A Protest That Encourages the First Mover

Most protests against the government are costly and dangerous things. Protesting involves leaving work in the middle of the day (a population with a low employment to population jobs makes protests more likely for numerous reasons) to go to a city center and face off against police who are armed and have the existing regime backing them up. It's particularly dangerous to be among the first protestors entering this situation, because the police are much more likely to arrest a small group of initial protestors whereas it is logistically difficult to do the same thing to a large mob.

Given these constraints, it's a wonder that significant protests against the powers that be get started at all.  A small group with a special combination of courage and foolhardiness, combined with a focal point that will assure marginal potential protestors that they won't be the only ones, is generally needed to get the ball rolling.

Recently, large amounts of protestors have taken to the streets in Kiev, where the Ukrainian people are upset that their President Viktor Yanukovych is so far in the pocket of Putin that he blocked an EU free trade deal favored by many. (It might be that Yanukovych gave in to Russian pressure because he worried a recession induced by Russian sanctions would lose him the election in 2015, but the result is the same.) In this case the focal point wasn't just Yanukovych's rejection of an EU trade deal, but the brutal way the police broke up the initial protest composed of those first movers.

What's interesting is that there is an idea is floating around for an additional method of protest that encourages Ukrainians to join the protest and join noe. The strategy is simple: Encourage people to move their money out of the overvalued and pegged Ukrainian hryvnia into other currencies. Even better is taking the money out the banking system entirely.  If enough people do either of these actions, the Ukrainian Central Bank will struggle to hold up the banking system. Even if they only change currencies, Ukraine will be forced to weaken their currency as their reserves are low and they are running a current account deficit. This is a really interesting strategy for the following reasons:

1. Symbolically, it has citizens protesting an economic injustice with micro-economic sanctions of their own.

2. Unlike most forms of economic protest, it imparts potential benefits to participants outside of just increasing the chance that their demands will be met. Protests are usually relatively dangerous, but in this case it might be the only way to be safe.

3. It encourages the first movers, as the sooner the currency is converted to a more stable currency the less they risk from devaluation. And if enough people withdraw their deposits then a bank holiday might be declared in which those slow to join in will lose access to their money.

4. If it causes a devaluation then Yanukovych is more likely to lose the next election. 

The potential for turmoil already has Ukraine's Central Bank Governor scrambling, he released a message to the public telling them not to withdraw deposits and vowing that he would do everything needed to ensure stability.

Like all protests, the government has numerous ways of fighting back against this type of move. Figureheads with too much to lose should still be reluctant to join in. And additional capital controls can be imposed once the problem becomes obvious. But the overall lesson of finding ways to make it not just morally right, but safe and prudent for people to join a protest is an idea that more first mover protestors should think through.

It will be interesting to see how the situation in Ukraine develops.