Western countries broke its promise of offering opportunities to all. The tacit agreement between citizens and their governments began to fall apart. The pandemic has only deepened this crisis of representation and, during events such as these, it is common for constituents to turn to a leader figure who will solve their problems.
The Covid-19 pandemic has not only aggravated this scenario, which posed a serious challenge even before the Crisis of 2020, but it has also exposed asymmetries and accelerated predicted timelines, heralding the collapse of cycles such as Inequality, Mother Nature, Technology, and Human Spirit during the decade of 2020.
The precariat is the social class that emerged from this period of disenchantment. It is made up of a large number of people facing stagnant incomes, job instability, and academic over-qualification for the jobs they can get. Guy Standing, professor at the University of London, defined three subgroups within the precariat. The first subgroup is comprised of the atavists. They have a low level of education, were raised in families and communities that have experienced deindustrialization, and long for the past. Among them are the many supporters of Donald Trump, Jair Bolsonaro, Marie Le Pen, and the Italian Northern League. They tend to constitute the ethnic majority of society. Next are the nostalgics, made up of ethnic minorities and immigrants who do not feel recognized as citizens or heard by the state. In practice, they are usually regarded as second-class citizens. They are prone to voting for centrist politicians such as the Democrats in the United States. The third group is constituted by the progressives; they foresee a lost future. They are the younger generation who went to university believing in the promise made to them by their families, communities, and teachers: if you work hard, you will have a guaranteed future. (1) But as adults, they realized things are much harder than they expected. Many of them vote for candidates such as Bernie Sanders, and parties such as Podemos in Spain, the Workers’ Party (PT) in Brazil, and Kirchnerism in Argentina.
The precariat no longer belongs to a community that offers security and identity, a sense of solidarity, reciprocity, and mutual support. They cannot even fully exercise their rights as citizens because the system created by the technocracy is so complex that only the richest people have the necessary resources to enjoy it. Their economic distress is mitigated by complex welfare programs aimed at keeping them afloat and dependent on the technocrats but never actually resolving their underlying problems. Governments do the bare minimum to keep them out of poverty.
In consequence, a large part of the political spectrum looks to the past. Make America Great Again, the slogan that touches the hearts of those who long for the United States of 1945–1989, which they see as the country’s best years; populist governments in Latin America who promote statist economic policies akin to those of the 1940s and 1950s; Brexit with its Let’s Take Back Control slogan struck a chord among those who yearn for the mighty Britain of strong leaders the likes of Winston Churchill and Margaret Thatcher.
In the mid-term, demographics will start to play against right-wing populism, while the left will thrive on a generation of young people who are being increasingly neglected and expect more from the state. What happened in Latin America in the 2000s with the rise of populist left-wing governments (often disguised as progressives) could repeat itself in developed countries if liberal governments do not renew their commitment to the middle class and take the necessary measures to rebuild the meritocracy.
Pandemials are the young people born in the years following the fall of the Berlin Wall and entering the job market during the Covid-19 crisis. They are a generation with strong ethical values and ecological awareness owing to having been born knowing that the planet is at risk. They will find societies marked by inequality, the end of meritocracy, solitude, digital automation, the depletion of natural resources, and a variety of environmental crises that will affect life on the planet. In addition to not enjoying the same economic prosperity as their parents –which, for example, allowed them to access a university education or lead more comfortable lives– this generation will face fewer job opportunities, discouraging prospects, and a growing need to radicalize their complaints. As a result, pandemials will expect much more from governments, and when their neglect is not addressed, they will rebel. They will go after the technocratic elites and the foundations of the capitalist system. Liberal governments’ lack of answers to these problems will push them to rekindle old models and left-wing utopias.
Pandemials are carrying out a rebellion in response to the lack of interlocutors or policies to resolve their problems. Their revolution is against the technocracy, the powerful group that has handled public policy since World War II. To them, the technocracy is represented by the political parties who have been in office for the last few decades, bankers, lobbyists, and institutions such as the European Commission or the International Monetary Fund (IMF). They are also rebelling against right-wing populism, rejecting authoritarianism, discrimination, and conservative values on social matters. This new rise in populism, conservatism, and authoritarianism has taken place in a large portion of the world: the United States, parts of Europe, Latin America, and East Asia.
Faced with this situation, liberalism radiates stubbornness and inspires disenchantment: it tries to solve the problems of today using the recipes of the past on a larger scale. The ideology that used to look to the future now turns inward, displaying its inability to renovate its ideas and come out from under the dominion of a self-serving technocracy. This closed-minded even elitist approach does not reflect the essence of liberalism, i.e., the meritocracy and openness that characterizes it. Without a renewal of ideas and a greater openness, the spread of populism will be hard to stop.
GLOBAL GROWTH INCIDENCE CURVE (2)
New, non-statist approaches will be needed to recover meritocracy and provide solutions to the complaints of young people, which range from lower sales and income taxes to more efficient education models such as charter schools, from a serious stance against climate change to a monetary policy that contributes to human progress.
The elephant-shaped graphic reflects the dissatisfaction of the middle class in many developed countries. In it, you can see the global income growth per income quintile between 1988 and 2008. The middle section pertains to emerging countries such as China, whose middle-class incomes grew a lot more. In the 80-95 quintile, the lower rate of growth reflects the middle classes in developed countries. The trunk relates to the rich whose income has grown significantly.
The paradox of liberalism is that in many of the countries where it was implemented, its middle classes sunk into the precariat, while in the rest of the world, the free market and globalization upheld by its ideology lifted millions of people out of poverty. From a global standpoint, the world has never been better off and the percentage of people in the middle class is at a record high thanks to the economic growth of China and other emerging countries. However, this process is losing steam. China’s initial progress, which relied on copying technology and exporting to the rest of the world, is starting to face the limitations caused by a lack of freedom and innovation.
The pandemic struck in this context, which is like an iceberg of problems that we could only see the tip of at first but now it has fully emerged. Following events of this magnitude, two things happen: social and economic processes accelerate and demands for change intensify.
PART 1
THE HUMAN CYCLES
THE HUMAN CYCLES
“The world will never be the same.” “This is the end of liberalism.” “We will see a new world order.” “China will dominate the world.” “Covid-19 was sent by God as punishment for the damage we are doing to our planet.” “The ‘New Normal’ is here to stay.” I read these proclamations and many others like them about
