Pocketbook Protests: Small Price Changes that Trigger Mass Protests

Sometimes it is the tiniest spark that lights the largest fires. Small pocketbook items have become the catalysts for large-scale protest movements around the globe in the past months. A four-cent raise in metro fares in Chile, fluctuations in the price of onions in India, and a twenty-cent tax on the use of the messaging service WhatsApp in Lebanon have sparked large-scale mobilizations of citizens who are protesting more systemic concerns of income inequality, deteriorating economic conditions, and government corruption. In each of these three countries, discontent had been mounting for months prior. However, a seemingly nominal price change served as the immediate tipping point. What is it about the price of a metro ticket, a WhatsApp message, and onions that served as the last straw? A common significance weaves through these three goods: they are largely symbolic of systemic inequity and the taxes imposed are regressive in nature, therefore representing the larger grievances of economic disparity and government efficacy shared among protestors.

Chile: Thirty Years, Not Thirty Pesos

The Santiago Metro system weaves through the highly disparate neighborhoods of the capital city of Santiago. It serves to coalesce all strands of Chilean life: the businessman commuting from the affluent suburbs, the student racing to attend university class, the worker departing from the city peripheries for work in the urban center. The metro system is a paradigm for the spatial inequality present in Chilean society, a microcosm of Chilean life. Such an apparent juxtaposition of these disparities came to the forefront of the nation’s attention in October when an unanticipated hike in the price of metro fares led to staggeringly violent protests that, until the recent COVID-19 outbreak, had yet to terminate.

On October 6, 2019, the Chilean government announced a 30-pesos increase — a 4-percent hike —  in the Santiago metro fare price. That day, students in Santiago called for widespread fare evasion through social media, as a relatively indifferent President Sebastián Piñera was spotted celebrating his niece’s birthday at an upscale pizza restaurant. Student turnstile-hopping rapidly devolved into larger demonstrations and chaos. Looting in stores, rioting in the streets, and the torching of twenty-two metro stations led Piñera to issue a state of emergency on October 18th, sending armed military out onto the streets and installing a curfew across the nation for the first time since Chile’s return to democracy in the 1990s. Succumbing to protester demands, Piñera ultimately canceled the metro tax and replaced his cabinet members; however, the nation-wide revolt persisted, protesting economic inequality, rising costs of living, and the neoliberal model that served as the foundation of Chile’s widely-boasted stability and economic success. Indeed, the metro tax had drifted from the center of the protesters’ concerns.

The protests were not about the thirty additional pesos in metro fares but about thirty years under neoliberal policies that have led to massive inequality. Chile was once applauded by economists as the “miracle of economic growth” and an “oasis of neoliberal success in Latin America.” The country underwent a rapid economic restructuring that opened up its economy to the world market and privatized key public services from pensions and healthcare to water. The country developed quickly, becoming the first Latin American country to become a member of the Organisation for Economic Co-operation and Development — albeit with the highest rates of inequality in that group. A 2017 UN report found that the richest 1% of the population earns 33% of the nation’s wealth. Polls in Chile reveal that dissatisfaction with the country’s economic model had been mounting for months prior. Yet, it was a metro tax that ultimately transformed this growing discontent into mass demonstrations.

It was not the Santiago Metro system that was at the top of their concerns — it was what it represented. To Paola Jirón, Professor of Anthropology at the University of Santiago and director of the Chilean inter-university mobility research center Núcleo Milenio Movilidades y Territorios, inequality is not a static concept, and the concept of mobility stands at its core. She explains in an interview with the HPR that “through the way that we move, we can observe other types of inequalities — in terms of gender, age, and disabilities, but also in terms of income and socioeconomics.” The Santiago Metro is one of the few public services in Chile that reach the poor on the city periphery and connect them with the well-off urban center. Through such a layout, the lower classes depend far more on the metro to reach their jobs and to access city amenities. Jirón explains that “living in poor areas…you have to move around the city to gain access to better schools, better hospitals, and better services. When the fare is increased, it becomes even harder for you to move.” The regressive fare hikes made the act of movement even more difficult, hitting the working-class, who relied on it the most for mobility, the hardest.

As a result, the metro fare protests came to represent deeper distress with spatial inequality and the government system that perpetuated it. Researcher Juanizio Correa estimated transport expenditures for an average family — he found that for a low-income household, transport costs represent 28% of an average family’s income, while for a high-income household, it is less than 2%. The metro quickly became a symbol of the extractive nature of the Chilean state under the current neoliberal model — where profit could be derived in any public service, from water to mobility — and therefore served as a powerful target for protesters. Professor Jirón explains that the students were truly protesting about, “how the fare is connected to the whole system of living… because 30 pesos is an add on to their pension, their healthcare, their rent, essentially their whole cost of living.” The government’s violent response to the protest only added further fuel to the fire. As a result, “something that seemed very small, wasn’t that small at all because it was linked to the government’s response… and the entire system of living.”  

India: Onion Prices Up, Governments Down

As the New York Times frankly puts it: “when the cost of onions goes up, governments can come down.” Indian elections have been lost over the price of onions, and even political campaigns rely on this vegetable as a metric of their success. Like the Chilean Metro system, onions have gained national importance due to their regressive and symbolic nature. In India, onions are a political vegetable.

In October, the soaring price of onions in India caused farmers to block highways and mount short-lived protests. After onion prices increased by roughly 220% due to heavy rains and flooding, the Bharatiya Janata Party-led government banned all onion exports — a common measure implemented by Indian governments to stabilize onion prices — to stave off consumer outrage. However, the fall in onion prices to protect consumers sparked protests by exporters and farmers in the northern region of Maharashtra, where state elections loomed in the coming weeks. Brandishing garlands of onions around their necks, Indian opposition parliamentarians walked into the legislative assembly to demand a price ceiling on onions, blaming the government for breaking its promise of price control. This time in India, though, frustration did not sharpen into mass demonstrations, as there was no collective coalition to channel the discontent.

However, a lack of broad-scale demonstrations has not always been the case. In 1980, rising onion prices were used by Indira Gandhi to topple the otherwise credible incumbent government; she employed the soaring vegetable price as a metaphor for the economic failures of the previous government. Then, in 1998 during state elections, onion prices resulted in the chief minister of Delhi losing the assembly elections. Milind Murugkar, a columnist of The Indian Express and a food policy researcher, describes in an interview with the HPR that this event served as “a turning point when Indian politicians realized that onions were a very important issue [that] can cost them dearly.” Onions reached national prominence in 2010 — a year marked by the “Indian Onion Crisis” — as a dramatic rise in the cost of onions led twenty-thousand people to demonstrate on the streets of New Delhi protesting the price rise and corruption in the government. The protesters wore garlands of onions around their necks to protest inflation in the prices of basic commodities. Onions had become a national symbol for larger economic and political concerns.

Onions play an important role in Indian cuisine, to such an extent that they are widely regarded as the “poor man’s vegetable.” They are a staple crop for the poor, serving as a key ingredient in dishes ranging from spicy curries to biryani. On the other side, the onion is representative of the economically constraining situation small farmers experience in India. Murugkar explains that for farmers, growing onions “is always a gamble” due to the volatility of prices, “but they don’t have many options, so they keep on growing onions.”

Onions, though, more broadly shape the economic opinions of citizens. They are seen as an indicator of the health of the Indian economy as a whole, a thermometer for the degree of inflation. The routine nature of onion consumption allows consumers to quickly notice increases in their price. As such, a Planning Commission member for the Indian government describes that “to afford or not to afford an onion is how poverty is understood across the country.” They are symbolic of the large, Indian working class and their struggles. However, Murugkar explains that using onions as an economic indicator is “quite irrational.” Onion price fluctuations are quickly rectified through new cycles of harvest or immediate imports. As a result, the onion’s potency as a political symbol of government neglect and rising costs of living trumps pure economics.

Simple solutions can be implemented to tackle the economic uncertainty and political saliency surrounding this crucial vegetable. However, with a lack of effective food policies currently in place, onions remain representative of the broader government ineptitude in addressing citizens’ needs. Largely, the onion market remains riddled by government corruption. Characterized by an ineffective government monopsony that looms over the onion market and inefficient supply chains, where middlemen create fake scarcities by hoarding onions until their price rises, consumers and farmers are the primary losers. The key solution, as Murugkar and other policy analysts propose, is one of price stabilization: for the government to buy and store onions in times of glut and then to release them in times of scarcity and to ensure more robust food aid programs. As neoliberalism has come under scrutiny, protesters have challenged their governments to assume a more involved role, including in ensuring affordable basic commodities. 

Lebanon: A Fiery WhatsApp Revolution

Lebanon may have entered into a new revolution, sparked over the rising costs of a messaging service. In what some news organizations have deemed the “WhatsApp Revolution,” Lebanon has emerged into a series of demonstrations that have cut across age-old sectarian lines, cities, and economic classes. Citizens stand united in their anger over their government’s failure to deal with an ailing economy, rising prices, high unemployment, poor public services, and corruption. The centrality of their concerns was a proposed tax that was never implemented.

On October 17th, 2019, the Lebanese government announced an intended $0.20 daily charge on voice calls made through WhatsApp, a popular messaging platform that citizens use for regular phone calls and texts. It was one of many austerity measures proposed to address the financial problems Lebanon had been experiencing. Citizen backlash forced the government to cancel the proposed tax within hours; however, the protests did not stop. The following day, tens of thousands of Lebanese of all sects took to the streets, demanding the resignation of President Hariri and his religious, sectarian government.

The WhatsApp tax served as a catalyst, unleashing pent-up anger that had been mounting for years prior. As one protester in the capital city of Beirut mentioned, “We are not here over WhatsApp, we are here over everything: over fuel, food, bread, over everything.” Another university student asserted, “This tax is only the last straw on the camel’s back — the real issue is the unaddressed economic problem.” Lebanon has been mired in its worst economic crisis since the 1975-90 Civil War. It has the third-highest public debt-to-GDP ratio in the world at 150%.  The youth unemployment rate has reached 37%, while the overall unemployment rate is 25%. And now, amidst the COVID-19 outbreak, half of the population lives under the poverty line. There are pervasive fears of commodity shortages and price rises, and citizens are angered by the government’s failure to provide basic services. Daily power cuts, a lack of safe drinking water, absent public healthcare, and intermittent internet connections have afflicted civilians. On top of all of this, the arrival of more than one million refugees from neighboring Syria has strained the country’s already-weakening infrastructure and public service provisions. Like in Chile, dissatisfaction had been staggeringly high even a year prior. Already in the fall 2018, roughly four-in-five Lebanese adults (77%) reported that they did not trust their government “to do what is right for the country.” However, it was the WhatsApp tax more than a year later that set loose the mounting anger. 

The WhatsApp tax, though, was not the sole trigger. Lama Mourad, a postdoctoral fellow at Perry World House, University of Pennsylvania, elucidates in an interview with the HPR that it is incorrect to “think about the tax in isolation… because there really is a more complex story.” In the days prior to the proposed tax, forest fires ravaged through Lebanon’s mountains. However, the emergency response was hampered by faulty equipment, as the government had not been paying for its maintenance. The fires revealed the shocking incompetence and mismanagement of the government. After failing to provide even the basic function of compensating citizens for their losses, “the first thing the government turns to is a tax… where the lower-classes… are hit the hardest.” It was this hypocritical imbalance between extraction and restitution by their government that was at the heart of the protesters’ concerns.

Yet, WhatsApp, in particular, is especially symbolic of the extraction of the state. On the same day as the WhatsApp tax, other regressive taxes, on tobacco and petrol, were also proposed; yet, it was the WhatsApp tax alone that was the target of anger. This is because WhatsApp serves as a microcosm, symbolically, for the larger grievances of the demonstrators. In a survey conducted in fall 2018, 84% of Lebanese adults use WhatsApp, the highest rate among the eleven emerging economies in the survey. Mobile-phone charges in Lebanon are among the most expensive in the region because of the embeddedness of telecom with the state. Dr. Mourad explains that “the telecom industry is considered to be one of the most corrupt industries in the country.” To save money, many Lebanese rely heavily on WhatsApp, where messaging costs are free. As a result, WhatsApp had appeared to be the only telecommunication service that had narrowly escaped from the state’s extractive hands. However, when their last resort for free communication was targeted as well, citizens finally felt cornered. As one protester said on a local TV channel, “WhatsApp is the only social media we have to vent our frustrations. Now, they want to tax our venting as well.” Now, their frustrations rang out throughout the streets. 

Particularly, the state appeared the most extractive of those who needed its services the most. As in Chile and India, the working-class would suffer the most from the proposed regressive tax due to their large dependency on the service, unable to afford normal telecom call prices. The result in Lebanon was, at first, a distinctly working-class protest. The protests were initially described as “the revolution of the motorcycles,” as individuals mounting motorcycles — a vehicle primarily used by the working-class in Lebanon — crowded the streets to demand change. Dr. Mourad notes that such a class difference and its reach throughout the entire country differentiated this protest “from previous mobilizations that were centered around the upper-middle class, Beirut elite.” Though, abruptly the rest of Lebanese society joined the demonstrations. The result was a “unified critique of the whole sectarian system combined with a strong criticism of the banking sector,” another of the most corrupt sectors in the country. The protests demonstrated the secular trend that “what happens at the top among elites, effectively does affect people’s day to day lives and livelihoods, their ability to work and to have a good life.” Like in Chile and India, such seemingly nominal goods were representative of the larger problems afflicting civilians’ livelihoods in a neoliberal economy: unresponsive governments, unaffordable costs of living, and economic distress.

The Future of Pocketbook Protests

The fires lit by these single sparks still continue to blaze. The frustrations felt among citizens from these neoliberal reforms have only been further exacerbated by an even more pronounced trigger: the recent COVID-19 outbreak. The initial causes for mass mobilization may soon become immersed within more pressing economic and medical needs. However, the Metro System in Chile, onions in India, and WhatsApp in Lebanon still remain significant in that they reveal a basic arc of protest movements. They also expose a more systemic grievance: that the situation of working-class individuals globally has deteriorated with the rise of a largely deregulated and precarious working environment. Protests have been employed widely in the past year to express this very concern, in locations stemming from France to Iran. However, in order to prevent this wave of recent protests from becoming a lasting occurrence, they must be met with equal consideration from those in power with whom their concerns are directed.  

 

Image Credit: Flickr // John Englart

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