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World of Resistance Report: Financial Institutions Fear Global Revolution

World of Resistance Report: Financial Institutions Fear Global Revolution

By: Andrew Gavin Marshall

11 July 2014

Originally posted at Occupy.com

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In Part 1 of the WoR Report, I examined Zbigniew Brzezinski’s warnings to elites around the world of the “global political awakening” of humanity. In Part 2, I looked at the relationship between inequality and social instability, and in Part 3 I examined the World Economic Forum’s warnings of growing inequality and the “lost generation” of youth who pose the greatest threat to oligarchic interests around the world. In this fourth installment in the series, we turn to reports from top banks and financial institutions warning about the growing threats to their interests posed by an increasingly disenfranchised and impoverished population – manifested in protests, strikes and social unrest.

In November of 2011, Bob Diamond, the CEO of one of the world’s largest banks, Barclays, stated in a speech: “We’ve seen violent protests in Greece, public sector strikes across Europe, [and] anti-capitalist demonstrations that started on Wall Street have spread to other places around the world.” Diamond added: “Young people have been especially hit hard by high levels of unemployment. The threat of further social unrest remains if we don’t work together to generate stronger economic growth and more jobs.”

A March 2013 report by senior economic adviser George Magnus of UBS Investment Research, entitled “Social Unrest and Economic Stress: Europe’s Angst, and China’s Fear,” noted that “the wave of social unrest that rumbled across Europe between 2008 and 2011 has become less intense… [and] has come as a cause for relief in financial markets.” Yet, he wrote, the occasional upsurge in large-scale national and European-wide anti-austerity protests and strikes “signifies the deep malaise in the complex and fragile trust relationship between European citizens and their governments and institutions.” Since 2010, approximately 13 out of 19 E.U. governments had been voted out of office or had collapsed, indicating that “public anger… is far from dormant, and its expression is mostly unpredictable.”

Social unrest, added the UBS report, “is a systemic phenomenon” that is “highly uncertain, complex and ambiguous,” and which can lead “to the toppling of governments, or even political systems.” Social unrest across the E.U. “has been notable more for the public expression of lack of trust in the institutions of government, including in Brussels,” the headquarters of the European Union.

This “lull” in social unrest, warned Magnus, “is most likely deceptive.” The present problem in Europe “is the same” as the main problems in Europe of the 1930s – when mass poverty, unemployment and social unrest led to the rise of fascism. The underlying problem in both eras was “the inadequacy of mainstream, political channels to address rising public concern about the loss of economic security, social stability and, yes, cultural identity.”

Citing an OECD study, the bank report noted that “austerity has gone hand-in-hand with a variety of forms of social and political instability, and politically-motivated violence.” There have been “heightened levels of social unrest and shocks to the political system in Greece, Spain, Portugal and Italy… sometimes requiring the force of the state to suppress it.” These are especially important matters for banks to pay attention to, since the European debt crisis was caused primarily by the big banks – and the austerity and “structural reform” policies (along with the bailouts that accompanied them) were designed for the benefit of those banks as well. Thus, resistance to austerity and “reform” is, in effect, resistance to the bailouts for the big banks.

In May of 2013, JPMorgan Chase released a report, “The Euro Area Adjustment: About Halfway There,” which assessed “progress” in the European Union on the issue of austerity and structural reform. The “adjustment” of European society, claimed the report, was “about halfway done on average,” noting that the process would continue for much of the rest of the decade although it faced major challenges, including the development of “new institutions” in the E.U. and what the bank called “national legacy problems.” This vague term referred to “the constitutions and political settlements in the southern periphery [of the E.U.], put in place in the aftermath of the fall of fascism, [which] have a number of features which appear to be unsuited to further integration in the region.”

Just what does this mean? The bank explained that “fiscal austerity” was likely to be a major feature in the E.U. “for a very extended period.” However, if the European Monetary Union is to survive the coming decade, “deep seated political problems in the periphery… need to change.” But what precisely are these “deep seated problems”? The bank elaborated that many of the southern periphery states’ constitutions “tend to show a strong socialist influence,” referring to the fact that many constitutions guaranteed various social rights for populations, including labor, healthcare and educational and civil rights.

Further, the bank reported that many of these nations suffer from the following features: “Weak executives; weak central states relative to regions; constitutional protection of labor rights; consensus building systems… and the right to protest if unwelcome changes are made to the political status quo.” The translation: democracy itself is the problem. As such, JPMorgan noted, “the process of political reform has barely begun.” In other words, out with democracy and in with financial and corporate oligarchy.

The bank’s report also noted that there were a number of potential threats as the process of “political reform” advanced, including “the collapse of several reform minded governments in the European south,” a “collapse in support for the Euro or the E.U.,” the possibility of “an outright electoral victory for radical anti-European parties,” or perhaps even “the effective ungovernability of some Member States once social costs (particularly unemployment) pass a particular level.” JPMorgan Chase warned that while there wasn’t a current situation of “ungovernability” in E.U. states, the longer-term prospects were “hard to predict, and a more pronounced backlash to the current approach to crisis management cannot be excluded.”

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AXA, one of the world’s largest financial institutions and insurance companies, published a report in July of 2013 written by Manolis Davradakis, entitled “Emerging Unrest: Looking for a Pattern,” which expressed particular concerns and perspectives on the issue of social unrest. The report noted that emerging market economies “are currently experiencing a surge in political risk due to social unrest that is being fueled by reasons that differ from those that resulted in the Arab Spring.”

The “main cause” of unrest in emerging market nations was “the rise of the middle class,” as this portion of the population “realize that they continue to experience the same everyday problems as poorer population strata, namely a high crime rate, poor public services, and corruption.” The report cited examples of social unrest in Turkey and Brazil, warning that these countries could see their credit ratings cut if the social upheaval is “lasting.”

The AXA report referred to the multiple episodes of unrest across emerging market nations in the summer of 2013 as “riots,” stating that they had several points in common, namely that “they were sparked by a government decision affecting daily life” and that the protesters were “not affiliated with political parties or movements” but instead were “well educated members of the middle class.” These factors were reminiscent of the massive unrest that took place in the advanced economies during the 19th century when emerging middle classes were struggling “for better living standards and more representation in political governance.”

Beyond a certain point, warned AXA, “repressing mass demands for a more open society becomes costly and economically ineffective.” A government’s inability or lack of will “to acknowledge the people’s right to freedom of expression and a voice in decision-making is a source of social unrest.”

AXA devised a Poor Governance Index (PGI), analyzing seven key indicators that could lead to social unrest, and concluded that the potential for instability in the BRIC nations – Brazil, Russia, India and China – was quite high. It also cited increased potential for unrest in Egypt, Ukraine, Indonesia, South Africa, Tunisia and Turkey, warning that such unrest “may have implications for emerging market [credit] ratings.” It noted that several credit ratings agencies had already warned about the effects that “prolonged social unrest” could have on the ratings for Turkey and Brazil.

Going further, in July of 2013, Stephen D. King, chief economist of HSBC bank, warned that growing wealth gaps and increasing divisions between generations could result in youth uprisings similar to the Peasants Revolt of the Middle Ages. King commented: “I am intrigued at the moment that the youth are quite peaceful, and I wonder whether that might change. It is very difficult to predict but youth movements might become more focused on their own rights rather than the economy.”

In October of 2013, King wrote an op-ed for the New York Times in which he warned that as bad as things already were, “they are going to get much worse, for the United States and other advanced economies, in the years ahead,” writing that both sides of the North Atlantic region had “already succumbed to a Japan-style ‘lost decade’” in which “promises can no longer be met, mistrust spreads and markets malfunction.” King wrote that “facing the pain will not be easy,” especially as policy makers continue to “opt for the illusion” and “pray for a strong recovery… because the reality is too bleak to bear.”

The “bleak” reality is that these and other big banks and financial institutions have repeatedly collapsed the global economy and profited along the way, punishing entire societies and populations into poverty through a process of plundering and exploitation as governments feared the wrath of “financial markets.” The banks that are now bigger, more dangerous and more powerful than ever fear the growing discontent, unrest and resistance of populations – especially the youth. The world’s major financial institutions fear that the global economic system which they helped to create, and over which they rule, will ultimately come back to haunt them in the form of mass social unrest, potentially undermining their power and the system as a whole.

Andrew Gavin Marshall is a researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project, chair of the geopolitics division of The Hampton Institute, research director for Occupy.com’s Global Power Project and World of Resistance Report, and hosts a weekly podcast show with BoilingFrogsPost.

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World of Resistance [WoR] Report, Part 1: The Global Awakening

World of Resistance [WoR] Report, Part 1: The Global Awakening

By: Andrew Gavin Marshall

Originally posted at Occupy.com

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The world today is in the midst of the most monumental social, political and economic upheavals in human history – a state of continual protests, uprisings and what may be considered inevitable revolution on a global scale. Power that had been centralized for roughly 500 years among the Atlantic powers of Western Europe and North America is rapidly shifting to include the rise of the East, as China, India and others operating within established, institutional frameworks of power get wooed by the former Western imperial managers to become colluders in empire, instead of competition.

To add to this, global wealth and power is being centralized among a highly interconnected and transnational ruling class: a small global elite who own and operate the major banks, corporations, foundations, think tanks, universities and international organizations. It is this numerically minute group of plutocrats whom empire serves. Long established among the Western elites, this group of plutocrats is attempting to bring the oligarchies of other powerful and rising states firmly within its organizational and ideological structure.

Think of it as an established Mafia that helped build up a few other crime families in order to extend its influence – and which now has to contend with the increasing autonomy and competition that these strengthened crime families pose, as it attempts to bring them closer within the established ‘Family’ instead of risking an all-out Mafia war in which all parties would surely lose. The changing structures of global power, along with the ever-increasing unrest of populations around the world, has created perhaps the most challenging situation for any empire in human history.

Zbigniew Brzezinski has written and spoken for years on the issue, publishing in establishment journals and speaking at elite think tanks about what he calls the “Global Political Awakening.” Brzezinski is not a casual observer nor a resigned academic; he sits within the heart of the intellectual and institutional foundations of the American empire alongside other notable figures such as Henry Kissinger and Joseph Nye. Brzezinski was even recruited as a foreign policy adviser to the 2008 presidential campaign of Barack Obama, who referred to Brzezinski as “one of our most outstanding thinkers.”

Brzezinski wrote in 2005 that the United States needed to face “a centrally important new global reality: that the world’s population is experiencing a political awakening unprecedented in scope and intensity, with the result that the politics of populism are transforming the politics of power.” Thus, the “central challenge” for the U.S., noted Brzezinski, “is posed not by global terrorism, but rather by the intensifying turbulence caused by the phenomenon of global political awakening. That awakening is socially massive and politically radicalizing.”

In a 2004 speech to the elite-populated Carnegie Council, Brzezinski explained that the global awakening was partly “spurred by America’s impact on the world,” by virtue of the fact that America is able “to project itself outward” and “transform the world,” creating an “unsettling impact, because we are economically intrusive, [and] culturally seductive.” In other words, American imperialism is – by its very nature – creating its antithesis: the global awakening.

The awakening “is also fueled by globalization,” Brzezinski further explained, “which the United States propounds, favors and projects by virtue of being a globally outward-thrusting society.” The process of globalization, however, “also contributes to instability, and is beginning to create something altogether new: namely, some new ideological or doctrinal challenge which might fill the void created by the disappearance of communism.”

In other words, since the end of the Cold War, when Marxism and Communism represented the largest and most organized global ideological challenge to Western state-capitalist democracy, Brzezinski maintains there has been an ideological vacuum in terms of ideas opposing the present global order. The global awakening, however, is changing the circumstances. As he stated: “I see the beginnings, in writings and stirrings, of the making of a doctrine which combines anti-Americanism with anti-globalization, and the two could become a powerful force in a world that is very unequal and turbulent.”

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Brzezinski noted in 2005 that, “the population of much of the developing world is politically stirring and in many places seething with unrest,” having become “acutely conscious of social injustice to an unprecedented degree, and often resentful of its perceived lack of political dignity.” A “community of shared perceptions” was being created by the spread of radio, television and Internet access, creating the potential for energies to be galvanized which “transcend sovereign borders and pose a challenge both to existing states as well as to the existing global hierarchy, on top of which America still perches.”

The youth of the Third World represent “a demographic revolution,” and being “particularly restless and resentful,” they also represent “a political time-bomb… creating a huge mass of impatient young people.” The “potential revolutionary spearhead” of the Third World youth was, in Brzezinski’s view, “likely to emerge from among the scores of millions of students” concentrated in the educational institutions of the developing world. Having largely originated from “the socially insecure lower middle class and inflamed by a sense of social outrage, these millions of students are revolutionaries-in-waiting… connected by the Internet… Their physical energy and emotional frustration is just waiting to be triggered by a cause, or a faith, or a hatred.”

In 2008, Brzezinski wrote in the New York Times that “global activism is generating a surge in the quest for cultural respect and economic opportunity in a world scarred by memories of colonial or imperial domination.” In his view, the necessary course of action “is to regain U.S. global legitimacy by spearheading a collective effort for a more inclusive system of global management.” Brzezinski noted, in a speech he gave that same year to Chatham House, that “in the current post-colonial era, it is too costly to undertake colonial wars” which is why the U.S. should attempt to avoid getting further “bogged down” in the Middle East and Central Asia, where America would be “engaged in a protracted post-imperial war in the post-colonial age, a war not easy to win against aroused populations.”

Later, in a 2010 speech to the Canadian International Council (CIC), an elite think tank based in Canada, Brzezinski explained the “total new reality” of the awakening of mankind, explaining that “most people know what is generally going on… in the world, and are consciously aware of global iniquities, inequalities, lack of respect, exploitation. Mankind is now politically awakened and stirring.”

In a 2012 speech at the European Forum for New Ideas (EFNI), Brzezinski stated that 20 years following the end of the Cold War, “a truly comprehensive American global domination is no longer possible [because] in recent decades, worldwide social change has experienced unprecedented historical acceleration, particularly because instant mass communications… cumulatively have been stimulating a universal awakening of mass political consciousness.”

“The resulting widespread rise in worldwide populist activism is proving inimical to external domination of the kind that prevailed in the age of colonialism and imperialism,” he continued. “Persistent and highly motivated populist resistance of politically awakened and historically resentful peoples to external control has proven to be increasingly difficult to suppress, as protracted guerrilla warfare in Vietnam, Algeria, or Afghanistan have amply demonstrated; and as the rising turmoil in both the Middle East and Southwest Asia are foreshadowing.” (“The Role of the West in the Complex Post-Hegemonic World,” Speech at the European Forum for New Ideas, 26 September 2012)

As Brzezinski explained to his fellow elites and imperialists in the United States and other powerful Western societies: “The worldwide yearning for human dignity is the central challenge inherent in the phenomenon of global political awakening.” As he stated at Chatham House in 2008, the world’s major powers, “new and old, also face a novel reality: while the lethality of their military might is greater than ever, their capacity to impose control over the politically awakened masses of the world is at a historic low. To put it bluntly: in earlier times, it was easier to control one million people than to physically kill one million people; today, it is infinitely easier to kill one million people than to control one million people.”

Institutional and imperial power structures have never been more globalized or concentrated in human history; yet, simultaneously, never have they been under more threat from an awakened humanity. We have unprecedented access to information and communication; never have we had a greater opportunity to transform the world for the better and to challenge – or make obsolete – the prevailing global power structures.

Yet, simultaneously, never has humanity – collectively – faced such a monumental challenge: a combination of a massive global economic crisis, growing levels of poverty and hunger, tens of millions dying from poverty-related causes every year, massive global land grabs, high-tech police states and surveillance societies, murder by remote control drone terror campaigns, a more distanced decision-making apparatus than perhaps ever before, and an ecological crisis of such proportions that it threatens the very survival of the human species, let alone all other life forms on Earth.

The World of Resistance (WOR) Report is a new Occupy.com series that aims to provide greater context and understanding about the causes, and the consequences, of social unrest, protests, riots, resistance, uprisings, rebellions and revolutions spreading across the globe. What form is the “global political awakening” taking in different regions, under different conditions, and with what differing degrees of success and failure?

This series aims to explore the evolution of the long road to world revolution so that we may better understand, and support, the causes of human and biological survival to ensure that people’s “central challenge” to elites – that is, the quest for “human dignity” – is made all the more impossible for 1% institutions and ideologies to undermine or repress.

Andrew Gavin Marshall is a 26-year old researcher and writer based in Montreal, Canada. He is project manager of the People’s Book Project, chair of the Geopolitics Division of The Hampton Institute, research director for Occupy.com’s Global Power Project, and hosts a weekly podcast show with BoilingFrogsPost.