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How Far Will the Youth Revolution Spread?
by Justice Litle, Editorial Director, Taipan Publishing Group
Ike's Domino Theory is in full swing now. From a Tunisian handcart vendor to Tahrir Square in Egypt, and now to Iran, Libya, Yemen and Bahrain, Middle East revolution is spreading.
It seemed to begin with an out-of-the-blue event... a single domino unexpectedly falling. On Dec. 17, a broken and frustrated youth named Mohamed Bouazizi set himself on fire in the Tunisian town of Sidi Bouzid. All of Tunisia then rallied in anger.
There is natural comparison here to Gavrilo Princip, the Yugoslav nationalist who assassinated an archduke and touched off World War I. That opportunity came about because of a driver mix-up.
If Franz Ferdinand and his wife had not made a fateful wrong turn that day, would Europe have still marched to war? If Mohamed Bouazizi had not despaired of all hope for the future, would multiple "strong men" still have been toppled?
The picture cannot be confined to a one-off event. In order for revolution or war to occur, surrounding conditions have to be just so. One could compare a dangerous situation to an extremely dry forest, crackling with dead underbrush after a long period of drought. With conditions like that, a single cigarette butt or errant campfire spark can fuel an inferno.
In the Middle East, the dry tinder of resentment had been building up for a very long time. Now it is fed by the flames of angry youth. In many Middle Eastern countries youth under 30, and in some cases under 20, make up the majority of the population. Many of these are restless, angry and unemployed.
And then there is the "social" aspect to the revolution. The gatherings in Tunisia and Egypt were more professionally managed than ever before. Tools like Facebook and Twitter were used to organize gatherings and share valuable hints and tips, such as the best way to counter tear gas. (Put vinegar or onion under your scarf.)
When President Mubarak stalled before fleeing the country, many believed the main goal was buying time to move assets to safety. Western intelligence services now seem to confirm this. Estimates of the Mubarak fortune, accumulated over decades of iron-fisted rule, range from $3 billion to a whopping $40 billion.
With Mubarak out there is talk of freezing these assets, particularly in Swiss and U.K. accounts, as the rightful property of Egypt. There is also talk of trying Mubarak for corruption, with some Egyptians arguing he should be executed a la Saddam Hussein. No wonder the man looked pale in his televised speech. He was thinking about his neck... and his gold.
For the most part Westerners cheer as they take in this grand sweep of history in the making. As old hands at democracy, we in the West are proud to see a new taste for freedom sweep away old regimes.

But there are grave parallels here too -- comparisons that should deeply concern the West. After all, it is not just the Middle East that is populated by angry, disaffected youth. Nor is it just the Middle East dealing with potential food shortages and a mounting cost of living for those who can least afford it. As Businessweek reports,
... [R]ich democracies ignore youth unemployment at their peril. In the 34 industrialized nations in the Organization for Economic Cooperation and Development, at least 16.7 million young people are not employed, in school, or in training, and about 10 million of those aren't even looking, the OECD said in December 2010. In the most-developed nations, the job market has split between high-paying jobs that many workers aren't qualified for and low-paying jobs that they can't live on, says Harry J. Holzer, a public policy professor at Georgetown University and co-author of a new book, Where Are All the Good Jobs Going? Many of the jobs that once paid good wages to high school graduates have been automated or outsourced.
... Although the recession ended in the summer of 2009, youth unemployment remains near its cyclical peak. In the U.S., 18 percent of 16- to 24-year-olds were unemployed in December 2010, according to the Labor Dept., a year and a half after the recession technically ended. For blacks of the same age it was 27 percent. What keeps the numbers from being even higher is that many teens have simply given up. Some are sitting on couches. Others are in school, which can be a dead end itself. The percentage of American 16- to 19-year-olds who are employed has fallen to below 26 percent, a record low.
Meanwhile David Goldman, who writes as "Spengler" for the Asia Times, openly wonders what will happen to Egypt (and other Middle East countries) if China's wheat crop fails:
Not until June will we know the extent of the damage to China's winter wheat crop, virtually all its production. Extremely low rainfall this winter parched more than 5 million hectares of 14 million hectares planted, and the next few weeks' weather will determine if the world faces a real shortage of the staff of life.

Hoarding on the part of North African countries, starting with Algeria, has already pushed up the wheat price in the Mediterranean to a 20% premium over the price shown on the Chicago futures market. The immediate risk is that pre-emptive purchases of wheat will price the grain out of the reach of poor Egyptians, not to mention Pakistanis and Bengalis.

And if reserve-rich China, usually self-sufficient, goes into the world market to buy millions of tons of wheat, the price of wheat can rise to an arbitrarily high level.
The dictators are going, but for many of these countries the food may be going too -- priced out of the average consumer's hands. (Via Spengler, roughly 40 million Egyptians live on less than US$2 per day.) In Egypt and elsewhere, we can expect more anger ahead.
In the West, stomachs are not so empty. But at the same time, Westerners have a much lower threshold for acceptable hardships -- and young Western individuals, often with education but no solid employment prospects, can see the writing on the wall.
As it becomes more apparent that reflation-based monetary policies are hostile to those with limited discretionary income and those without jobs, the potential for youth unrest in the U.S. and Europe, not just the Middle East, will grow.