By John Richardson
MOST of the experts believed that Remain was going to win the vote on whether or not Britain would stay in the EU. Such was the strength of the consensus that even Nigel Farage, then leader of UKIP, seemed ready to concede defeat on the night of the vote.
And well into the night that votes were being counted in the US presidential election, most pundits still thought Mr Trump only had a slim chance of taking the White House.
You must not, as a result, react with the word “impossible” to any of these six suggestions about what could happen in 2017.
- Populists win elections in Italy, Holland and France, and make big gains in the elections in Germany.
- One or more of these poll results causes a collapse of the Euro as the EU as a whole begins to unravel.
- Geopolitical tensions between Europe and Russia over Ukraine and the status of the Baltics States escalate.
- Much-higher global interest rates and a stronger dollar lead to an emerging markets debt and currency crisis, at least as bad as the 1997-1998 Asian Financial Crisis.
- The stronger dollar widens the US trade deficit to the point where the Trump government is forced to respond in a bid to deliver on its election-campaign promise of new jobs. This involves declaring China a currency manipulator and levying heavy tariffs on Chinese imports. We thus end up in a global trade war.
- China is dragged into a major financial sector crisis as a result of both the scale of its debts and these global headwinds.
Not all of these events have to of course happen to make 2017 a pivotal year. Only one needs to happen. There are also many other possibilities not listed here. For instance, I haven’t discussed the Middle East and the risks of US-China geopolitical disputes. And there are sure to be new events that emerge during the course of the year that threaten global economic and geopolitical stability.
Why are we in this mess? Because the failure to accurately read the popular mood ahead of Brexit and the US election is an indication of a much deeper and wider failure. Many of the mainstream “experts” have failed to understand the demographic changes behind the anger and frustration of hundreds of millions of middle class and working class Americans and Europeans.
Ironically, though, some of the pollsters have for a long time been on the money in reading the new Zeitgeist. Poll after poll has consistently shown that the majority of people in many countries believe that their countries are heading in the wrong direction. The trouble is that people didn’t listen until it was too late- and some people are still not listening.
The discontent is getting worse. Take as an example the latest Ipsos MORI “What Worries the World” poll. This is an online survey of adults under 65 in Argentina, Australia, Belgium, Brazil, Canada, China, France, Britain, Germany, Hungary, India, Israel, Italy, Japan, Mexico, Poland, Peru, Russia, Saudi Arabia, South Africa, South Korea, Spain, Sweden, Turkey and the United States. The poll finds that across all countries, the percentage of people who think things are going in the right direction in their country has dropped by 2% since last month to 37%.