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Rise Of A "Divergent" Middle Class As The Agent Of Change In Latin America

Buenos Aires' Florida Street
Buenos Aires' Florida Street
Rolando Arellano*

- Op-Ed -

SANTIAGO — Recent findings from the World Bank and the Banco Interamericano de Desarrollo (BID) confirm that the middle class is now the majority in South America — and it will continue to grow.

Without wading into the quagmire of defining “middle class,” a dicey topic with many nuances and interpretations, it bears mentioning that middle classes are not all the same across the region. And it is important for businesses in particular to adequately understand this if they want to reach their development potential.

There are at least three Latin American “middle classes” that we will call the traditional rising middle class, the traditional declining middle class, and the diverging middle class. The first two correspond to people who have arrived into the traditional middle class, either by ascension from the lower classes or by falling from wealthier ones. The third is a new form of middle class that doesn’t follow the standards commonly identified with this demographic.

The traditional rising middle class reflects conventional patterns of increasing economic and social status. It is growing more quickly in countries that have enjoyed sustained growth in recent years, following the traditional patterns of modern development (greater industrialization, a move into globalization, respect for property rights, etc.). Chile is the exemplary case of this trend, with Mexico and Brazil exhibiting some but not all the characteristics.

This type of middle class started to increase in size between the 1960s and 1980s, and then adapted to new international conditions of economic exchange (free trade, exports, arrival of multinationals). It is, therefore, an urban, Westernized middle class, which has roots in traditional suburbs. It is a fervent guardian of the status quo, protector of property rights, and typically upholds conservative political and social ideas.

This middle class was always linked to, or in some way indirectly dependent upon, the upper classes, to which it naturally aspires. At the same time, it feels that its power and social status are threatened by new and unfamiliar migrating classes who arrive in cities, and who could eventually end up achieving economic status superior to its own. This first kind of middle class doesn’t consist of great entrepreneurs, and in terms of business in general may not be the most profitable, but rather consists of a very industrious workforce that aims to maintain a salary and raise a family with a few well-educated children.

Losing status

The declining traditional middle class is of particular interest to researchers lately in Latin America, and corresponds to those groups that formed in some countries especially around the 1950s, and now are losing strength. Examples are the middle classes coming from countries such as Argentina and Uruguay, and also Venezuela, which in recent times have been losing economic power and haven’t been able to overcome the infamous “lost decade” of Latin America.

This class is composed mainly of employees, urban dwellers and those who live in traditional suburbs close to the upper class, to which they would have wanted to remain a part of (although today many feel betrayed by them). It is a middle class which, earlier, suitably took on the pivotal role between large industrial owners and the working class.

As they lose economic capacity and power, this portion of the middle class fears approaching the lower classes, with whom they've never identified in the past. So by contrast to their “rising” cousins, they are more prone to identify with populist political ideas or the traditional left wing. Many have been forced to migrate from small to large cities, or to another country entirely, as they feel they are losing the status which they had held for some time.

As one commentator points out in Argentina, for example, “To stop being middle class virtually means to cease to be at all.”

A new model

The new diverging middle class is the new type of middle class that we would like to present. It is born of the large wave of migration from the countryside to cities that many Latin American countries experienced between 1960 and 2000. Its magnitude was so huge that this group now represents almost two-thirds of the population of Sao Paulo, Mexico City, Lima and other large Latin American cities.

To begin with, the members of this demographic trend were originally rejected by governments and traditional upper and middle classes. So they built their own homes and businesses, managing to create a parallel economy with its own dynamics. By now, this vast, diverging middle class has risen out of poverty, according to economic data.

But what is most interesting about these groups is that they have never been dependent on the traditional upper classes, nor do they follow their behavior as an example. In this way they created their own models of social coexistence (based on utilitarianism and practicality), their relations with the authorities (broadly liberal, a level approaching anarchism), their own codes of beauty (special architecture in their homes and businesses, the mixing and clashing of colors), and much more.

They are mostly entrepreneurs, hard workers, and to the extent that they own their own homes and businesses, be they large or small, are all strong advocates of property rights. Judging by their origins, one might assume that they are very traditional, but this is not the case. They are open to change and often import trends from elsewhere (via Internet or television) and adopt these without them passing through the “aspiring” filter of the upper classes. Evidence can be found in the music that their children listen to (a form of American-style rap and reggae, but “tropicalized” in South American countries) and the idols they follow, such as some Korean pop groups.

This is the new middle class that, contrary to expectation, isn’t the guardian of traditional society, but rather is the most important agent of change in the future.

*Rolando Arellano is president of Arellano Consultants for Emerging Economies.

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Geopolitics

How Thailand's Lèse-Majesté Law Is Used To Stifle All Protest

Once meant to protect the royal family, the century-old law has become a tool for the military-led government in Bangkok to stamp out all dissent. A new report outlines the abuses.

Pro-Democracy protest at The Criminal Court in Bangkok, Thailand

"We need to reform the institution of the monarchy in Thailand. It is the root of the problem." Those words, from Thai student activist Juthatip Sirikan, are a clear expression of the growing youth-led movement that is challenging the legitimacy of the government and demanding deep political changes in the Southeast Asian nation. Yet those very same words could also send Sirikan to jail.

Thailand's Criminal Code 'Lèse-Majesté' Article 112 imposes jail terms for defaming, insulting, or threatening the monarchy, with sentences of three to 15 years. This law has been present in Thai politics since 1908, though applied sparingly, only when direct verbal or written attacks against members of the royal family.


But after the May 2014 military coup d'état, Thailand experienced the first wave of lèse-majesté arrests, prosecutions, and detentions of at least 127 individuals arrested in a much wider interpretation of the law.

The recent report 'Second Wave: The Return of Lèse-Majesté in Thailand', documents how the Thai government has "used and abused Article 112 of the Criminal Code to target pro-democracy activists and protesters in relation to their online political expression and participation in peaceful pro-democracy demonstrations."

Criticism of any 'royal project'

The investigation shows 124 individuals, including at least eight minors, have been charged with lèse-majesté between November 2020 and August 2021. Nineteen of them served jail time. The new wave of charges is cited as a response to the rising pro-democracy protests across Thailand over the past year.

Juthatip Sirikan explains that the law is now being applied in such a broad way that people are not allowed to question government budgets and expenditure if they have any relationship with the royal family, which stifles criticism of the most basic government decision-making since there are an estimated 5,000 ongoing "royal" projects. "Article 112 of lèse-majesté could be the key (factor) in Thailand's political problems" the young activist argues.

In 2020 the Move Forward opposition party questioned royal spending paid by government departments, including nearly 3 billion baht (89,874,174 USD) from the Defense Ministry and Thai police for royal security, and 7 billion baht budgeted for royal development projects, as well as 38 planes and helicopters for the monarchy. Previously, on June 16, 2018, it was revealed that Thailand's Crown Property Bureau transferred its entire portfolio to the new King Maha Vajiralongkorn.

photo of graffiti of 112 crossed out on sidewalk

Protestors In Bangkok Call For Political Prisoner Release

Peerapon Boonyakiat/SOPA Images via ZUMA Wire

Freedom of speech at stake

"Article 112 shuts down all freedom of speech in this country", says Sirikan. "Even the political parties fear to touch the subject, so it blocks most things. This country cannot move anywhere if we still have this law."

The student activist herself was charged with lèse-majesté in September 2020, after simply citing a list of public documents that refer to royal family expenditure. Sirikan comes from a family that has faced the consequences of decades of political repression. Her grandfather, Tiang Sirikhan was a journalist and politician who openly protested against Thailand's involvement in World War II. He was accused of being a Communist and abducted in 1952. According to Sirikhan's family, he was killed by the state.

The new report was conducted by The International Federation for Human Rights (FIDH), Thai Lawyer for Human Rights (TLHR), and Internet Law Reform Dialogue (iLaw). It accuses Thai authorities of an increasingly broad interpretation of Article 112, to the point of "absurdity," including charges against people for criticizing the government's COVID-19 vaccine management, wearing crop tops, insulting the previous monarch, or quoting a United Nations statement about Article 112.

Activist in front of democracy monument in Thailand.

Shift to social media

While in the past the Article was only used against people who spoke about the royals, it's now being used as an alibi for more general political repression — which has also spurred more open campaigning to abolish it. Sirikan recounts recent cases of police charging people for spreading paint near the picture of the king during a protest, or even just for having a picture of the king as phone wallpaper.

The more than a century-old law is now largely playing out online, where much of today's protest takes place in Thailand. Sirikan says people are willing to go further on social media to expose information such as how the king intervenes in politics and the monarchy's accumulation of wealth, information the mainstream media rarely reports on them.

Not surprisingly, however, social media is heavily monitored and the military is involved in Intelligence operations and cyber attacks against human rights defenders and critics of any kind. In October 2020, Twitter took down 926 accounts, linked to the army and the government, which promoted themselves and attacked political opposition, and this June, Google removed two Maps with pictures, names, and addresses, of more than 400 people who were accused of insulting the Thai monarchy. "They are trying to control the internet as well," Sirikan says. "They are trying to censor every content that they find a threat".

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