Behind uprisings across the world: millions living on edge

Why in the News

Protests across Europe and India, and electoral upsets in Brazil and the United States, are often explained as youth anger at corruption, “disorder” or “Trump-fatigue”. Read through Karl Polanyi‘s The Great Transformation, they reflect a structural failure of market-dominated economies that have turned every part of life into something to be bought or rented.

What did Polanyi warn, and how does it explain today’s unrest?

1. Polanyi’s warning: Polanyi held that letting the market mechanism be “the sole director of the fate of human beings” would result in social destruction.
2. Commodification: Commodification means turning things once owned or shared, such as homes, beaches and public commons, into goods sold on the market. It is like an entry fee on a park that was once free.
3. From owning to renting: Life is now not only marketised but rented. From houses to music to public commons, people cannot own; they can only rent.
4. Corruption and cost of living: Blaming “corruption” or the “cost of living” hides this deeper failure. The problem is not a few corrupt men or temporary spikes in inflation.
5. The takeaway: Unrest will keep returning as long as basic needs are priced beyond ordinary reach, whoever holds power.

What do the protests and upsets in different countries share?

1. France: Protests began over worsening conditions in schools, which politicians blamed on foreign involvement. Unions then organised them around the cost-of-living crisis.
2. Albania: Opposition to a seaside resort promoted by Ivanka Trump grew into a nationwide movement against privatisation of coastlines by government-favoured oligopolies.
3. Brazil: Lula‘s victory over Bolsonaro owed much to a nationwide movement for a 40-hour work week. The neoliberal, market-first promise that workers would join the middle class has vanished.
4. United States: The midterms were a revolt against Trump and inflation from the Iran war, with many candidates backed by the American Israel Public Affairs Committee (AIPAC) losing.

Why could the coming years be more unstable?

1. AI-driven crash risk: Massive overinvestment in artificial intelligence (AI) raises the chance of a global financial crash. This would deepen precarity (insecure work and income) and political unrest.
2. Fiscal limits argument: Critics accept the frustration but argue that governments simply do not have the money.
3. Dependence on global finance: Demand for state support will rise, but governments depend on international finance and lack the capacity or will to act. Eg. The US response to the 2008 crisis.
4. Collective action problem: National governments must act together or yield to capital. Movements seeking purely national solutions face the same choice: “internationalise or perish“.

Challenges

1. Mobile capital: Capital moves across borders faster than national rules can follow, which weakens any single country’s leverage.
2. Speculation in housing: Speculators buying up homes push rents beyond workers’ reach.
3. Misdiagnosis: Treating protests as law and order or corruption problems leaves their economic causes untouched.

Way Forward

1. Coordinated rules on capital: Governments should act together on taxing and regulating mobile capital. Eg. The global minimum corporate tax backed by the Organisation for Economic Co-operation and Development (OECD) and G20.
2. Public provision of basics: Expand public housing, education and open commons so access does not depend on rent.
3. Labour protections: Strengthen limits on working hours and minimum wages, as Brazil’s 40-hour week movement sought.
4. Watch AI-linked risks: Financial regulators should monitor AI-linked asset valuations and lending to limit crash risk.

Conclusion

Today’s unrest is a response to markets that have priced basic needs beyond ordinary reach, not a passing burst of anger. Whether governments and movements act together across borders, rather than alone, will decide if this pressure is absorbed or turns into deeper instability.

What is Inclusive Growth?

1. About: Growth whose gains reach all groups, not only those already well off. It entered India’s policy goals with the Eleventh Five Year Plan (2007-12), “Rapid and More Inclusive Growth”.
2. Participation: All groups can contribute to the growth process.
3. Benefit sharing: All groups gain from growth in proportion to their contribution.
4. Equity: Policy actively redresses historical disadvantages.

Back2Basics: Karl Polanyi and The Great Transformation

1. The author: Karl Polanyi was a Hungarian-born economic historian; The Great Transformation was published in 1944.
2. Embeddedness: He argued that markets were historically embedded in social relations, not separate from them.
3. Fictitious commodities: Land, labour and money are not produced for sale, so treating them as market goods damages society.
4. Double movement: The spread of markets provokes a counter-movement in which society demands protection from them.

Matching Previous Year Question

“[2014, GS3, 12 marks] Capitalism has guided the world economy to unprecedented prosperity. However, it often encourages shortsightedness and contributes to wide disparities between the rich and the poor. In this light, would it be correct to believe and adopt capitalism driving inclusive growth in India? Discuss.”