Bright eyed executives are nowadays told to be disruptive. The new term replaces 'out-of-the-box thinking' that has, as with most buzzwords fast become a cliché. The newness comes in the form of, to use another cliché, 'shaking the tree' of conformity. Sometimes it works; sometimes it doesn't. That's when they are quietly and conveniently binned in the box of 'calculated risks'. Thinking back to the storming of the Bastille or the Oliver Cromwell days there's resonance to be found in social disruption. The base from which the Rothschild dynasty emerged was from a disruption called 'speculation'. It served well and continues to date having spanned two World Wars and more limited conflicts. The danger of it going wrong was exemplified when it spurred the crunching economic meltdown eighteen years ago.
Something has to give in the morass that we find ourselves in today. Following lukewarm attempts by weekend protests in France a few years back there is an apprehension of matters more serious and deep in the making. Mid-last century Kolkata commuters went on riot after tram fares were increased. Such protests haven't proved as successful in recent times as law enforcers no longer act as spectators. That's why new disruption concepts emerging from the United Kingdom and Australia are refreshing.
The British are organising themselves to stop paying the grossly inflated energy bills simply because they can't afford them. The argument quite clearly is that it is the government's duty to lessen the impact. Wisely, the Tory government hasn't reacted. Instead the complex cartels of debt managers are as quietly trying to dissuade such ventures. With recession looming and fears of rise in electricity prices and load shedding in the winter months, prospects look bleak. Such thoughts have forced Rishi Sunak and Liz Truss to change their pitches in quest of the Tory leadership and arguably Prime Ministerial aspirations. From the business end, Australians are suggesting disruption of their own. Associations will be gathering to formulate a slew of alternative measures that include special tax on windfall profits made by businesses in the midst of unlicensed strife. Civil disobedience in a democracy can't be encouraged. What can happen is for better alternatives informed by new thinking of economists.
President Jo Biden is a relieved man. Prices at the pump have reverted close to that of two years ago. July inflation was at par with June. He has now called for a new infrastructure for the world economy, echoing that which a few economists have been clamouring for. Even open market economic traits can and should change. Price hikes that ease in gently and are in proportion to the triggers are better adapted to by consumers. Unstructured economies' trend of increases much higher than required are grotesque. That's the word UN Secretary General Antonio Guetteres chose to describe the $100 billion profits raked in by energy companies in the first half of the year. He too has called for taxes on such windfalls to be redistributed among the populace. While that may work when the private sector is involved it doesn't where governments run the energy business. For any leeway, one way out is for subsidies, a tactic frowned upon by the International Monetary Fund (IMF).
Another favourable option is getting new generation thoughts in to figure out how to drive efficiencies through reducing costs. The concept isn't new having been practiced by the private sector for decades. Governments, such as Bangladesh are working on re-prioritisation of projects. Divided into three layers, there is a spending cap on the first two and a temporary freeze on fund allocation for the third. Micromanagement shouldn't take up policy maker time but in stress situations such is called for. Pre-emptive measures such as load shedding and fuel use curbs in the public sector may hurt but are inevitable. Discouraging non-essential imports by requiring 100% cash margins upfront is beginning to slow outflow of currency reserves.
Consumers are fatigued by the increasing demands on dwindling incomes by inexplicable price movements of essential items and transportation. Reduced consumption doesn't help the economy but in absence of viable options that is the first thought on consumer minds. Recession is as bad as inflation. Drastic disruption is the order of the day.
