Can Davos Leaders End the Political Turbulence That Has Been Building for Years?

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REUTERS/Ruben Sprich

The World Economic Forum began in Davos on Tuesday. This year's session, on the theme of responsible and responsive leadership, will focus on how best to address the "growing frustration and discontent increasing in segments of society that are not experiencing economic development and social progress." The political turmoil of 2016 is widely seen as underlining this anguish with a growing anti-establishment, anti-globalization mood across much of the world—to the alarm of many in the political and business communities who attend Davos.

There was no shortage of evidence of this mood last year, from the United Kingdom voting to leave the EU to the election of Donald Trump as U.S. president, and the rejection of Italian Prime Minister Matteo Renzi's constitutional referendum.

But while some may see 2016 now as a potentially defining historic moment, the fact is that unusually high political turbulence has actually been a feature of politics for much of the last decade—at least since the global financial crisis began in 2008. Partly because of economic downturn and austerity measures, many governments in the industrialized world have since been voted out of office.

Millions took to the streets in Europe alone, where more than half of EU states fell or were voted out of office from spring 2010 to 2012 alone. Within the core eurozone, 11 of 15 governments then in the single currency collapsed or lost elections during that same two years.

Another notable feature of protest in the developed world has been the 'Occupy movement' that came to international prominence in Wall Street in 2011 in its campaign against social and economic inequality. The Occupy demonstrations spread to some 1,000 cities and over 80 countries, from Canada to Norway to New Zealand.

This is just one feature of a range of exceptional economic and political fragility and uncertainty across the world in the last decade. In emerging markets and developing countries, there have also been political revolutions, popular uprisings and protests.

This includes the so-called 'Arab Spring' which began in Tunisia some six years ago and its subsequent spread to include revolutionary changes of power in Egypt and Libya; transfer of power in Yemen; plus demonstrations and uprisings in countries as disparate as Algeria, Bahrain, Jordan, Morocco and Oman.

There was also the Ukrainian revolution of 2014, which resulted in the ousting of pro-Moscow President Victor Yanukovych; the Brazilian demonstrations of 2013, the largest in the country for some two decades; and the 2011 Azerbaijani protests against the government.

This disparate range of political disruption across the world has reportedly been described as "a revolutionary wave, like 1848" by Sir Nigel Inkster, former director of operations for the U.K. Secret Intelligence Service. Others have compared the situation to years like 1914, 1968 and 1989.

Whatever the validity of these historical analogies, however, it is clear that there are some genuinely new factors playing a part in the post-2008 period, including the role of social media and other technologies. Moreover, this so-called "wave" of political instability has diverse origins—with economic issues not the only cause.

Unrest in the Arab world has often stemmed from deep-seated political and socio-economic discontent that pre-dates the financial crisis. But post-2008, factors including liquidity crunches, increased food prices, and unemployment spikes, have exacerbated these longer-standing grievances.

In Europe, the role of economic downturn and austerity has been central to unrest in numerous countries, especially those most impacted by the eurozone crisis. Even here though, pre-existing disquiet with established political parties has exacerbated the unrest, as seen in the meteoric rise of new groups like Syriza in Greece.

Going forward, a key question is whether overall political instability will now tail off, especially if economic growth accelerates and sustains itself in much of the world in coming years. While this is possible, there are at least three sets of factors that will continue to fuel protest in some countries.

Firstly, economic inequality has grown in many countries, and becoming increasingly politically salient. This was underlined by Trump's victory, where his populist message tapped into the anger of discontented voters who felt 'left behind' and often angry at the increases in income inequality since 1980.

Secondly, even if the worst of the financial crisis has now passed, its consequences persist, especially impacting the young. People aged 15-24 constitute less than 20 percent of the global population, but approximately double the percentage of the unemployed. This puts many at risk of long-term damage to earning potential and job prospects, fueling discontent.

In many countries in the Arab world, youth unemployment is above 50 percent—many of whom have college degrees but no possibility of employment. (The problem is particularly acute in the Middle East, which has one of the world's biggest youth bulges.)

And even in the EU, more than 5 million people in the EU aged 15-24 are unable to find work (around 20 percent) as traditional career opportunity structures have been swept away. This has given rise to concern, including from German Chancellor Angela Merkel, over a "lost generation", especially in Greece and Spain where youth unemployment has been over 50 percent.

Thirdly, there are drivers—unrelated to the financial crisis—that have been common to much political unrest, that will endure. This includes the disruptive role of social media. It remains unclear exactly how instrumental social media has been in fomenting political instability. But whether one sees it as an essential component that translated discontent into concrete action, or accentuated what was already inevitable, it has no doubt played an enabling role that may only grow as technology advances and proliferates.

Taken overall, there remains a significant prospect of political unrest across the world in 2017 and beyond. While circumstances will vary from country to country, instability will potentially be fueled not just by economic inequality and legacy of the financial crisis such as higher youth unemployment, but also longer-standing political and socio-economic discontent, propelled further by the power of social media to connect the discontented to each other.

Andrew Hammond is an Associate at LSE IDEAS (the Centre for International Affairs, Diplomacy and Strategy) at the London School of Economics

Can Davos Leaders End the Political Turbulence That Has Been Building for Years? | Opinion