Debt-laden governments across the globe are slashing spending to bring budgets in line. At the same time, riots in Athens and in London are the latest examples of spreading civil unrest. Does economic austerity cause social anarchy?
A new working paper by economists Jacopo Ponticelli and Hans-Joachim Voth seems to say yes. Studying instances of austerity and unrest in Europe between 1919 to 2009, Ponticelli and Voth conclude that there is a “clear link between the magnitude of expenditure cutbacks and increases in social unrest. With every additional percentage point of GDP in spending cuts, the risk of unrest increases.”
“Expenditure cuts carry a significant risk of increasing the frequency of riots, anti-government demonstrations, general strikes, political assassinations, and attempts at revolutionary overthrow of the established order. While these are low probability events in normal years, they become much more common as austerity measures are implemented.”
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The most historical exemples can be found in Germany. The state of affairs were quite anarchic in the Weimar Republic, following the collapse of the German Empire right after World War I, which slowly saw the rise of the Third Reich under Adolf Hitler. Austerity measures were necessary to pay the war reparations.
The riots are the result of long term problems. Austerity measures are only put in place when Government excesses by the powerbrokers and government officials have exhausted an economy. Rather than reduce their greed, Governments reduce any spending that does not provide those same powerbrokers continued and ever increasing revenue. Because the process of economic decline is not instant the contraction of population friendly spending is a slow one. Disaffected numbers grow slowly spreading the fuel for unrest until a tipping point where an event, no matter how small, clearly demonstrates the lack of power of the average person. This event coupled with the perception of government indifference born by the long period of decline while the wealthy have become more enriched sparks the unrest. Those with the energy of expectation and a lack of long-term conditioning to the status quo are most likely to riot first – the youth.
Well articulated.
Excellent articulation, still does not suggest a way to resolve this dilemma.
Way to solve the problem is cut off the FREE money and make people work – empty hands make idle minds and cause riots
Well said. The answer is for the powerbrokers to back down before they get a full scale revolt.
Well said indeed. This response is more for Duke's comment's. Be careful of what you wish for. Your whole premise is based on companies hiring the local population. What happens if those companies are out-sourcing those very jobs that your thesis is based on? You need some type safety-net for the populace at whole, or you will end up like either 1789 France, or like 1917 Russia or 1933 Germany.
The Austerity cuts haven't even taken effect yet. It is absurd to call people who rely largely on government services to get by anarchists. They were the opposite of anarchists, they were statists. Now that the Nanny States of Europe are downsizing they are all freaking out. They might have to actually take responsibility for their lives oh no! It was actually big government, and the cradle to grave seemingly warm and fuzzy blanket the government has provided the many at the expense of the few that lead to this.
Right on!
And apparently the stated goal of the Obama administration is for us to be more like Europe. WHY???
You are on the money. Tha nanny state enables weak willed adults to act like children relying upon the labor of others for their sustenance. Like a child when the toys are removed they react with anger and bewilderment. If they expend 10% of that anger improving themselves and getting a job they and the world will be a better place.
Their Liberal overseers who are employed running the system that convinces these people that they are victims will fight hard to prevent the freedom available in the priavte economy. They could lose their customers. The actual protests should be about the ruin these Keynsian, Statist policies have brought to the world. Only one question needs to be answered to determine the difference between oppression and freedom. Did you exchange your money for a good or service freely???? The answere is always yes in the private sector and no in the government.
The Unitred States is a nanny state for global megacorporations who are now whining and crying for their welfare checks to not only continue... but to increase. The main goal of megabusiness these days is to buy politicians and get their welfare checks... they get BILLIONS without working at all. They pay no attention to the market, which is why they end up spending more BILLIONS on advertising and mind control. Imagine what would happen if they spent all this money and effort on working! WOW... novel concept. How about ways to manufacturing using less water and toxic chemicals? Lots of brainpower working on welfare payments instead of better, greener products.
"Millions for defense, but not one cent for tribute."
"Does austerity lead to anarchy?"
"Studying instances of austerity and unrest in Europe between 1919 to 2009, Ponticelli and Voth conclude that there is a “clear link between the magnitude of expenditure cutbacks and increases in social unrest. With every additional percentage point of GDP in spending cuts, the risk of unrest increases.”
Emphasis mine.
And the implication is clear: societies get themselves in this kind of mess by promising the impossible. If they'd never made those promises in the first place, there wouldn't have to be cutbacks–the inevitable result of promising the impossible–and people who believed, who relied on, those impossible promises wouldn't feel, as they do, betrayed.
People "relied on" those promises because they an honest days work is too often not enough to make ends meet. In our own country we have recently had people going bankrupt because of medical expenses, a problem that the Europeans have fix with their less costly single payer health care systems. Looking back further, before the introduction of Social Security there were senior citizens who had worked and saved their entire lives and still didn't have enough money to get by when they were too old to work. I don't know about you, but i would rather we paid a little more in taxes than have the elderly eating cat food or homeless.
As to the notion that civil unrest is simply a result of people feeling betrayed when the governments "impossible" promises and broken, that is a view that cannot be supported by the events of human history. The French and Russian monarchs didn't betray any promises to their people, they just presided over societies built on inequality. It is the feeling that the government is working to the benefit of the few at the expense of the many that causes these types of riots and rebellions.
Don't believe the hype. I've been fortunate enough to work overseas in Europe. Talk to a German or Spaniard. The high taxes they first paid for health benefits has gotten funneled off to some other BS liberal program. Do you trust ANYONE else with your money? I don't. Remember, there's no limit to how fast somebody can spend someone else's money!
Globalism, stupid! This monster Greed is causing upheavals. You never undermine people's rork base and the right to work, by seeking cheaper labor ... in China. The results are for all to see. First, the huge economic crisis in the world. Second, the Arab Spring. Third, the "Summer Spring" in England. Where will this end? Undo the damn job migration!!!! Every Nation has a right to a stable job and tax base! Do it by decree! Arrest the globalists. Nationalize Nike, McDonald's, Caterpillar and the like! Avoid that the people do it for you!
Agreed. Never build anything that you can't maintain. But... Never underestimate the ability of humanity to breed itself away from stability. It's the sheer size of the populace that causes the system to malfunction. The irony of it all is that our economy depends entirely on that growth. We are in for hard times.
Agreed. Globalism is unsustainable! It looked good on paper: cheap labor. Why not? But soon the people throughout the world are beginning to ask: where are our jobs??!! What aggravated the problem, is that China now controls the markets! It's a win for Marx and Communism ... handed on a silver platter by Capitalists! The greedy ones! Reverse globalism, or the world will conflagrate!
Globalism is just another name for Oligarchy... rule by a few... and they NEVER rule justly. Anarchy comes from inequity. You have all the power so you pay me nothing for my labor that keeps you with BILLIONS in your pocket. Same old oppression story and anarchy is the same old answer. Oppress enough and you get beheaded. Isn't it time for those at the top to learn a different way to rule?
Agreed. Our military spends 20 TIMES more than any other country, literally taking food out of the mouths of poor babies. Why do we spend that much on guns? Because Republicans are afraid, very afraid, as well they should be. You can feel the anger building, it's almost palpable. Will the soldiers turn their guns on their parents, or on the ones who have destroyed America? And you know who they are – the Kochs, the Murdochs, and anyone that considers hard working Americans fodder for their financial empires. We shall see.
Thank you for articulating this. The Kochs et al. will rule as long as those soldiers who give their lifes for us are also willing to shoot us in the street. Maybe so, maybe no.
"Does austerity lead to anarchy?": All Anarchy means, in its original definition, is no government, not chaos, not violence; it doesn't even mean to overthrow a government. But through lies, propaganda and constant erroneous association, even by so-called journalists, as in this article, the meaning has been perverted. I'm an Anarchist and I never want to hurt anybody or damage anything; so is Noam Chomsky, and so was Leo Tolstoy, and many others who were REAL Anarchists who want or wanted REAL Anarchy, not mindless, chaotic violence, devastation and bloodshed. Get your definitions right Mr. Cookson, use your language correctly, and stop perpetuating lies and propaganda.
Anarchy: A government established to impose no government.
Wrong, but thank-you for playing.
Every government that is mantally impaired is potentially anarchic! All that is happening, happens because the think tanks were myopic. People like us, the normal bloggers, were marginated, censured, silenced in the last decade! I saw the evils of the union greed and globalism. I criticized the two-party endless bickering and mutual self-castration! I protested the exportation of the American job base. I challenged Naom Chomski about his paranoia regarding the concept of one truth for all. He scuffed at me like a mad dog! He was part of the establishment, "a well-known professor." I was the voice in the wilderness. Today we see where these "respectable" people have led us!
when morals aren't taught and people are spoiled (including through government handouts) ... anarchy will be a consequence of trying to rein in those handouts that have become so precious to them.
You got it right. The Democrats, with their rabid liberalism, relativism, and scorn for the precepts of God regarding morals and abortion, have forged an iron coffin for America! We must return to a one-party system! let all people participate. Let every voice be heard. No more censorship by Adrianna Huffington and Newsvine! No more "competing" among Americans! We want a single voice!
You got it right. All those corporate payoffs and handouts getting threatened to be lowered is having the corporations get ever more extreme in their oppression. Now they are hiring Teabagger Terrorists to hold the country hostage. What next?
History repeats itself and my view is yes it can cause unrest which is different from Anarchy. When the gov't stops listening to the majority and listens to the few (RICH), the anger will grow within the majority and when that one small thing happens and all the anger is unleashed the gov't loses control because it no longer has the support. With technology things can happen way faster and things can get crazy fast so if the US is smart it will go back to what made this country what it is and thats majority rules not the ones who can afford it.
The spark is not always the most obvious thing, it is just a spark. What is unleashed is long-simmering anger at corrupt politicians bought and sold by the wealthy for the wealthy of the wealthy... or the wealthy wearing their Ku Klux Klan masks.
Anarchy by definition is no government , thus state of anarchy would mean no government involvement in various matters. If government spends less, then government would be involved in less things. Since austerity means government spending less money, I don't think austerity can take the society further away from anarchy; it can only lead the society closer to it since government will be doing less things.
This is a nice little meme to follow, but its awfully short on details. What type of cuts and what type of riots? Europe typically has protests against cutbacks in college tuitions - does that count.
It counts when the Ku Korp Klan tells you that you are not worth hiring without a college diploma. Then tell you again every 10 years or so that you need a new, improved education by throwing you out instead of financing re-education of their work force.
No, injustices lead to this type of anarchy.
Huge disparities in the distribution of wealth between the elite rich and the working class.
.
The people have a right to be angry, the violence excepted. They were FORCED into paying into things such as Medicare and Social Security (or their country's equivalent. Promises were made. Promises were broken. Trust funds were illegally raided. Shady deals were made. The money disappeared; the same money the people could have used to assure their own futures. Now there's nothing left for them to do except work until they die... and continue to pay into these ponzi scemes! If you're not angry, you're in a coma...
Hell yes it does, as the saying goes,watch out what you say or do too someone who has nothing to lose because its just like having it all! Riot on Brothers and sisters!
Desperate times lead to desperate measures. survival of the fittest.
Welfare in this country has long been a control mechanism. If it were to be suddenly taken away, the inner cities and other areas would be in complete chaos. The government would have to bring in the military.
Control mechanism? Or delay mechanism while the top steals everything in sight?
Desperate times lead to desperate measures. Extreme examples: the French and Russian Revolutions. When the income gap between the rich and the poor increases too much, some people get so angry and desperate that they riot. It's not that these people are lazy (like Republicans would like to believe). They just want a decent job that pays a decent wage, but they can't find it. Social spending on education, job training, welfare, etc eased the burden on them, and without it they are more desperate than ever.
There comes a point when we must say NO. No, we're not going to spend any more money on things we don't need. When we start taking things for granted, we forget what it's like to not have designer jeans, or a cell phone, or Facebook. That's when problems start–when people take so much for granted.
Austerity is not when the poor give up everything, but when everything is taken away from them. The United States is the only industrialized country that is callous and greedy enough not to provide the hard working men and women that made the country a decent and guaranteed health care provision. Lots of Benz', few hearts.
Worst of all Austerity of this form accomplishes nothing. Force the poor to pay for the excesses of the Rich, not
only will you get riots, you deserve to get riots. Close tax loopholes to pay for the bailouts of the ultra rich. Don't
take it out of the hides of the poor and middle class!
If I were President Obama, the first thing I would do, is to call the leaders of China, and ask: Who comes first, our workers,and their right to work, or your products? If he answers in the negative, or ambiguosly, I would tell him: Our workers come first, and I do not want to see any more Chinese containers bringing products to our shores!
Well we are not there yet, the riots, actually, was caused by police brutality.....not the poor or unemployed....what did I miss something? We, Americans, will overcome this, the rich, may not be so rich.....after all, because they will too have to give somethings......faith my brothers.
There has always been police brutality. It was a spark, not the gasoline that burned. Long term anger at corruption and greed at the top is the gasoline. Any odd spark can set it off.
These unrest in Athens and Europe brought about by austerity will eventually bring social anarchy! http://www.insuranceadjustertraining.net
Austerity in iteself does NOT lead to anarchy... anger at corruption and greed at the top leads to anarchy.
i think the government ripping us off............going on vacation..............then coming back and saying the country is going bankrupt should be the thing that leads to anarchy but americans ain't got the balls to stand up for themselves so ha ha ha ......................let them steal more money from ya and when people like you get locked up..................you'll be the ones washing peoples drawers
Re: DAVID GOODHART has woken the sleeping giant with some old tones that remind one of the ignorance of a hateful paste blaming a people stating "those people" have nothing but a culture of violence while not considering of course, causes for that disharmony. My question is why must he label a color to a socio economic problem. Is he dissatisfied with the overall possessive investment in whiteness while giving little note to his "few white kids" who happen to pick up the black culture of violence, hip hop, etc. You know David, England is not at all innocent of a past for making unqiue causes that have affected Asia, Asia Minor, and even America. Here is a hint, if you ever want to gauge the situation of the present, please read more about the past. It will help. England was not innocent of having a superiority complex back in the day. I hope you will hold thy tongue of such "black" comments. The paradox if you dig deep enough will have roots in your own backyard. This problem involves everyone so please address it as such. Poets write, they don't create a problem, actually they alert you far in advance to one. Why do you believe every oppressive nation first starts by arresting its artists, musicians, and activists to peoples rights? Please be the better person especially on GPS. It's my favorite show on Sundays not True Blood. Comments like that may be well placed there than on here.
to answer your question, yes, i do believe so. why? because we have people representing us that are lobbyists and tyrants. we are stuck with these criminals as leaders and there's nothing we can do to change it. did you know that the united states president makes $400,000 (+$50,000 for expenses) a year? Did you know that every politician who has served as president (ex-president) still gets medical benefits and a salary from the government after their term is over with? it's simple to see that these people that we intrust our country to are greed stricken, money hungry people who just want to profit off of our country and our people. did you know that in 2001 the presidential salary increased by 100%? check this site (but be sure to check out the links for other political salaries): http://usgovinfo.about.com/od/uscongress/a/congresspay.htm and this page for the average household income: http://en.wikipedia.org/wiki/Household_income_in_the_United_States
it's truely sad, "We The People" don't agree with how our countries are being lead, simply because our leaders are fueled by greed... money. nothing we can really do about it but vote and hope that the next leaders we elect are one of us, not one of them..
Imagine there's no Heaven
It's easy if you try
No hell below us
Above us only sky
Imagine all the people
Living for today
Imagine there's no countries
It isn't hard to do
Nothing to kill or die for
And no religion too
Imagine all the people
Living life in peace
You may say that I'm a dreamer
But I'm not the only one
I hope someday you'll join us
And the world will be as one
Imagine no possessions
I wonder if you can
No need for greed or hunger
A brotherhood of man
Imagine all the people
Sharing all the world
You may say that I'm a dreamer
But I'm not the only one
I hope someday you'll join us
And the world will live as one
If we listen to Cameron and change the language we could hear Mubarak, Gaddafi or others that blame the people for their reaction to the excesses of Government. While difficult for many it is obvious to an unbiased observer that the events that are happening in GB and Europe, when put into historical context are a natural outgrowth of the Wealthy, plundering the economy at the expense of the middle class and poor for a long period of time. Discontent and radical action are easily suppressed at first through labeling and profiling. Early on in most societies the most combustible groups are immediately identifiable: they will be a racial group, religious group, immigrants or a Section of the City. Their earlier volatility is to be expected because they will have been disaffected for the longer period. As the disaffection grows their ranks are swelled with others who are sympathetic or lowered in their economic status by the excesses of Government. In time what began as an easily identifiable group grows into a diverse mix of participants who are difficult to target and marginalize along the traditional methods above. While their will be differences within the now Mob, their common enemy will be the Government. Suppression will take violence and then begins the descent into chaos. How to prevent it all requires man to depart from their own nature of greed and lust for power which is not likely or a profound event that shakes the core of our existence forcing everyone into a Mob. The former is not likely and the later until it happens is fantasy.
Lynx
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