Peasant revolution 2.0

BOSTON — Political risk analysts are jittery people. You would be too, if your job was to watch the world and predict where bad things were about to happen.

But we might all want to be a tad more nervous. As the global economic crisis continues to spread, a quick tour of GlobalPost shows troubling signs just about everywhere.

The Chinese government admitted this week that 20 million migrant workers have lost their jobs, as factories shutter across the country. The real number, analysts say, is probably much higher. Russia’s newspapers are featuring tales of protests and increasing political violence. Elsewhere in Europe, 2.5 million French workers took to the streets (yes, I know it’s France but the place does have some history with unruly crowds). Iceland’s government collapsed. In Ireland, the head of the Irish Congress of Trade Unions warned of "revolution" from public workers, while teachers, pensioners and students have staged recent protests. In Japan, Prime Minister Taro Aso was humiliated in parliament and recent data shows a new crime wave by Japanese seniors.

But here’s the scary part: Political science says street protests, political violence, rising crime, social unrest — even revolution — should be happening right about now.

That’s according to a useful theory put forth in the 1950s by American political scientist James C. Davies. The big idea behind the so-called "Davies J-curve" is simple and elegant: Unrest occurs when a people’s rising expectations — about how much money they can make, what they can buy, whether they have enough food or medicine — are suddenly dashed.

The Davies J-curve

(Source: www.fragilecologies.com)

In other words, people grow happy as they grow richer. But things turn ugly when the rug is pulled out from under them, and the gap between expectations and reality widens. According to the theory, this phenomenon occurs whether you’re a peasant in China or a banker in Paris.

Here’s the rub: The world economy has just gone through its longest expansion since the end of World War II, driven in large part by China, India, Brazil, Russia and other emerging economies where masses of humanity have been transformed from poor, rural peasants to consumers.

Now the sudden economic downturn has hit rising expectations around the world and we are on the wrong side of the Davies J-curve.

As a result, we are starting to see instability. "And we’re going to see a lot more of it," warns political risk analyst and University of Chicago professor Marvin Zonis.

So what will this mean? It is, of course, anyone’s guess.

On the dark side of pessimism, China could implode. Russia could devolve into an even more authoritarian place. India could witness the rise of a right-wing Hindu nationalist party, stressing the country’s 154 million Muslims and further complicating tense relations with nuclear-armed Pakistan. Widespread labor unrest could sweep through Europe, the Americas, Asia and elsewhere.

But whatever ill comes of this global downturn, it’s a safe bet that those countries with the strongest and most flexible political and economic institutions will be best prepared to weather the inevitable storm.

Can a country cope with rising poverty? Can it feed its masses? Can it provide adequate health care and housing? Does it have political systems that will allow for (relatively) peaceful protest and political change? Does it have a banking system that can be healed? Does it have regulatory agencies and judicial bodies to create and enforce fair rules?

The answers to these questions will determine whether crisis leads to recovery, or if we’re about to witness peasant revolution 2.0.

Recent dispatches by Thomas Mucha:

Decoding Davos

Goodbye Kitty: Japan in Decline

The sick man and the dragon

Can Barack channel Miles?

For more coverage of the global economic crisis, and other wordly matters, follow Thomas Mucha’s Reporter’s Notebook.