Capitalism and its critics: Rage against the machine
Rage against the machine
People are right to be angry. But it is also right to be worried about where populism could take politics
FROM Seattle to Sydney, protesters have taken to the streets. Whether they are inspired by the Occupy Wall Street movement in New York or by the indignados in Madrid, they burn with dissatisfaction about the state of the economy, about the unfair way that the poor are paying for the sins of rich bankers, and in some cases about capitalism itself.
In the past it was easy for Western politicians and economic liberals to dismiss such outpourings of fury as a misguided fringe. In Seattle, for instance, the last big protests (against the World Trade Organisation, in 1999) looked mindless. If they had a goal, it was selfish—an attempt to impoverish the emerging world through protectionism. This time too, some things are familiar: the odd bit of violence, a lot of incoherent ranting and plenty of inconsistency (see article). The protesters have different aims in different countries. Higher taxes for the rich and a loathing of financiers is the closest thing to a common denominator, though in America polls show that popular rage against government eclipses that against Wall Street.
Yet even if the protests are small and muddled, it is dangerous to dismiss the broader rage that exists across the West. There are legitimate deep-seated grievances. Young people—and not just those on the streets—are likely to face higher taxes, less generous benefits and longer working lives than their parents. More immediately, houses are expensive, credit hard to get and jobs scarce—not just in old manufacturing industries but in the ritzier services that attract increasingly debt-laden graduates. In America 17.1% of those below 25 are out of work. Across the European Union, youth unemployment averages 20.9%. In Spain it is a staggering 46.2%. Only in Germany, the Netherlands and Austria is the rate in single digits.
It is not just the young who feel squeezed. The middle-aged face falling real wages and diminished pension rights. And the elderly are seeing inflation eat away the value of their savings; in Britain prices are rising by 5.2% but bank deposits yield less than 1%. In the meantime, bankers are back to huge bonuses…