Are Things Getting Out of Control Under Capitalism?

Political, economic and social crises are extraordinarily complex in an unstable world. This article approaches them with a degree of simplification, revisiting political thought and geopolitical transformations at a time when the major historic political parties are absent from the political landscape. It is also an acknowledgment of the need for sociologists to examine the intertwined trends shaping modern urban life and the rapid changes it is undergoing.

Never have societies been so sharply divided along class lines as they are today, nor have populations participating in different protest movements been so exposed to external influences. These tensions are also reflected in the riots and disorder now seen in numerous cities. Such developments are nothing new in France and Europe on the eve of elections, particularly given the activities of Islamist movements within democracies that tolerate these excesses, to the point where violence becomes an end in itself, devoid of any political objective.

In some respects, the Yellow Vests revolt, which ended six years ago, was even more violent in its clashes involving radical groups. Nor are these phenomena confined to Europe. They have also emerged in the United States and the Middle East. What makes the present situation different, however, is the accumulation of crises confronting countries simultaneously, not to mention two wars weighing heavily on European economies and fueling political tensions.

This convergence of crises is also troubling young people around the world. A few weeks ago, spontaneous protests by students at French high schools helped trigger broader unrest. Their anger over dilapidated schools, the shortage of teachers and the difficult path to higher education reflects widespread anxiety about an uncertain future, one they nevertheless want to be part of and help shape.

They fear job losses caused by artificial intelligence and foresee a bleak future overshadowed by the climate crisis and a deteriorating international order. While their grandparents enjoy secure retirements, these young people will have to shoulder the cost of rising pensions and an expanding national debt. University students, teachers and even the Yellow Vests, who have reappeared on the social scene, have therefore joined the leaderless high school protests, bringing their own demands in response to the rising cost of living and unbearable fuel prices.

These disparate living conditions have now become a political issue caught in a deadlock. Such a transformation will pose an economic challenge to the middle and lower classes and require careful consideration by policymakers, taking into account inequalities between the central state and the periphery, as well as pockets of entrenched poverty, immigration and isolation. These divisions are driving young people toward uncivil and lawful methods, while security forces lose control when confronted with crowds of looters and vandals attacking the heritage of major cities.

Politicians and analysts seem at a loss to comprehend the different forms of violence unfolding before them. The authorities are failing miserably to enforce law and order, yet they overlook the bigger picture of persistent political, financial and social suffering. What makes the current situation different is precisely the accumulation of crises. The present unrest has therefore raised fears of further global deterioration, as rising fuel prices, inflation, dissatisfaction with the condition of schools, declining public services and the housing crisis have created a perfect storm of protest across Europe this autumn.

Crowds have taken to the streets of major cities in France, Italy, Albania, Spain and Portugal. Protest encampments have sprung up to denounce unaffordable rents and living costs. Young people are disillusioned with the capitalist-oriented social model and are experiencing a profound sense of uncertainty and loss of control.

As far-right parties make electoral gains in Germany, and may do the same elsewhere, socialist parties are struggling with a loss of political purpose. All this comes at a critical moment for Europe's support for Ukraine, while President Trump courts President Vladimir Putin.

Right-wing politicians have exploited this chaos. As protests in France appeared to be spreading on a large scale, Trump portrayed immigrants as responsible for the destruction. He wrote on his Truth Social platform: “Immigrants have taken over France. They need to close the borders, and fast!” The French authorities, however, have resorted to legal means and have blamed neither immigrants nor demonstrators demanding the protection of healthcare and education.

In Serbia, university students have been leading mass protests against corruption for nearly two years. They are now demanding the annulment of the results of the snap parliamentary elections won by the powerful populist party of President Aleksandar Vučić.

It is difficult to see how higher taxes and increased spending on weapons could solve the problems of inflation. Naturally, according to some supporters of the protests, capitalism is to blame.

French economist Thomas Piketty argues that “the country's problems are the result of following the capitalist logic of underinvesting in the public sector and failing to tax the wealthy sufficiently.”

When it comes to taxation, France already imposes a heavy burden on wages and consumption, particularly through personal income taxes. French taxpayers provide 74% of revenues, with the richest 1% contributing one-third of that amount. France also has the highest corporate tax rates of any country in the Organisation for Economic Co-operation and Development (OECD).

There is therefore genuine sympathy for young French people who protest without resorting to violence. The French economy is largely moribund because retirees dominate public finances, consuming 14% of gross domestic product. One reason education spending is so constrained is that one-third of the education budget goes toward pensions.

When protesters speak of feeling “hopeless,” they often mean that the “profit train” will have left the station before they have a chance to board it. Yet it is difficult not to see this as a failure of capitalism or “neoliberalism.” Salvation, however, will not come through socialism either. As Margaret Thatcher put it: “The problem with socialism is that you eventually run out of other people's money.”

France may be an exceptional case in its weak economic performance and excessive spending, but its problems are familiar elsewhere, including in the United States, whose economy has grown twice as fast as France's over the past quarter-century. Yet the demands voiced by young Americans concerning “capitalism” echo those of demonstrators protesting in Paris.

France has a system of universal healthcare coverage. That has not spared it political unrest and violence, which are certainly linked to the integration of immigrants from North Africa and the Middle East, or to budget cuts.

It is always fascinating to watch a game of dominoes, where the last piece can set all the others in motion. Yet the game has not truly begun when it comes to explosive demographic trends, which cannot be addressed through security measures alone.

Nor can political will, by itself, resolve these challenges in aging societies that need immigrants as their populations decline and fertility rates fall. At the same time, these societies are experiencing substantial immigration toward the West, concentrated in the suburbs, while urbanization advances faster than economic development.

What we are witnessing is the transplantation of rural life into urban areas, depriving cities of their economic and social dynamism, as illustrated by the experience of large cities in some African societies.

Could the bond market itself erupt amid a looming sovereign debt crisis, with borrowing costs and debt levels relative to GDP higher than they were in the 1990s? The result is enormous pressure on public budgets.

There are growing doubts about the credibility of legal institutions, while the pursuit of money has turned into a form of nationalism managed by an oligarchy. This is reflected in President Trump's suggestions that “inflation could reduce debt!” amid the energy shock caused by the war in Iran.

Meanwhile, achieving constructive strategic stability in the Gulf is becoming an increasingly difficult objective after the midterm elections, against a backdrop of personal rivalries and backward-looking nationalist visions, with horizons seemingly frozen in 2003.

As for Lebanon, it is but a speck in this storm-tossed sea, itself engulfed by its contradictions and divisions. Will it grasp the changing nature of international relations and the risks they entail, or will it continue operating under the old system, without modernizing the structures of the nation-state or reviving development and cultural life?