethnic and religious minorities. A Polish writer in Europe says, “The economic downturn is beginning to reveal underlying resentment of immigration. Poles were all very good when they worked hard (and were praised for their work ethic) and paid their taxes. But during the hard times, our situation gets really nasty.” Click here.
The “nastiness” isn’t always something that one can fight, either as an ethnic minority, or as a person working with ethic minority people in a business relationship. A Polish writer relates an experience with a friend, which is a prime example of what many ethnic minorities experience on the job:
A Polish friend of mine just called me and with a trembling voice told me what she overheard in a shop while trying on some clothes. A Brit was confiding in the shop assistant that he had lost his job. His wife, an equality manager in a big company, came back from her office the other day, clearly disturbed and shocked, and said that she was told by her boss that she would be sacked if she kept taking care of "those eastern Europeans". Her boss explicitly informed her that he did not give a damn about equality of opportunity if it concerned immigrants from eastern (sic) Europe and she had better understand that. (Ibid)
The writer notes that, while people may “know their rights,” they are often not in a position to exercise those rights. From a broader perspective, when the economy contracts, there is so much fear, that civil rights take a back seat to jingoism and job security.
On Saturday, hundreds of people demonstrated in Geneva and Davos to protest against the World Economic Forum. Carrying banners reading "you are the crisis" and throwing snowballs at security guards, the demonstrators said those at the forum were not qualified to fix the world's problems.
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