Survey Shows A Majority Of European Youth Would Participate In Uprising To Overthrow Status Quo

Tyler Durden's picture

Authored by Mike Krieger via Liberty Blitzkrieg blog,

As the title of today’s piece implies, something very rotten is happening across the Western world and it’s starting to push many people, especially the youth, toward a breaking point. In the U.S., much of the problem relates to increased corporate power and monopoly, which has resulted in a less dynamic economy characterized by a neo-feudal plantation model where a small group of people continue to rent-seek profits at the expense of society at large.

Surprisingly enough, today’s piece will zero in on the observations of fund manager Jeremy Grantham to make the point. In his quest to understand why P/E multiples and corporate profit margins have failed to revert to the prior mean over the past couple of decades, Mr. Grantham of GMO made some very important points about how the American economy has changed for the worse during the 21st century. Indeed, much of what he observes can be seen as key factors in rising income equality, which in turn leads to social instability.

Here are some of his key points from the latest GMO Quarterly Letter (it starts on page 9):

How about profit margins, the other input into the market level? Compared to the pre-1997 era, the margins have risen by about 30%. This is a large and sustained change.


Of all these many differences, the most important for understanding the stock market is, in my opinion, the much higher level of corporate profits. With higher margins, of course the market is going to sell at higher prices. So how permanent are these higher margins? I used to call pro t margins the most dependably mean-reverting series in nance. And they were through 1997. So why did they stop mean reverting around the old trend? Or alternatively, why did they appear to jump to a much higher trend level of pro ts? It is unreasonable to expect to return to the old price trends – however measured – as long as pro ts stay at these higher levels.


So, what will it take to get corporate margins down in the US? Not to a temporary low, but to a level where they uctuate, more or less permanently, around the earlier, lower average? Here are some of the influences on margins (in thinking about them, consider not only the possibilities for change back to the old conditions, but also the likely speed of such change):


– Increased globalization has no doubt increased the value of brands, and the US has much more than its fair share of both the old established brands of the Coca-Cola and J&J variety and the new ones like Apple, Amazon, and Facebook. Even much more modest domestic brands – wakeboard distributors would be a suitable example – have allowed for returns on required capital to handsomely improve by moving the capital- intensive production to China and retaining only the brand management in the US. Impeding global trade today would decrease the advantages that have accrued to US corporations, but we can readily agree that any setback would be slow and reluctant, capitalism being what it is, compared to the steady gains of the last 20 years (particularly noticeable after China joined the WTO).


Steadily increasing corporate power over the last 40 years has been, I think it’s fair to say, the defining feature of the US government and politics in general. This has probably been a slight but growing negative for GDP growth and job creation, but has been good for corporate profit margins. And not evenly so, but skewed toward the larger and more politically savvy corporations. So that as new regulations proliferated,they tended to protect the large, established companies and hinder new entrants. Exhibit 5 shows the steady drop of net new entrants into the US business world – they have plummeted since 1970! Increased regulations cost all corporations money, but the very large can better a afford to deal with them. Thus regulations, however necessary to the well-being of ordinary people, are in aggregate anti-competitive. They form a protective moat for large, established firms. This produces the irony that the current ripping out of regulations willy-nilly will of course reduce short-term corporate costs and increase profits in the near future (other things being equal), but for the longer run, the corporate establishment’s enthusiasm for less regulation is misguided: Stripping out regulations is working to fill in its protective moat.


Corporate power, however, really hinges on other things, especially the ease with which money can influence policy. In this, management was blessed by the Supreme Court, whose majority in the Citizens United decision put the seal of approval on corporate privilege and power over ordinary people. Maybe corporate power will weaken one day if it stimulates a broad pushback from the general public as Schumpeter predicted.  But will it be quick enough to drag corporate margins back toward normal in the next 10 or 15 years? I suggest you don’t hold your breath.


– It is hard to know if the lack of action from the Justice Department is related to the increased political power of corporations, but its increased inertia is clearly evident. There seems to be no reason to expect this to change in a hurry.


– Previously, margins in what appeared to be very healthy economies were competed down to a remarkably stable return – economists used to be amazed by this stability – driven by waves of capital spending just as industry peak profits appeared. But now in a very different world to that described in Part 1,4 there is plenty of excess capacity and a reduced emphasis on growth relative to profitability. Consequently, there has been a slight decline in capital spending as a percentage of GDP. No speedy joy to be expected here.


The general pattern described so far is entirely compatible with increased monopoly power for US corporations. Put this way, if they had materially more monopoly power, we would expect to see exactly what we do see: higher profit margins; increased reluctance to expand capacity; slight reductions in GDP growth and productivity; pressure on wages, unions, and labor negotiations; and fewer new entrants into the corporate world and a declining number of increasingly large corporations. And because these factors a ect the US more than other developed countries, US margins should be higher than theirs. It is a global system and we out-brand them for one thing.


– The single largest input to higher margins, though, is likely to be the existence of much lower real interest rates since 1997 combined with higher leverage. Pre-1997 real rates averaged 200 bps higher than now and leverage was 25% lower. At the old average rate and leverage, profit margins on the S&P 500 would drop back 80% of the way to their previous much lower pre-1997 average, leaving them a mere 6% higher. (Turning up the rate dial just another 0.5% with a further modest reduction in leverage would push them to complete the round trip back to the old normal.)

What I found most interesting about the above observations is that they weren’t the ramblings of a political stooge trying to get elected for something, but rather the sincere conclusions of an investment manager trying to figure out why profit margins aren’t reverting to the mean. In doing so, he provided us with some very valuable nuggets about the underlying sickness of the U.S. economy, and why elevated corporate profits is a sign of economic weakness, not strength.

I actually wrote about this exact topic all the way back in 2012 in the piece, The Stock Market: Food Stamps for the 1%. Here’s some of what I observed at the time:

More than any other group, the 1% has been convinced that the stock market represents some sort of leading indicator of wealth and prosperity.  Nothing could be further from the truth.  Sure, the stock market can function as such an indicator.  It is such an indicator when the rising stock market reflects a dynamic, capitalist economy where new industries and companies are rising to the top and improving standards of living for the populace.  It represents the opposite indicator when it merely reflects the ownership interests of the oligarchs in a crony-capitalist, fascist economy that is picking away at the dying carcass of what little economic freedom still remains.  This is what a rising stock market actually represents today.  When people look at it they should understand it is merely a measure of the oligarchs getting wealthier and more powerful and you becoming more of a debt slave.  It represents their interests in multinational corporations with record profit margins because they refuse to pay their employees a living wage. 


A rising stock market today is actually a leading indicator of the destruction of the middle class, cultural destitution and a society in collapse.


The stock market is like slop in a pigpen.  It is a key instrument used to keep the 1% from getting antsy.  Unlike the middle class (a group that isn’t falling for any of the tricks), many of the 1% work on Wall Street or related industries and own stocks.  Many of the people in the 1% are at least wealthy and connected enough to still cause serious problems for the oligarchs.  They must be kept quiet as the coup that started in 2008 is brought to fruition.  Then they will be left high and dry like everyone else.  This is the role that the stock market is playing at the moment.


So as the 1% sits around analyzing a casino, the poor collect food stamps and the middle class dies.  Many in the 1% look upon the poor on food stamps with disdain, yet little do they realize they are on food stamps as well.  It’s called the stock market.

Moving back to Grantham, he goes on to write the following:

Income inequality that may be helping to keep growth and rates lower will, unfortunately, in my opinion, also take decades to move materially unless we have a very unexpected near revolution in politics.

Here’s where I disagree with his forecast. The revolution in politics he accurately thinks it will take to change things is very much here, and will become far more noticeable in the years to come. I think Grantham is looking at Trump “populism” and concluding that his policies are largely very corporate profit margin friendly. I agree with this assessment, which is why I see Trump as a fake populist. That said, there’s another ascendant populist movement happening on the other side of the ideological spectrum, and I expect it to take hold as the preeminent U.S. political force going forward.

The likely catalyst for this alternative populist vision to take hold will be a failure of Trumpisms to help average Americans improve their everyday lives. Although progressive populism is still somewhat nascent, it is quite popular amongst the youth, and will likely become increasingly so as issues of student debt and healthcare costs begin to dominate the conversation far more than they do today. The Bernie Sanders movement was merely a tremor in a much larger earthquake likely to sweep across the land in the years ahead.

This sort of movement is precisely the sort which will cause the type of “revolution in politics” Mr. Grantham considers unexpected. Not only do I expect it, I think it might be much closer to affecting policy than he thinks (I think 2020-2030 could be dominated by this sort of politics).

Moving along to the title of this post, disillusionment and despair are even father along the spectrum in parts of Europe than in the U.S., which can be evidenced by the following excerpts from Quartz:

Around 580,000 respondents in 35 countries were asked the question: Would you actively participate in large-scale uprising against the generation in power if it happened in the next days or months? More than half of 18- to 34-year-olds said yes.


The question was part of a European Union-sponsored survey, titled “Generation What?” The report went on to focus on respondents from 13 countries to better understand what young people are optimistic and frustrated about in Europe. Among these spotlighted countries, young people in Greece were particularly interested in joining a large-scale uprising against their government, with 67% answering yes to the question. Respondents in Greece were also more likely to believe politicians were corrupt and to have negative perceptions of the country’s financial sector.



While some observers are hoping that the defeat of Geert Wilders in the Netherlands and the expected loss of Le Pen in France will herald the beginning of the end for populist momentum in the Western world, I have bad news for you. Not only will populism stay ascendant, we are merely in the very early stages of this ongoing political earthquake. I do not expect this trend to go away until the economic future for average citizens (especially the youth) starts to improve materially.

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nmewn's picture

Only an old, white, overweight, life long politician like Burnie Marx can save you now kiddies. Or maybe, a young, white, crony-socialist Rothschild-type like Macron ;-)

AVmaster's picture

This is obviously a left zinger written piece of poo...


There will always be the haves and have nots... 

There will always be the 1%...


This held true even in the leftards home base/dream utopia: The USSR...



nmewn's picture

Yeah, its the same old paradigm with variations on the theme..."What can the government do for me?!"...or alternately, when the subject of taxation comes up..."What can the government afford to let you keep?"

They just don't phrase it that way ;-)

rmopf2010's picture

The Status-quo is maintained through the votes of the big governments jobs votes/welfare state dependent votes

Socialism was so widespread that in almost all western countries they outnumber private workers, so they vote their government income. (Ex: even if in one couple the husbnad is working for the government who do you she'll vote ? socialism of course. At least there's one safe job in the house)

Doomed are the private workers!


new game's picture

I wonder if this "youth" has any skin in the game? lol...

BobEore's picture


Nor is any needed anymore - to be a blustering pundit, a polarizing politician, or a "populist" paradigm. It's a joke, to think that kids who have grown up in the 'internet of things' world we live in could even for a moment do without - anything - long enough to focus on forcing a change for the better in anything.hat

They will however, willingly indulge in staging 'protest' at anything they are directed to - by dint of the skilled manipulators who control their hardwares ///and quite often now instigate 'challenges to the system' - in order to reinvigorate it!

"Trying to confront and destroy the system thus inadvertently revives it, giving it back a little bit of symbolic power"

"The system keeps itself alive by staging the ‘ruse’ of its death, while leaving the subjects it has created intact." Baudrillard.

Scrubs on skates... dupes on a death march.... call it what you will - it's all theatre which contains revolt rather than realizes the conditions necessary for it.

Populism is the illusion of power redirected into the hands of slaves whose ropes are on so tight as to prevent them from even moving in the direction of seeing those who dangle such promises over them... to realize that what is dangled be more strings, not the keys to their bindings.

Nemontel's picture

There is no mass populist movement in Japan or South Korea. For obvious reasons.

BobEore's picture

I'm open to the idea that ethnic cohesion breeds social harmony.

I'm also open to the notion that the stratifications within a given society which reflect diversity of ethnic background are as likely to produce a superior 'melange' of social interactions and overall improvement in its' collective achievements... as it is to produce a lower. 

Specific circumstance dictates that outcome, as much or more than simply genes. A 'mestizo race' - such as that of Mexico for example - can be a blending heavy on the side of the worst characteristics of it's founding members... in this case - "Spanish" conquistadors, putatively of 'pure' Iberian descent, but more realistically, the scions of members of the Marrano class of forced Jewish converts to Christianity who hid their roots - and real loyalties - till becoming the landed gentry of New Spain.

Their heavy-handed enslavement and demeaning treatment of the native culture there resulted in a legacy of ill-will and 'hijos de la gran putana' - children of the great whore so to speak, the spawn of raped women. Not a great way to build a culture or a race. And it reflects in the people which you find there today.

Russia, on the other hand, reflects the opposite distillation process. A great culture possessed of great artists and cultural advance - at least till the equivalent of the sephardic rape n pillages in New Spain - the atheist judaics of the ashkenazi diaspora - were inserted into that place by their banking buddies of Wall Street - to 'raise' Cain so to speak - with the population. Fore that time, the greater part of the nobility had roots in the great Kipchak federation of steppe peoples from the Altaic part of Asia, along with German, Scots, Italian and Swede(Viking of course)bloodlines. A combination which over time produced some of the best music, poetry, prose, and scientific work common to humanity.

No line in the sand - regarding coloration, religion, or cultural merits intrinsic to a situation. A mysterious process at work over time creates both good and bad results... as well as middling. Being true to our roots involves a lot different meaning than simpletons with a melatonin complex seem to realize. Freedom luvin folk exist on all sides of the 'color' scale. We needs find and ally with them in protection against those who wish us all ill.  Always - seek the main and common enemy to social harmony from among their ranks! The ethno-religious supremists of talmudic terror.


French Bloke's picture

When the elite have everything and are scared of losing it, they go to war

When the have nots have nothing to lose, they go to war

The trick is to get them to war against each other, not to divert attention, as the elite are trying to do, against some fabricated dictator on Mars!

It's started happening in Paris and elsewhere. The avalanche pont may not have been reached yet but it wouldn't take much

Same old equation - "Greed" inversely proportional to "poverty caused" is an age old recipe for disaster. Yes, there will always be the 1% but if they owned say 15% of the wealth instead of well over 50% (probably much higher), then people would be more content. I'm not a socialist and would not consider any move towards subsidies (ie. welfare) as a solution. But taking away the rules that allow the elites their advantage, a more libertarian approach, would certainly go a long way. Sadly, Trump isn't the man to do it, as we now know...

Mtnrunnr's picture

Of coruse they have skin in the game. They are alive. They live in the neo-totalitarian regime of the EU with youth unemployment at Great Depression era levels above %20 and income inequality above great depression era levels. No one is arguing that capitalism and 1% is bad. BUT allowing capital to pool at the top and not be productive by building public works to placate the masses is a violation of the social contract. They get to live 1% lives and enjoy they modern advances and we get to raise a family. Not today. There is nothing.

TeraByte's picture

You have a point. Today´s revolution is cancelled, because of rain.


nmewn's picture

I just find it incredible how a socialist can talk out of both sides of their mouth without the slightest regard for what they are saying and think they are being intelligent or rational...

For example..."No borders!"..."No person is illegal!"..."We will fight for sanctuary cities & states!"

...cities and states have borders!

rmopf2010's picture



Don't you have noticed socialism is chaos, they one thing and it's opposite. Socialism is Evil.

When we though comunism felt with Berlin wall, Big mistake we have comunism 2.0 => Rome 2.0

Bread for welfare/big government and Games.

Under ex-comunists countries people knew who were the 1%, now that 1% is wide spread to include welfare/big government votes.

There is no black/white no left/right or other dividision upon us, the only true division is:

1) Who feed the states

2) Who receive from the state


Beaware how they sustain themselves in power it's always the same strategie

1) Increase Public Servants salarie

2) Increase Retirees income

3) Increase Minimum wage for private workers (the most undereducated so they believe in the socialism miracle)

You can see in this video Venezuela Nicolas Maduro's speach from Euronews

But if you google this 98% of the articles only mention Minimum wage increase point 3) it is hard to find an article posting the increase in points 1) and 2)

Impressive even in the begining of the video news they only mention 60% minimum wage increase only earing Maduro's speach you can get to the part of doctors, professors, policeman, firefighters and retireds will have also a 60% income increase!

Fake MSM main deceiving agenda, hiding who is voting for the status-quo maitainance !!!!!!!!!!!!!!


That is why we have no hope at all! They've safeguarded themselves with buying votes programs.



Debugas's picture

q: "What can the government do for me?!".

a: Stop taxing me 

nmewn's picture

It is interesting (in an Alinsky propaganda-style sorta way) how they always frame the subject...

"Foundation X released a study yesterday that states a tax cut will cost the government 10 trillion dollars over ten years."

...see how they did that?

Its never that the government will ALLOW you & I to keep 10 trillion dollars of our money over ten years. Thats a "cost" to them you me they might as well say the Sheriff of Nottingham is a national hero of the UK and bestow sainthood on all IRS Commissioners upon leaving office ;-)

sagramore's picture

Just remind people that govern = control and ment = mind.

Mind control. You are literally paying others to control your mind. Stop being a chump.

Offthebeach's picture

Old regimes are impressed upon new generations that had no say, are too late to the party, and are made to be killed, taxed, or both.

There are no revolts by old people.   Not because they are old, but because they are benefactors of the old regime.  Young revolt because they, roughly, view the old regime of passing on debts for a systen they are stuck paying the debts of.

Like a young person on their old folks broken down swamp farm.  "Some day young'un this pig sty, shack, sick horse and crushing debts and back taxes will all be yours!  When you are 50.  And unmarried. And no wife or children"

So the kid revolts.  Bails. Runs off.  Or worse.







mike_king's picture

The author, Mike Krieger, shows us once again, that progressives are mentally ill, with no understanding of reality.

jamesmmu's picture
The Idea That ISIS Are Evil Masterminds Is Ridiculous – And It Distracts From Who The Real Enemy Is

Colonel's picture

WTF!!?? Greece should be 100%.

giovanni_f's picture

it is 100%. the other 33% work for the government.

(this is where democracy becomes really funny. you can elect your own benefits)

Ghordius's picture

instead, it's 67%, which is, interestingly, the same quota of Greeks that answer that they prefer to keep the EUR in their pockets instead of having their government - national government, note - to devalue it

and you see the Swiss youth in this poll answering at the tune of 44%

which might make you think back about polls and what the youth really thinks, when they say "I would participate to an uprising"

where Murdoch and co. have a strong influence, "populism" generated two phenomenons: Trump's victory and Brexit, paired with very strange poll results, imo mainly because of distrust towards the "lying msm" and pollsters asking questions

now, this year, we will have other elections, and we will see if that "populist wave" generates similar results in radically different media and electoral landscapes, or if that meme of "western world going this way" really holds

my prejudice is still there: Murdoch's bunch have influence in two key areas: "middle USA" and "middle England". the policies they favour are still the same as ever: super-FIRE economies, a warlike stance against several countries that favours MICs, the petro-dollar complex, and strong alliances with several countries in the ME coupled with strong enemities with other countries in the ME, but "don't mention that"

quadraspleen's picture

And they asked Wales and Ireland (which part?) but not rest of the UK..funny..I'd have thought they'd get a pretty lukewarm reception from our hackneyed fucked-up youth here in England. They can't be arsed to do anything bar order pizza or beer, let alone overthrow anything complicated like a government. They're happy to smash up their inner cities, though so there is hope yet..

Frederico's picture

"super-FIRE economies, a warlike stance against several countries that favours MICs, the petro-dollar complex, and strong alliances with several countries in the ME coupled with strong enemities with other countries in the ME, but "don't mention that"

You almost made it sound like the EU isn't doing exactly the same thing

Readership_of_the_Financial_Times's picture

There'll be an uprising when The Families say so, not now and not before then.


Pedronicus's picture

Strange graph. The Welsh vote was high, but England didn't make it on the chart! Were the English polled?

Ghordius's picture

I suspect they were, and that's the reason why they are not on the graph

English anger against government is nicely re-directed towards the EU

works like a charm, the only question is what happens when the UK is really out of the EU and they find out that their problems are still there

but I suspect their government will be able to milk the "foreigners are to blame" cow for a further spell after that

perkunas's picture


Yep they will be out, and "their problems", are the same. But its "their problems"now, and not some unelected bureaucrat in Brussels problem.

"foreigners are to blame" will never happen, the EU designed the massive immigration problem. They created the tensions, anything they do will be better.

DEMIZEN's picture

accross the globe not just in europe.

Sudden Debt's picture

If you want to know why the young would join a revolt, try to explain a minus 30 year old why a 40 year old mostly makes more money.

Last week a 29 year old guy was bragging to me how hard he worked... His wife constantly confirmed it... About an hour before I just left...

The nragging was that he worked so hard that usually he did 2 hour of overtime a day and that was the reason why he would become extremely successfull... And that where all the sacrifices he did... First of all, 2 hours is not a lot and it's the job you do that is important... He was a phone operator.... Yah... He was a friend of a friend so I was polite to listen to that kid but my god....

But on the other hand...

When a youngster sees he did 2 hours of overtime in the month, he mostly takes those as recup...

They would join a coup because they would believe they get more crap for free.  It wouldn't be about beliefs and without a belief they would never succeed. But populist could use them as canonfodder

sagramore's picture

"His wife constantly confirmed it... About an hour before I just left..."

What did his wife's son have to say on the matter?

Colonel's picture

" I do not expect this trend to go away until the economic future for average citizens (especially the youth) starts to improve materially."

In other words is it? " It's the economy stupid" said by Clinton back in the 90's or is it now, "It's immigration idiot!"

detached.amusement's picture

as it has been for a couple hundred years running,

its banksters

south40_dreams's picture

However, most preferred to play with their little telephones

DeaconPews's picture

All Socialist ideology run governments. Kind of ironic. They want to overthrow the very same ideology they pledge allegiance to.

hooligan2009's picture

i doubt the youth has pledged allegiance to socialism. it has no particular loyalty to what it knows has failed for decades - any loyalty is purely mercenary.

perhaps there will be a "nouvelle politik" to emerge from todays youth that says "don't steal my future by favoring special interest - whether they be welfare, military or corporate subsidies".

i live in hope.

JohnGaltUk's picture

The only voting the youth of today is XFactor

hooligan2009's picture

perversely, the rising stock market (aside from rigged by share buy backs that should be criminalized) is supported by savings into passive "balanced" funds in 401k plans.

these are attracting half a trillion a year in contributions, double that globally, and only ever buy - that is for the next 25 years anyway.

until companies seek to raise capital beyond IPO's, the economy is being starved of investment capital. i wish somebody could chart R&D expenditures against product launches and improvements - that might tell a positive story, or it might just show how stupid and incapable american companies are at innovating/improving products/services to improve living standards.

sure as hell there is no improvement in school meals, no matter how many robots or touch screens are installed in fast food chains.

Stinkytofu's picture


Around 580,000 respondents in 35 countries were asked the question: Would you actively participate in large-scale uprising against the generation in power if it happened in the next days or months? More than half of 18- to 34-year-olds said yes.

 a "survey" of millenial snowflakes results in a majority saying they'd get off their lazy asses and

do something.......but, well, they almost made another level of everquest, mom says the underoos

are still in the wash, and, like, it's really hot outside without AC, so you go ahead and start without

me, but i'll be there, i promises. for suresies!



yrad's picture

Everquest? Is this 2005 and nobody told meh?

ds's picture

The numbers support "it's the economy, stupid". Deluded to believe that there are real millenial paasions to take on the Matrix. A positive way to look at it is the global disintegration of many tribes and the emergence of new tribes linked to the technologies of the future eg Digitial Natives. Good news too that nations that we are used to become just habitats. 

grunk's picture

Of course Millenials will take on the Establishment.

First, though, they need to go to Starbucks, check e-mails on theirs I-phones, and update their Facebook status to "Revolutionary."

americanreality's picture

No, they're much smarter than your generation.  Your complacency is why we're all here,  sheep.

. . . _ _ _ . . .'s picture

Smarter? No. They do have the advantage of the internet, though.

barysenter's picture

Complacency? You're the one "waiting for the spark of opportunity". Are you aware Now?

Aristofani's picture

well it's slightly better than voting for tRump then sticking your head up his arse when he "has the power" , and all his does is blubber and bullshit away ad nauseum. Same as it ever was...same as it ever was....still waiting.....

StaySunny3000's picture

Upvoted for the Talking Heads reference.

. . . _ _ _ . . .'s picture

What then, are they waiting for?

atlasRocked's picture

increased corporate power and monopoly = fascism, an typical outgrowth of socialism and communism.