Occupy Wall Street... Is it just the beginning?

Source: CNN Money

The most important fact to realize about the rash of popular protests around the world - Occupy Wall Street in the U.S., demonstrations in Greece, Spain, London and elsewhere in Europe, violent uprisings in rural China, even the revolutions of the Arab Spring - is that they aren't about money or inequality. If they were, they would be easier to deal with. They are about perceived injustice, which reflects a deeper, fiercer problem. 

The spark of the U.S. movement may soon be obscured as it is taken over by career protesters, labour unions, and others who enjoy any chance to torment corporate managers. But the spark is where we find what's new and meaningful, and it seams to have emanated from a feeling by the protesters that they are not getting a fair shot at prosperity. They believe that big companies, specifically major banks, have rigged the system to their own benefit and to the suffering of ordinary people. 

That perceived injustice is the real root of today's rage. Yes, many Wall Street executives make tonnes of money, but plenty of hedge fund managers, for example, make far, far, more, yet no one is camping outside their suburban Connecticut offices, For that matter, America loves Warren Buffet, just as it loved Sam Walton when he was the country's richest man. Fellow citizens making billions do not by themselves   get many people riled.

Even economic inequality is not enough to send mobs into the street. Inequality in the US has been increasing for over 30 years. During most of that period the rich were getting richer, and the poor were getting richer, but the rich were getting richer faster. Though the gap was widening the lid stayed on discontent as long as everyone was moving ahead. "Inequality [actually] diminished in the recent recession, as it usually does in tough times" (Forbes, November 7th 2011). If inequality were the problem people would be less upset today than they were in 2007. 

What's new is that those with medium and lower incomes have not been getting richer for several years, while those with high incomes have been, and the unprecedented slowness of post-recession job growth has left many feeling deprived of their rightful opportunity to improve their lot. More broadly, they feel they're being punished even though they did nothing wrong, while those whom they blame for the whole mess - the bankers - got bailed out and are raking it in. Infuriating injustice. 

The elements are the same in protests worldwide, whether the specific grievance is blatant corruption, as in China and the Middle East, or violation of the social compact, as in Europe. The innocent are punished while the guilty are rewarded. That combination is intolerable.

In the U.S. this narrative is flawed and in some ways plain wrong. Most of the Occupy Wall Street probably don't know that they, as taxpayers, actually made money from the bank bailout. They may be forgetting that millions of Americans are being foreclosed on because they willingly, even eagerly, took out mortgages they could not afford. Some protesters are simply clueless, like one who responded to a question from the New York Times by saying he had never heard of Warren Buffet, or one who complained to NPR that "we are paying for the bailout", or one who told the Times that Virgin America is a good company because it's "working on creating solar planes".

It does not matter. What people know or don't know is not important. All that counts is what they feel. 

Even if Occupy Wall Street should evaporate, the fuel that is feeding it will not. Think of it as a warning. Cataclysm is a long way off, and it certainly is not inevitable. But we are a little bit closer.