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Moisés Naím

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The Clash of the Middle Classes

Posted: 08/05/11 01:23 PM ET

The main cause of coming conflicts will not be clashes between civilizations, but the anger generated by the unfulfilled expectations of a middle class, which is declining in rich countries and booming in poor countries.

"The clash of civilizations," the theory popularized by Samuel Huntington in the early 1990s, maintains that once the ideological confrontation between communism and capitalism is over, international conflicts will arise between countries with different cultural and religious identities. "The clash of civilizations" will dominate global politics. "The fault lines dividing civilizations will define the frontlines of the future," he wrote in 1993. For many, the attacks by al Qaeda and the wars in Afghanistan and Iraq confirm this view. As we now know, however, what has happened is that conflicts have been more within civilizations than between them. Pious Islamic terrorists have killed far more innocent Muslims than anyone else. And the battles between Shiites and Sunnis continue to cause the majority of Muslim casualties.

In my opinion, a far more important source of friction than clashes between cultures or religions will be the changes in living standards of the middle classes in both rich and poor countries. In the former the middle class is shrinking, while in the latter it is swelling. These changes lead to thwarted and unfulfilled expectations -- both feed social and political instability.

Poor countries experiencing rapid economic growth now have the largest middle class in history. This is true for Brazil and Botswana, China and Chile, India and Indonesia, and many other nations. According to the World Bank, between 2006 and today, 28 formerly "low-income countries" joined the ranks of what it calls "middle-income" ones. Their new middle classes may not be as prosperous as their counterparts in developed countries, but their members now enjoy an unprecedented standard of living.

Meanwhile, in countries like Spain, France, or the United States the status of the middle class is going from bad to worse. In more than 1.3 million Spanish households, all the members of working age are unemployed. Only 8 percent of French believe that their children will have a better life than them. In 2007, 43 percent of Americans claimed that their salaries were only enough to make ends meet. Today, 61 percent admit this.

On the other hand, the frustrations due to the unsatisfied aspirations of the middle class in China and Brazil are as politically explosive as the anger over the new economic insecurity of the middle class in Italy, Spain, or Greece.

Governments in the poorer countries are under enormous pressure to meet the booming demands of the new middle class while those of the richer nations are struggling to contain the fall in living standards of the existing bourgeoisie.

Inevitably, some politicians in developed countries are blaming the economic decline on the rise of other nations. The assertion that job losses or stagnant wages in the United States or Europe are due to the expansion of China, India, or Brazil are common. These claims will continue and even intensify as the crises deepen even if the best available research concludes that these are unfounded accusations. The data show that lower wages or job losses in developed countries are not due to the rapid growth of emerging economies, but mostly to technological change, anemic productivity, or tax policy and other domestic factors.

On the other hand, in poor countries, the new middle class which has increased its consumption of food, clothing, medicine, and housing, now demands better schools, cleaner water, better hospitals, more convenient transportation and all kinds of public services. Chile, for example, is one of the most economically successful and politically stable countries in the world and its middle class has been growing consistently. Yet, street protests demanding improvements in public education are regular occurrences. Chileans do not want more schools, they want better schools. And for all governments it is far easier to build a school than to improve the quality of teaching.

In China, there are thousands of demonstrations every year to demand more or better public services. In Tunisia, recent riots expressed the impatience of the people who overthrew the regime of Ben Ali, despite the fact that the country boasted the best economic performance in North Africa. No government can adequately meet the new demands of a booming middle class at the same speed at which they occur. And no government can survive the fury of a once prosperous middle class that sees its situation worsening daily.

The political instability caused by these frustrations is already visible in many countries. Its international implications are not yet so obvious. But they will be.

Moisés Naím is a senior associate in the International Economics Program at the Carnegie Endowment for International Peace. He tweets at @moisesnaim.

 
The main cause of coming conflicts will not be clashes between civilizations, but the anger generated by the unfulfilled expectations of a middle class, which is declining in rich countries and boomin...
The main cause of coming conflicts will not be clashes between civilizations, but the anger generated by the unfulfilled expectations of a middle class, which is declining in rich countries and boomin...
 
 
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11:18 AM on 08/07/2011
In 1970, there were about 4 billion people on this planet. Sometime this fall, the 7th billion person will born, probably somewhere in China or India. Some estimates of the earth's capacity to support a human population at a maximum is somewhere around 9 billion, a level we will reach in about 25 years at the current rate. Competition for resources has gotten pretty stiff, but it will soon max out with the only thing left to eat is each other. Middle class people taste the best as poor ones are too thin and tough, and rich people are too fatty. There are lots of examples of self destruction in the animal kingdom resulting from over-population. Prognosis: not too good.
02:50 PM on 08/06/2011
This clash of the different middle classes is an important point that many of us ignore when thinking of the decline of the United States and the other fact we ignore is the decision by the rich investing class to stop investing in manufacturing in the US and instead put their money in the crooked financial sector that is shielded from any serious regulation by our corrupt political system. Now that the corporate rulers of America are insisting that their political puppets cut so called entitlements we have the politicians including the president resisting even modest cutbacks in the growth of the pentagon budget as they continue to indulge their delusions of grandeur through the expansion of the overseas empire as if it can go on forever.
ThePeacemakers
Concerned Citizen
02:43 PM on 08/06/2011
Or you'll eventually get the working people of the world united as they all discover "trickle down" is BS no matter what you call it.
11:22 AM on 08/06/2011
The plain truth that we are not facing is the following:

In a globalizing economy of quasi free trade, the OECD countries cannot go on paying their middle class five times what the rest of the world pays its middle class. This is because the rest of the world's middle class has broadly similar education levels and access to technology today. This means they are just as productive as the OECD middle class and will be compensated accordingly. The consequence - in the absence of very significant growth in the OECD - is the OECD middle class will see its incomes drop while the non OECD middle class will see its incomes rise. End of story.
08:08 PM on 08/07/2011
An excellent analysis. These facts need to be more widely recognised.
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HUFFPOST SUPER USER
First Blast
won't be fooled again
09:32 AM on 08/08/2011
Another dynamic at work is the exportation of underclass populations to the OECD nations which have undercut wages and jobs.
11:04 AM on 08/06/2011
"And for all governments it is far easier to build a school than to improve the quality of teaching. "

If the general public's quality have not changed, you can not change or improve the quality of teaching.
09:28 AM on 08/06/2011
. The data show that lower wages or job losses in developed countries are not erging economies, but mostly to technological change, anemic productivity, or tax policy and other...I say B.S. Warren Buffet even admitted that manufacturers will shift to the lowest labor cost providers, like NIKE is doing.
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jeffrey678
You don't happen to make it. You make it happen.
09:09 AM on 08/06/2011
"Chilean youth are rebelling against the orthodox free market ideology that dominates everyday Chilean life. High schoolers continue to demand an end to for-profit education."

http://www.guardian.co.uk/world/2011/aug/05/chile-student-protests-violence
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SoylentGreenIsPeople
Hmmm........Tastes Like Chicken !
08:56 AM on 08/06/2011
What is your definition of middle class ??? Be specific ! Many politicians like to manipulate the public using that term. Just because someone has a 40 hour a week job does not put him in the middle class.

55% percent of the people in Chile do not make enough money to qualify for Social Security when they get old. Banking companies skim 30% from Soc.Sec from people who do qualify. They bury the opposition parties six feet under if they speak up. They don't even own their own water and sewer systems. They have to pay a toll to drink water and flush a toilet.
ThePeacemakers
Concerned Citizen
02:40 PM on 08/06/2011
"What is your definition of middle class ??? "

The big question. The answer I've come to is one that will continually be re-defined DOWNWARD all over the world.
Don't believe the lyin' hype.
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HMDMSR
Workers of the world, unite!
01:42 AM on 08/06/2011
We need to be careful about word usage, here.

In France, in the estate system, the bourgeoisie were those Third Estate citizens who were becoming wealthy within the developing market economy; they were "middleclass," lying somewhere between the First and Second Estates (together, high society), and the common peasantry of the Third Estate (low society).

In modern economies the middleclass is made up of small business owners; professionals, such as scientists, engineers, teachers, to name a few disciplines, and what's left of the more well-compensated "blue collar" workers. Most members of the middleclass in a modern economy are working class.

Given the above considerations, today we reserve the term "bourgeois" to represent the business class. Some middleclass members are petty bourgeois (small business owners and some professionals, such as lawyers and physicians, who own their own practices--in effect, business owners). Most of the middleclass is not made up of folks who are direct beneficiaries of the capitalist economy, so most of the middleclass is working class, not bourgeois
oilfield
small manufacturing business owner
10:47 PM on 08/05/2011
every year we make more laws and rules....our government is overbearing to the point where kids cant have lemonade stands in a lot of cities.
wsdave
Abusive or Insulting? I won't be responding.
04:21 PM on 08/06/2011
And NOTHING builds the entrepreneurial spirit of children like having your lemonade stand shut down.

Tomorrow's business owners being destroyed today.
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jabailo
(Participant) Texeme.Construct()
10:09 PM on 08/05/2011
The good news is that the ROW has decreased its birth rate down to near 2 and will eventually reach below replacement rate like the US (all except for Africa which is sure to catch up).

The US has been victim to to hierarchical systems that are not reflecting the true value of the middle class and its services. The monetary system is overweighted because first access to dollars and prime interest is restricted...the average person hasn't a clue how to dip his hand into the cookie jar and by the way, if he ever figured it out, by the time he gets in there the cookies are all gone...
07:28 PM on 08/05/2011
Unfounded accusations? Offshoring is a myth everybody. Unnamed research says so. Phew. I was really beginning to worry that all the things we import that used to be made here was somehow connected to unemployment.

I can sleep well tonight.