A Global Mood of Unease

With 2025 already halfway through, an atmosphere of economic jitters has enveloped most parts of the western world. Due to the increasing anxiety about inflation, unemployment, crime and immigration, the citizens across the G7 nations indicate an increase in their anxiety. Gold, the classic instrument to hedge against instability, has recently risen above the level of $3,500 an ounce, a record, and announces the extent of the worry with the situation in the minds of people and investors.

To some extent, this fear is beyond today figures. It is about the world that is economically uprooted, politically unstable and socially weak. This unease has no one specific cause but there are those dislocations that can be seen in the system. The re-emerging spacer of trade wars to the unprecedented consumer debt levels, the contemporary economy, particularly the one in the West, is being pushed to limits that it does not possess the same degree of control. And people, who are battered with the scars of pandemic and climate shocks are becoming increasingly nervous about the future.

Inflation Isn’t Going Anywhere Quietly

Yet, at the beginning of the 2020s, the central banks injected vast liquidity into the global economy due to the COVID-19 pandemic. This transgression monetary stimulus, combined with disrupted supply lines and the potentialities of geopolitics, initiated a flood of inflation that some were optimistically anticipating would abate in the year 2024. It didn’t, although inflation is dwindling in certain areas, the continuing pricing pressures, notably in food, housing, and energy, continue to be a pain to the backs of working and the middle-income households.

It is especially corrosive that the inflation that we see today is not the one that we are used to. Not boom time overheating, but more system wide limits, food shortages caused by climate change, disruption of supplies caused by war, and lack of affordable housing in big cities. Inflation is making it so that people are having to make tough choices and cutting into necessities and pushing back on life milestones to enter more debt balance in order to keep their feet off the ground.

Governments have been busy with policy tweaks although most of them only seem to be a knee-jerk reaction rather than strategic. The central banks are on a tight rope because any increase in interest rates will lead to a stalling of an economy in a recession, and with a delayed increase in the rates, the inflation will continue to escalate. People observe this tight rope, and they believe little that nobody has the situation under control.

The Shadow of Job Insecurity

Add to that inflationary suffering a lingering feeling of job insecurity and you have a combined syndrome that inflicts pain. Whilst rates of headline joblessness can be kept disarmingly low, there is another underlying way the nature of work is changing. The emergence of AI and automation, offshoring and employments based on contracts have made a lot of employees feel vulnerable.

Occupations involving white collars are no longer certain to a disruption any longer, and old routes paved to job security, education, experience and seniority does not appear to be a secure as it once was. The upward mobility dream is becoming diminished especially in the case of younger workers.  Real wages stagnated, housing is expensive and difficult to afford, and basic medical care or childcare is a strain in most G7 countries.

The unstable workforce and the so-called precariat, who have no security and little social welfare, are increasingly gaining popularity. The sound of economic scripts that said that the future meant flexibility and freedom are empty when in real life it is worry and burnout. This increasingly sharp divide between the classes who do and do not feel safe contributes to anger and partisan politics. Populist movements thus do not surprise anymore that they are gaining ground in the U.S. as well as in Europe. Grounds of extremism are ripe soil of economic pain.

Crime, Immigration, and the Politics of Fear

Superimposed on these tense economic issues are those more likely to appeal to emotional instinct crime and the problem of immigration. Perception tends to win over reality even when the crime figures remain stable or decreasing. During an economic recession period, any slight increase in theft, assault, or homelessness is multiplied. There are news cycles on sensational cases which promotes the idea of fear and continues to tell the story that the society is degenerating.

During the hard times, too, immigration becomes a scapegoat. The thing is that immigration can be typically economically desirable in the long term especially within aging societies. However, when the wages stop rising, and there is pressure on the provision of publicly funded services, it becomes simple to pit a target on newcomers as heavy or a danger. Arguments about immigration in such countries as Italy, Germany and the US, increasingly revolve around politics of identity rather than policy, which is defined by fear and belonging.

The fear is the common denominator about what ties these flashpoints, crime, job security, inflation, and immigration. The fear of deteriorating. The fear of opprobrium. The fear of a breaking social contract.

A Call for Bold, Honest Leadership

People do not want to hear hollow assurance, now they want good, progressive leadership. The leaders need to face the current economic weaknesses with sobriety and compassion. It involves making investments in housing and education, reconsidering the tax system so that work a day investment is encouraged, rather than speculation, and establishing a sturdy safety net that is in tune to the 21st century reality. It is also necessary to restore confidence in institutions, financial, governmental and media.

This cannot be done by promoting press releases and stimulus checks. It needs to connect to the authentic needs of the population and be held responsible on the top levels and a vision on the workability of the economy to benefit all people and not just the top 10% of the population.

As a country, the economic peril in the future is no longer collapse, but chronic erosion. Slow churning feelings that the dream of riches is evaporating. That wear and tear does not always feature on newspapers, but the mark is serious. In case it is not addressed, it will cause the next step of crisis social, political, or economic.