French riots in a wider perspective
John Robb of global guerilla's framed ongoing riots in France as a struggle between participants of the formal versus the informal economy, triggered by a crackdown on the informal economy launched by the French interior minister. This frame of reference resonates with my own experiences when I visited Rouen last year; most economic opportunities in the suburbs are outside the formal economy. I did not encounter a single business hiring employees (I saw plenty in Brugge a day earlier). This is not a war between faiths or convictions, but between economies. And I do not think it is unique to France; it has a lot of different incarnations, for example we saw a glimpse in The Netherlands last year. Whenever the formal economy excludes a population segment to the point where most economic opportunities are outside the legal realm, the seeds are sown and a crackdown on the illegal economy can spark just this kind of disorder. This whole affair reminds me of the analisys of Hernando de Soto on informal economies.
Thinking within this frame of reference, it seems obvious the way to de-escalation would be to involve the rioters in France's formal economy. The trouble is that such involvement takes time to establish, time the French appear to lack at the moment.
While the current French strategy of trying to raise the transaction costs in the informal economy is probably part of the solution it cannot solve this conflict by itself. Among other things, the price of detaining thousands of rioters is simply to high. Lessons can be learned here from the American and Afghan "war on drugs". Despite detaining thousands of people the US hasn't even made a dent in the drugs economy. The suppliers of the stuff simply have to big an economic incentive, in a large part because they lack other economic opportunities. Most poppy and coca farmers would rather have legitimate produce, if only it could support their families.
An offensive approach must be accompanied by a (long overdue) push to crack down on discrimination and include potential rioters (or drug dealers, etc.) in the formal economy by opening up economic opportunities. Such an approach could be inspired by successful development strategies in the third world, since it must deal with a lot of the same problems. And owing to the limited timeframe, a distributed, inclusive, "open source" strategy seems the only way to acquire the leverage needed to counter the positive feedback loop the rioters are trying to establish. If successful in disrupting the French economy the rioters are feeding their own recruiting grounds of unemployed youth. The challenge for the French government is to have jobs waiting in the morning for their disenfranchised youth, to prevent them rioting at night.
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