BusinessMirror

Protesters are united by something other than politics

- BY TYLER COWEN |

THE world increasing­ly finds itself under protest. As 2019 enters its final quarter, there have been large and often violent demonstrat­ions in Lebanon, Chile, Spain, haiti, Iraq, Sudan, Russia, egypt, Uganda, Indonesia, Ukraine, Peru, hong Kong, Zimbabwe, Colombia, France, Turkey, Venezuela, the Netherland­s, ethiopia, Brazil, Malawi, Algeria and ecuador, among other places.

What gives? One possibilit­y is that all of this is a random coincidenc­e. Another is that news of such protests is now much more widely dispersed, and so they seem more widespread. But it is also worth considerin­g what cause or causes these protests might share—and, more important, the means they have to spread their concern.

One frequent theme is people objecting to a price increase. In Ecuador, a focal point of the protests has been a demand for restoratio­n of fuel subsidies. Petroleum price subsidies also have been central to the Haitian protests. In Lebanon, citizens have been upset at a new tax levied on the use of WhatsApp, with a social-media tax also having been an issue in Uganda. In Sudan cuts to food and fuel subsidies have been a major complaint. In Chile they are protesting subway fare hikes.

The trend is that price increases may continue to become less popular. And, crucially, the Internet will help people organize against such changes.

Consider that an old-style labororien­ted protest can be organized

through the workplace or plant itself, through on-the-ground techniques that long predate the Internet. There is a common locale and set of social networks in place, including, perhaps, a union. Those who suffer from a price increase, in contrast, typically do not know each other or have common social ties. Just about everyone buys gasoline, either directly or indirectly. The Internet, however, makes it possible to mobilize these people into protests with prices as the common theme.

In other words: Protests of workers seem to be becoming less important, and protests of consumers are becoming more important.

You may recall that one of the original demands of the “gilets jaunes” protests in France was for free parking in Disneyland Paris. If you think that sounds a little crazy, you haven’t yet internaliz­ed the nature of the new millennium.

In the future, efficiency-enhancing or austerity-induced changes in prices may be much harder to accomplish politicall­y. The new trend is neither central planning nor market liberal reforms, but rather frozen

Consumer protests organized by the Internet are less likely to be ideologica­l in the traditiona­l left-versus-right sense. People of widely varying political views, including people who do not have much of a view at all, can get upset by high prices. The Internet may also be encouragin­g a “least common denominato­r” appeal to generate the largest protests possible. The point is that anyone expecting these protests to bring about their preferred set of policy changes is bound to be disappoint­ed.

prices, especially when those prices are set in the political realm.

One lesson is that fighting climate change will be harder. Fossil-fuel subsidies are broadly popular, citizens do not seem exceedingl­y willing to take on economic sacrifices these days, and in most poorer countries climate change is not a major concern. The demonstrat­ions mobilized by Greta Thunberg were mostly in wealthier countries, but future carbon emissions will come increasing­ly from emerging economies. Even in the Netherland­s, hardly a right-wing country, farmers are protesting for the right to continue their nitrogen emissions.

Another lesson is that effective redistribu­tion may well become harder. Economists tend to see simple monetary transfers as the most effective means of redistribu­ting wealth, whereas keeping prices low tends over time to lead to shortages and lower quality. Protests are not an especially salutary form of egalitaria­n pressure, so the underlying problems are unlikely to improve very much, which, in turn, could worsen the political pressures.

Consumer protests organized by the Internet are also less likely to be ideologica­l in the traditiona­l left-versus-right sense. People of widely varying political views, including people who do not have much of a view at all, can get upset by high prices. The Internet may also be encouragin­g a “least common denominato­r” appeal to generate the largest protests possible. The point is that anyone expecting these protests to bring about their preferred set of policy changes is bound to be disappoint­ed.

In particular, I would caution against interpreti­ng the protests as within the American progressiv­e framework of fighting inequality. While economic privation is a major theme, neither the absolute level of privation nor the degree of inequality seems to explain much. Haiti, the poorest country in the hemisphere and with some of the most dysfunctio­nal politics, is seeing protests because the economic situation is so bad. In Chile, meanwhile, the wealthiest country in Latin America and with falling inequality, the demonstrat­ions may be more a matter of high or rising expectatio­ns.

One thing is for sure: With mass protests, as with so much else, the Internet is changing everything.

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