One of the more feared consequences of any economic depression is the specter of civil unrest. Never doubt that governments are prepared for this. One of the markers authorities look for during prolonged, severe economic downturns is a rise in racial incidents especially directed toward immigrants.[Reuters]
This week in Southern Italy, a familiar scenario played itself out. White youths taunted African illegal farm workers (primarily from Nigeria, Ghana, etc.) with air guns igniting violent demonstrations from a people crying “we are not animals.”
Unemployment nudges 20% in the region of the riots. As in the US, most Italians will not do the kind of work in the fruit groves that the migrant workers will do and at the illegal level of the pay they receive.
The situation in Italy is worse than in other EU countries since the Prime Minister has been outspoken in his view that Italy is for Italians and will never be a “multiethnic.” [MSNBC.com]
The other complicating factor particularly in Southern Italy is the role the Mafia plays in the economy. In short, it is not a region easily managed or controlled.
Think this all sounds far away? Think again. Economic conditions in Mexico are deteriorating with the situation exacerbated by the violence surrounding the drug trade. With the drug wars pushing into our southwest and with no real hold on immigration, the stability of our society will be sorely tested if the economic situation does not soon improve.
The outlook for Asia is not assured:
Fears of widespread unrest last year failed to materialise, and most Asian economies are now posting impressive growth. But unemployment is a lagging indicator, and many political risk consultancies are warning that 2010 may hold nasty surprises.
“Although we maintain that the crisis has already inflicted its deepest wounds, its impact will continue to be felt throughout 2010,” the Economist Intelligence Unit said in a report.
The main downside risks to economic stability this year include asset price bubbles, deflationary pressures, and the danger of “an increase in the frequency and intensity of social and political unrest, given increased unemployment, weak growth and impending fiscal austerity measures in many countries,” the EIU said. [EconomicTimes]
The longer the Depression lasts, wounds to the economic and social fabric of ours and other nations are deepening and pose very real threats.
- Some of the world’s economic output (thought to be around 10 per cent of yearly productio) could be lost forever and will not be made up. [Financial Times]
- Permanent loss of jobs that will not come back or if they do, will not pay what they once did. This will cause population displacement and the decline of currently prosperous regions.
- Decline in skilled and/or educated workforce. Skill sets left unused and not updated, deteriorate over long periods of unemployment. With fewer or no jobs, fewer young adults will be able to attain higher education. A skilled, educated workforce is what companies look for when assessing locations for potential expansion.
This month The Economist made the following projections of the possibilities for civil unrest globally:
2010 could be a year that sparks unrest
IF THE world appears to have escaped relatively unscathed by social unrest in 2009, despite suffering the worst recession since the 1930s, it might just prove the lull before the storm. Despite a tentative global recovery, for many people around the world economic and social conditions will continue to deteriorate in 2010. An estimated 60m people worldwide will lose their jobs. Poverty rates will continue to rise, with 200m people at risk of joining the ranks of those living on less than $2 a day. But poverty alone does not spark unrest—exaggerated income inequalities, poor governance, lack of social provision and ethnic tensions are all elements of the brew that foments unrest.
Here is the global combustibility map that accompanied the Economist article:
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VotingFemale Speaks! – DEM Voters rejecting raw Socialism in Massachusetts?
HotAir – Unemployment remains at 10.0%; Update: “Unexpectedly”
LisaInTX
January 11, 2010
SH
Great post! Greedy governments are sucking the wealth out of the nations, creating no jobs, controlling the masses where they can not care for themselves or their families, they are loosing their properties….this is world wide and unless something is done in each county by the people suffering, it looks to only get worse.
America has a choice….use our OWN Treasury and make our OWN money….this I believe will help our country.
crisismaven
January 26, 2010
This is only the beginning, when society breaks, everyone will want gold or guns:
Do we see a gold bubble?
samhenry
March 19, 2010
I believe we will. Some predictions take gold to a 2,000 level but you have to be careful. Something could take it much lower. If you get into gold at a level about usual norms, you should watch it carefully. I would also see if it stabilizes at that level for a few months.