Across north Africa and the middle east, ruling elites watch the popular insurrection in Tunisia with concern and even fear. There are already some indications that the uprising there is emboldening oppositions elsewhere, not least in Egypt and Algeria.
The talk of a domino effect aided by the internet and social media may be premature, in part because these tools are far less widespread in much larger and poorer Egypt. More significant in any case has been the broadcaster Al-Jazeera's massive coverage of Tunisian issues.
This is partly because some elites are already starting to limit and even co-opt opposition: often with more cautious public-order control than the Tunisian regime showed, but also by accepting the need to ease the more severe economic problems such as rising food prices. Such moves may not prevent an upheaval in Egypt - the country to watch - but it is still enlightening to see the upheaval in Tunisia in a far wider context.
A global dimension
In matters of world economy, the first five years of the 21st century saw widespread growth: steady in most countries, rapid in the largest emerging economies (notably China and India). Even at the height of the Iraq war and (at that time) the low-level Afghan conflict, western analysts could here find some consolation.
That changed dramatically in 2007-08 with the United States’s sub-prime crisis. The unravelling of the system of multi-billion-dollar collateralised debt obligations - often complex bundles of credit-default swops - soon threatened some of the world's largest financial institutions. Massive government bailouts in western Europe and the US averted collapse, but many countries will be paying the price for years to come.
The ensuing economic stringency has provoked strong public opposition in many countries, including mass demonstrations and some street violence. These trends are likely to be further stimulated by the current round of salary and bonus hikes by some of the biggest financial institutions. Goldman Sachs, for example, paid its 6,000 staff an average of just under $500,000 in 2010; and it has removed the bonus “cap” of $1.6 million for each of its 500 leading staff. All this at a time of rising unemployment across western economies.
True, there is evidence from the growth of vibrant Asian economies and other regions that the world economy as a whole remains on course, with further expansion anticipated. China reports an extraordinary 10.3% increase in GDP for 2010 and India continues to grow apace.
A deeper view offers a different picture, however. A theme of this series of columns is that rapid growth in India is matched by deep inequalities whose fruits include a resurgence of the neo-Maoist Naxalite insurgency, which now affects around half India's states (see "India's 21st-century war", 5 November 2009).
In China, too, rapid growth also intensifies widening divisions. By the start of 2010, the richest 10% of the Chinese population controlled 45% of the wealth and the poorest had just 1.4%: a wealth-poverty ratio of 31:1. This is leading to rising social tensions - including frequent strikes, demonstrations and riots - which are now regarded by elements in the Chinese leadership as the worst problem facing the country (see Mitch Moxley, “As Poverty and Privilege Clash, Social Tensions Rise in China”, TerraViva/IPS, 14 December 2010).
