Could Anti-Austerity Fever Spread To America?

Nearly 60% of Americans have an unfavorable opinion of the Republican Party, even worse than when they were at the height of impeachment fever-- and even worse than the 51% of people with an unfavorable view of the Tea Party movement. The GOP's 59% unfavorable ranking, is the highest since the CNN/Gallup Poll started asking the question in 1992.

Also interesting in this poll is that only 41% of Americans think their own congressmember deserves to be reelected. Only 25% think "most Members of Congress" should be reelected-- higher than usual but not really new news-- but it is significant that ire towards Congress is focussing on voters' own representative. Many people do not understand the details of the SatanSandwich but they understand that their congressmember voted against their interests and against the country's interests. This lack of support for their own Representative is the lowest since polling began-- by far. And it shows considerably more antipathy towards Republicans than towards Democrats. 58% (57% of registered voters) of Americans think congressional Democrats do not deserve reelection and 64% (65% of registered voters) think congressional Republicans do not deserve reelection. It could be a lot worse if our political elites continue down the same death-march path they're headed.

Yesterday we saw anti-Austerity riots break out all over Chile and, despite a violent and massive crackdown, continue to spread to every corner of England. Yes, the U.K. riots ARE anti-Austerity riots, not, as the Conservative Establishment would have you believe, "gang violence." Watch a highly biased BBC anchor have a journalistic meltdown (Monday) when she was interviewing someone who didn't fit in with her Conservative Consensus mindset:



Much easier to just repeat David Cameron's assertion that the protesters are nothing but mindless gang thugs and hooligans. There is another way of looking at it though, one that takes us back to the verge of the 1848 revolutions that swept Europe:

Many residents of the diverse borough of Hackney said it was this ever widening and very visible gap between the rich and poor that has exacerbated tension in recent years, especially as government cuts to welfare payments have started to bite.

Britain, one of the world's major economies, has a bigger gap between rich and poor than more than three-quarters of other Organisation for Economic Cooperation and Development (OECD) countries, according to a 2008 report. Charities in Britain say that inequality is most keenly felt in London.

"It's us versus them, the police, the system," said an unemployed man of Kurdish origin in his early 20s, sitting at the entrance to a Hackney housing estate with four Afro-Caribbean friends who nodded in agreement.

"They call it looting and criminality. It's not that. There's a real hatred against the system," he added, listing what he saw as the police prejudice, discrimination and lack of opportunity that led him and his friends to loot shops, torch bins and hurl missiles at police Monday.

"There's two worlds in this borough. More and more middle classes are coming and we're being pushed out. The shops are pricing stuff like it's the West End, we can't afford the rents. We're the outcasts, we're not wanted any more.

"There's nothing for us."

Those who were out on the streets Monday night, and those who had gathered amid the debris Tuesday morning, said there was no interaction between the two distinct communities, even though they live practically on top of each other.

The rioting in Hackney was the third night of violence across the capital, sparked by the fatal shooting by police of a man in another poor borough.

"Youths are frustrated, they want all the nice clothes. They ain't got no money, they don't have jobs," a 41-year-old youth worker told Reuters, stood outside the Pembury estate, the scene of much of the trouble Monday night and home to mostly young black people.

"To live, to have money in their pocket, they have to thieve, they have to rob.

"The people that run this country, they got money, they are rich, they got nice houses. They don't care about poor people."

"SCREWING THE SYSTEM"

The statistics confirm the problem.

In 2007 Hackney was ranked the second most deprived local authority in England, behind Liverpool. More than 10 percent are unemployed. Some 11,000 people rely on state benefits to live, meaning some 24 people are competing for every available job.

According to the council, Hackney is ranked sixth out of the 32 London boroughs in terms of crime.

At the same time, small one-bedroom flats regularly cost some 300,000 pounds. On a nearby street, smart cafes are full of young families attracted to the parks and transport links to the nearby financial district. Pricey organic food shops stand next to 'pound shops'-- where all the items cost one pound.

Professor Mike Hardy of the Institute of Community Cohesion said it was not just the division between rich and poor that caused the problem, but the fact they lived so closely together.

"There is a much greater visibility of the difference," he told Reuters. "In London, the current troubles are almost focussed entirely not on a cause or a protest, but on greed and personal want. 'I haven't got something and I can take it'."

Britain's coalition government has made deep spending cuts since coming into power last year to tackle a big budget deficit. The poor say they have been hit hardest, with people in Hackney pointing to the closure of many services.

"The only way we can get out of this is education, and we're not entitled to it, because of the cuts. Even for bricklaying you need a qualification and a waiting list for a course. I signed up in November, and still haven't heard back," the Kurdish man said.

The government has also raised university tuition fees since coming into power, putting a higher education further out of the reach of youths from places like Hackney.

"They're screwing the system so only white middle-class kids can get an education," said another man, who declined to be named. He said politicians were the real criminals, and pointed to a 2009 expenses scandal in which several lawmakers were revealed to have cheated the taxpayer out of thousands of pounds.

"The politicians say that we loot and rob. They are the original gangsters. They talk about copycat crimes. They're the ones that's looting, they're the originals," he said.

One of the Kurdish man's friends pointed to alleged payments made to the police by journalists, claims currently under investigation as part of a wider phone-hacking scandal centred on the now defunct News of the World newspaper, part of Rupert Murdoch's News Corp media conglomerate.

"Everyone's heard about the police taking bribes, the members of parliament stealing thousands with their expenses. They set the example. It's time to loot," the youth said.

Could that happen here?


UPDATE: THE GREAT SPLINTERING

Umair Haque, who studied neuroscience at McGill, is a London-based columnist to the Harvard Business Review, Director of the Havas Media Lab and author of The New Capitalist Manifesto: Building a Disruptively Better Business. His specialty as a consultant and as a writer is capitalism, particularly venture capitalism and start-ups. His column yesterday is worth reading in its entirety. Excerpts below:

London's become a city where many young people feel they're finished before they start. Global economic imbalances (think, crudely, a country with a perpetual trade deficit) ultimately mean that there aren't enough jobs to go around-- and entrepreneurship is about as British as fish and chips are American. Being lucky enough to land a job that propels you into the ranks of the upwardly mobile-- or at least, that keeps you from the ranks of downwardly mobile-- depends, in my experience, not just on having gone to a handful of top schools (Oxford, Cambridge, LSE), but on having the right accent, postcode, and background. And while Americans might say that's unique to Britain, I wonder if in most advanced economies, similar dynamics aren't at work. Top employers, for example, don't exactly recruit heavily from The University of Nowhere. Internships are heavily tilted towards the already-privileged. In fact, the problems of youth unemployment, underemployment, marginalization, and inequality are so pervasive globally, more and more economists are beginning to point to a lost generation.

Another storm cloud looming over the dreary isle is, of course, the grim specter of austerity. Of all advanced economies, the UK proudly passed perhaps the world's most severe shock and awe austerity package-- dramatic cuts across the board-- to the shock and disbelief of many economists, who predicted that it would throw thousands out of work and cripple demand in the middle of an already precarious economic situation at precisely the time the economy needed it least. The result has been predictable: even for a world beset by reluctant recoveries, the UK's "recovery" has been notably the poorest. Hence, an economy where too many are out of breath, struggling even to tread water. The evidence suggests austerity leads to social instability and violence: uh-oh. [...]

Our institutions are failing-- they're failing us; failing the challenge of igniting real, lasting human prosperity. If institutions are just instruments to fulfill social contracts, then ours are shattering because the social contracts at their hearts have fractured.

I call it a Great Splintering-- not purely an economic phenomenon, as in "Great Contraction," but a social one: an era when social contracts are being torn up, abrogated, betrayed, abandoned, by accident, by design, by "regulatory capture," or simply by polities too gridlocked to progress. Broken social contracts aren't just tidy abstractions, empty of visibly real consequences, disconnected from the noise and clamor of our messy human lives. As they break, yesterday's ways of living, working, and playing rupture; yesterday's organizations, from corporations to banks to nations, creak and crack.