Opinion

Chrystia Freeland

Revolutions are all about jobs

By Chrystia Freeland
March 4, 2011

There’s nothing like a few revolutions to focus the mind. The lesson the world’s smartest authoritarians are drawing from Tunisia’s Jasmine Revolution and its neighborhood copycats is simple: It’s all about jobs.

“The leadership in China is always worried about how do you stay ahead of the growth to create enough jobs,” says Dominic Barton, the global managing director of consulting firm McKinsey, who has lived in Asia for much of the past decade. “They have to create over 30 million jobs a year. … They know that if they don’t and there are disruptions and the people don’t have jobs, there will be revolution.”

To illustrate how focused China’s Communist rulers are on jobs, Barton described work he had done helping the Chinese government structure its economic stimulus in the aftermath of the 2008 financial crisis. The Chinese authorities came to him with a very specific question: What sort of discount should you put on TVs in Tier 3 cities? “It was a very focused question. And the reason was, they were trying to create consumer demand in a very sophisticated manner.”

The mandarins wanted McKinsey’s advice on how exactly to implement their TV stimulus program: Should the price of televisions be cut by 25 per cent, or should consumers be required to pay the full price, then apply to their mayor for their 25-per-cent rebate? Barton says that once he understood how precise the request was, he “did the McKinsey thing” of talking about how important it was to make sure the project worked and had an impact. One Chinese official wasn’t impressed by his spiel, Barton recalls: “He says, ‘I think we have a different definition of impact than you … If this doesn’t work, we are going to have probably 12 million people that won’t have jobs. And you should know that all of the revolutions in our 5,000-year history have occurred in the countryside.”’

The Middle East’s remaining autocrats are swiftly learning the Chinese lesson, as illustrated vividly by Saudi Arabia’s new $36-billion (U.S.) stimulus program, which includes a 15-per-cent pay increase for public sector workers. As Jack Welch, the former chief executive of GE, described it this week, “In this recession, China did incredible things,” adding that “it is a little bit like what the Saudis are trying to do now to keep everyone happy.”

As Barton’s Chinese interlocutor readily acknowledged, these regimes’ concern about keeping their people employed is hardly selfless. Both China’s long history and current events in North Africa show the smart autocrat that if too many of his subjects are unemployed, their supreme leader is at risk of losing his job, too. Moreover, instant job creation is easier in economies where the state plays a dominant role — and that is particularly true for power exporters such as China and Saudi Arabia, who have plenty of cash on hand. Nor do government handouts — especially in oil-dependent Saudi Arabia — necessarily offer a path to long-term economic growth and job creation.

Even so, the authoritarian regimes’ preoccupation with jobs is in striking contrast with the United States, where despite nearly record levels of unemployment, the central issue in the political discourse at the moment is cutting government spending, a major gripe for the U.S. left, which correctly sees that less state spending will mean fewer jobs.

It isn’t only the progressive activists who think jobs needs to be at the center of the U.S. national conversation. Welch, an outspoken Republican, says: “Why did we spend a whole year fighting over health care and ignoring jobs?”

Google chief executive Eric Schmidt calls unemployment the No. 1 issue facing the country. Like those Chinese mandarins, he has a proposal. “The best way to solve that problem is to have a construction boom,” he said in an interview. “The best way to have a construction boom is for the government to create liquidity in markets that are debt-related to build whatever they care about. My favorite one is energy — rebuilding America’s energy infrastructure, insulating all the homes. This requires lots of construction. And these are nice, local American jobs.”

Both Welch and Schmidt are very worried about government debt. But governments need to be able to do more than one thing at the same time. The Arab uprisings have reminded the world’s dictators that not worrying about jobs could undermine their own job security. Kicking out elected leaders who can’t provide jobs is even easier.

Comments
13 comments so far | RSS Comments RSS

Allow me to disagree at some point in your article. I just spent 5 months in Libya and I can assure that unlike Tunisia or Egypt there were plenty of jobs in the streets: no wonder many foreigners, including myself, arrived to these lands looking for job opportunities. Even the locals that I met were happy with their emerging economic situation after the 2003 embargo lift, which gave them new hope and opportunities to attain personal welfare, and any foreigner who just landed there could tell that there was much economic activity going and people working really hard with hope. Besides, those who didn´t have homes, the regime provided them for free with new houses, maybe not the best quality houses, but after all a new house for them. Also, families in difficulties received some monthly allowance too, maybe not much enough, but still they were taken care of. And one more thing: regarding what we see in the news, in the period that I was there, in Libya, anyone could watch freely the satellite news (BBC, CNN, etc…) without any censorship: you got into any convenience store or cafe and the people were watching the news without any problems. People with personal internet connection could freely access facebook or read any foreign news, like I did myself. Only the public administration filtered the internet connection to their employees, but under personal use at home or in business, I saw no censorship at all. It´s a pity that a country that was slowly emerging from obscurity has to go through this disaster and destroy all the past efforts to improve. After reading this, you could ask: “if that was so, then why did this happen all of sudden?” Well, you ask me, I don´t know why, maybe the sudden openness and freedom of media made people believe that they were under oppression, but believe me, the locals were free to watch, listen and speak whatever they wanted regarding the world and the government in the cafes and streets, and in general, people were hopeful and anxious to improve their own welfare after the 2003 embargo lift.

Posted by kmgus | Report as abusive
 

The smartest authoritarians huh..where do they get this? Hopefully some day the US will raise the smart bar back to a previous state. I have a saying. It must have been an idiot who came up with the word genious because a genious would never call himself that. The wording alone sends off alarms suggesting we know the end. No we dont. Weve made a mess of our own country and cant seem to grapple with fundamental spending behaviours. The countries downfall led by some of the countries smartest. ..nuff said. The issues in the middle east of course a product of the problem is no jobs. Its more than that and should be recognized. You can pay off your kids and get them to behave. Gift them and gift them but it has its downfalls. You arent teaching them anything and you set in motion a habit that will be impossible to meet somewhere down the road. The entire authoritarian system is defunct. Will always require some bribe to by its position. Simply because it cant stand on its own influence. without the bribes people are gonna raise hell. Get rid of the mentality of im the authority and your not, im the king and your not, im smart and your not, so i rule and you abide. Raise the standard of overall life in the populace and people participate in the raising of the standards of the nation and build it to a quality level. Rather than the few assumed smart people the true talents about the nation will come forth and add to its growth. The underlying problem in the middle east isnt about jobs its about so much more and again lack of jobs is a product of the problem. Look more thoroughly . Strain that ole brain as all things are related in this situation. The causes and effects.

Posted by MrEz | Report as abusive
 

If jobs are really the difference, simply providing more of them will not suffice. The Saudi solution of jobs with wage increases seem to be significant in their having, thus far avoiding the unrest seen in other Middle Eastern countries.
Here in America things are more complex. What is going on here is really more like class warfare with the elite reasserting domination over the working class.

Posted by tedvandell | Report as abusive
 

All very well. Now can anyone tell me why Libya has at least a couple of hundred thousand foreign workers and why the Libyans are not filling these jobs?

Posted by Biscayne | Report as abusive
 

We subsidized construction works for a decade already with the consequences that we see today. In the meantime neglecting the electronic manufacturing technology that is now dominant in Asia. While investing in energy saving homes is a good thing, it will not do much for the homes that r foreclosed every day and remain empty for long. We need local jobs and local production. Did u ever got a call from a service rep. from a guy in India or the Philippines? Just make outsourcing abroad non tax deductible and u will see improvement. But ha… the big corporate lobbies might think differently… good luck then… :)

Posted by robb1 | Report as abusive
 

As others have said, it’s not just about jobs. It’s about lack of food and expense of the food that is available. It’s about the internet – people gaining access to a world wide web that shows them clearly how much better their lives ought to be. It’s about a world where problems can only get worse because our political systems cannot cope with oil shocks and limited oil supply.

And even my explanation is way too simplistic.

Posted by Beery | Report as abusive
 

I wonder to what extent the US pullout from Iraq and the drying up of all of the money that came with it is implicated in the present middle eastern situation.

Posted by Soothsayer | Report as abusive
 

The turmoil today, started a couple of years ago, it’s about “food!”. Wheat/grain harvest have fallen and prices are up much higher, when the people are hungry, rage in the streets comes next. Unemployment is being used as a cover. Watch the world grain commodity harvest & prices and follow the unrest. To many mouths to feed and not enough grain production, period.

Posted by Graff | Report as abusive
 

“Why did we spend a whole year fighting over health care and ignoring jobs?”

Because jobs empower people and make them independent. They do not create a sense of obligation to political parties and it is difficult to target the benefit of jobs to your core constituency.

There have been many irrational and irresponsible acts by the Republicans and they are pathetically obsequious to anything their flakey, rich, uber-conservative donors want, but the mode of operation for the Democrats is to take things away from people so they can give them back in the form of government programs (which they can control and target).

Posted by ARJTurgot2 | Report as abusive
 

Revolutions aren’t about jobs. They’re about creating the opportunity to make real money.
Sterling Greenwood/AspenFreePress

Posted by AspenFreePress | Report as abusive
 

All information we have are from our media. We name sides in the case of Libya: Gaddafi supporters and Libya rebels. When similar events happen in countries we support that there are different entities in the game: legally chosen government and terrorists. And our position about terrorists is well known. Money distribution in all these countries is very similar: dictators with their family/supporters – read military have most of resources and money; the rest lives as allowed by rulers. All the power is in hands of few. People want change in this disproportion, very simple.

Posted by Pred | Report as abusive
 

To a certain point you are definitely right about Jobs. And it is interesting to compare the higher priority of dictatorships in keeping their people happy than democracies.

But the real point is about a person’s ability to make enough cash to marry, settle and have kids. If young people have enough money to start a family, they have too much to lose in a revolution. If they are working and still don’t have enough money, they are better organised and is some ways more dangerous, unemployment dulls the soul.

That is why so many revolutions start with students.

Posted by Dafydd | Report as abusive
 

The phrase “Revolution of Rising Expectations” covers the roots of most revolutions. People see the ready possiblilty of a better daily welfare as those around them or that they hear about, earn more and have more. Private hopes and wishes become public grumbling; public talk gathers together those with the same leanings; leaders emerge; pamphlets (as in the American Revolution) are published or words flow via social media on the internet (today) and voila the hot coals are ready to ignite with the right spark.

It is not people at the end of their ropes who revolt but those who have enough rope left to climb and see what might be.

Posted by mikeymouse03 | Report as abusive
 

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