2011: Year of the Protest
2011: Year of the Protest

On October 15th 2011, protests based on the Occupy Wall Street movement were held in 80 countries around the world. Hundreds of thousands of people around the world have expressed their anger and indignation against corporate greed, especially the role of bankers and politicians in wrecking the global economy. With high unemployment and few job prospects on the horizon, many believe that a signal needs to be sent to corporations that a continuation of the status quo is not acceptable.

While the protesters are united in their cause, they do not prescribe any policy solutions to fix the problem. The movement is leaderless and is fueled by social media.1 Applebaum, columnist for the Washington Post writes:

The emergence of an international protest movement without a coherent program is therefore not an accident: It reflects a deeper crisis, one without an obvious solution. Democracy is based on the rule of law. Democracy works only within distinct borders and among people who feel themselves to be part of the same nation. A “global community” cannot be a national democracy. And a national democracy cannot command the allegiance of a billion-dollar global hedge fund, with its headquarters in a tax haven and its employees scattered around the world.2

For Applebaum, these protests bring to light the limitations of governments to solve problems of a global nature, especially monitoring transnational corporations, whose offices are scattered around the world. She has concluded that globalization has undermined the legitimacy of Western democracies.3

In the New York Times, Thomas Friedman writes that these protests represent either the breaking down of the current system, as it has reached its financial and ecological limits, or the early stages of a big shift brought about through the merger of globalization and information technology: doom or opportunity. Similar to Applebaum, the first theory notes the limitation of global market capitalism. Corporations focus on profit and executives are rewarded. However, the benefits have not trickled down to the rest of the population. While the second theory is more optimistic noting that the Internet provides the opportunity for anyone anywhere to get an education, start a global business, etc., therefore the common man has a chance to compete and succeed in the global economy.4

Many feel that they do not have economic opportunities and that their governments are not solving the economic crisis in a manner that benefits most of the population. These protests began organically by grassroots organizers in more than 800 cities. Each protest reflects the local culture, yet copies the technique of reclamation and occupation of the public space.5 Europe has embraced the Occupy Wall Street movement. Angry about austerity plans that cut government services at the time they are needed most, Europeans are joining the movement, building upon a recent history of protests.

Unrest in Europe began in France in 2006, spread to England and Spain and then to the rest of the continent. In 2006, French university students and workers occupied universities in protest of the Equal Opportunity Law, a piece of legislation that made it easier for employers to fire workers under 26 years old. Protests in Spain have been ongoing since May 2011 as protestors decry high unemployment, debt, lack of affordable housing, a broken education system, and an inept government.6

Similarly, Israelis have been protesting since May 2011 over high cost of housing, food, education and health care. A couple hundred thousand protesters marched in September 2011 to express their anger about the high cost of living. The middle class pays most of the tax burden7 and feels that their purchasing power is decreasing. Wages are very low for police officers, nurses, teachers, civil servants, and social workers. Part of the problem stems from cheap, subsidized housing in the settlements and high security costs. Another root cause is the disproportionate power of small political parties in Israel’s parliamentary system, whose government can easily fall if one of these parties quits the coalition, giving them a lot of power to influence legislation.8

Influence of the Arab Spring and Social Media

Occupy Wall Street and similar movements worldwide were inspired by the Arab Spring of 2011. The Arab Spring arose organically as youth were inspired by singular acts of resistance against corrupt regimes. These acts were not accomplished in isolation as millions around the world witnessed them on Youtube and shared them on social networks. State-run media in the Arab world no longer controlled access to the news and inspired youths organized protests that led to the downfall of Egyptian and Tunisians leaders. To read more about the impact of the Arab spring, click here.

While social media has been used by the organizers of these movements, it is not the cause only the enabler. As noted in a Foreign Affairs article, “such network instruments do not create the movements, of course, but they are convenient tools, because they correspond in some sense to the horizontal network structure and democratic experiments of the movements themselves.”9

Impact of the Protests

At the end of the day, what has been and what will be the impact of all of the protests? The Arab Spring brought down the governments of Egypt, Tunisia, and Libya. These countries are now in the process of building their own democracies. To learn more click here.

Protest movements in Spain and Israel have led to major political changes. In Spain, after decades in power, the governing Socialist party was defeated in regional and local elections in May. It is unclear though if this defeat was due to the protest movement that began one week before the elections. Some protest organizers asked followers to enter blank votes as a sign of dismay with both parties. The change in power was not seen as Spain becoming more conservative, but that the population disagreed with how the socialists have handled the economy.10

While in Israel, there are signs that the government is taking heed of the protestors’ demands. Israel’s public agenda has been redefined by the movement. Prime Minister Netanyahu formed a committee to examine the protestors’ demands and produced the Trajtenberg Report, which aims to restructure Israel’s socioeconomic priorities.11

Solutions offered in the report include increased building of low income housing, raising of the Corporate Tax and Capital Gain Tax to 25 percent, reducing the prices of subsidized products such as milk and eggs, implementing the Free Education Law from the age of three, and a 50 percent discount on public transportation for students, among other initiatives. The goal was to increase the standard of living by making more products affordable.12 The report was approved by Netanyahu’s cabinet and is awaiting approval by the Knesset, Israel’s parliament. It has been rejected though by many of the protestors and does not address the underlying security/political situation with the Palestinians, one of the root causes of Israel’s high cost of living.

Western governments in Europe and the U.S. have not yet made any concessions to the protesters. President Obama has expressed sympathy, but has not taken any bold steps to address their concerns. Although that is not necessarily the goal of the Occupy Wall Street movement and its followers worldwide. Many of these protestors would like to see bold action by corporations, whom they see as reckless and unconstrained.

Citigroup’s CEO Vikram Pandit has acknowledged that trust has been broken between the banks and the U.S. citizens and has expressed interest in meeting with the protesters to talk about their concerns and explain how his bank is trying to increase lending to small business owners. Citigroup is the 3rd largest bank in the U.S.13

Change may be on the way. On October 18th, the New York Times reported that Goldman Sachs has reported quarterly losses, the first since the financial crisis and only the second time ever since it went public in 1999. Regulations are now starting to force banks to discontinue proprietary trading, reduce their borrowing, and hold more capital. Less risk taking and more traditional investment banking may become the new norm.14 The new regulations may help prevent future banking crises and the need for huge government bailouts with public money.

This does not mean that there will be more equitable distribution of wealth, more jobs on the horizon, and a stronger global economy in the short run. It will not help solve the sovereign debt crisis in Europe or magically return U.S. manufacturing jobs lost to China. It will not increase the purchasing power of the middle class or stop corporate influence of politics worldwide. Globalization will not disappear.

Reclamation of the public space to denounce corporate greed can certainly help draw attention to the problem and build a sense of community amongst those who feel marginalized and left behind. Republicans would say the answer lies in lower taxes, which returns money to the people to use it as they deem fit and to corporations who would hopefully hire more people. Democrats would say the answer lies in better social protections, which requires more money being given to the government to provide these services. One can only hope that all of the protests worldwide will lead to a dialogue on the real problems facing the world today and clear policy choices ultimately to be decided at the ballot box.

1 Tharoor, Ishan. “Occupy Wall Street: A New Era of Dissent in America?” Time. October 12, 2011. 2 Applebaum, Anne. “What the Occupy protests tell us about the limits of democracy.” Washington Post. October 17th, 2011.
3 Ibid.
4 Friedman, Thomas. “Something’s Happening Here.” The New York Times. October 11, 2011.
5 vanden Heuvel, Katrina. “The Nation: Wall St. Protests Will Shape Politics.” National Public Radio. October 12, 2011.
6 Hardt, Michael and Negri, Antonio. “The Fight for ‘Real Democracy’ at the Heart of Occupy Wall Street.” Foreign Affairs. October 11, 2011.
7 “Israelis hold renewed mass protests over living costs.” BBC. September 3, 2011.
8 Taub, Gadi. “What Caused the Current Wave of Economic Protests Across Israel?” The New Republic. August 3, 2011.
9 Hardt, Michael and Negri, Antonio. “The Fight for ‘Real Democracy’ at the Heart of Occupy Wall Street.” Foreign Affairs. October 11, 2011.
10 Abend, Lisa. “Protests: Has the Revolution Come to Spain?” Time. May 23, 2011.
11 Somfalvi, Attila. “Cabinet approves Trajtenberg Report.” Ynet. October 9, 2011.
12 Lahav, Avital. “Trajtenberg Committee submits report.” Ynet. September 26, 2011.
13 “Pandit Says He’d Be Happy to Talk With Wall Street Protesters.” Business Week. October 12, 2011.
14 Craig, Susanne. “Goldman Loss Offers a Bad Omen for Wall Street.” The New York Times. October 18, 2011.

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