Merry Christmas

And so we reach that time of year, again: both the time of peace and goodwill (should that not be an all-year thing?) and the occasion for out-with-the-old and in-with-the-new (I’ve bored on enough about evolution, revolution and “old” and “new normal” already, this year). This also “heralds” (did you see what I did there?) my latest musings on life, the universe and everything.

As ever, the excuse for this missive is the fact that I am hoping to do my small part for the environment by not felling trees to make cards and envelopes nor draining oil reservoirs to send delivery vans scurrying around the country whilst, at the same time, using the money that I save by doing (or not doing) so to support a very worthy cause. As with previous years, I can heartily recommend St Vincent’s Hospice for any support that you would like to offer and their Just Giving page is just a short click (here) away.

So what do we know about the year just about gone that can help us and what do we think of the year to come which can prepare us? Where to begin!

If we thought that the “Brexit” referendum was going to be the most talked about issue of the year, the primaries and then the presidential election itself in the US put paid to that! The “Leave” campaign was never as far behind in the public perception as Donald Trump was. When he first entered the race for the nomination, he was perceived as a “novelty” candidate that would never achieve the final cut. Some even thought that it was a publicity stunt for his faltering property empire. Bernie Sanders was also a bit of a “no hoper” in most people’s estimation. In true US fashion, however, the outsider should never be ignored. Whilst Bernie seemed intent on bolstering the politics of the possible (if he couldn’t achieve the nomination, he was going to ensure that whoever did, listened to his views, rather than burning the house down), “the Donald”, on the other hand, had other ideas and his dramatic insurgency and rise, with several dramatic implosions (and, at times, explosions) of his campaign, was thought by many to have maimed his party for years to come. Meanwhile, Hilary rode the rollercoaster ride of her life with the toing and froing over her e-mails. All that is, as the rather prosaic saying goes, history.

In the UK, the economy seems to have been benefiting rather than suffering from the prospect of “Brexit” – the third quarter figures (the first period after the vote) were better than had been projected (even before the vote). This was, in part, due to the devaluation in Sterling as a result of the vote but, other than the obvious rise in petrol prices, the downside of the devaluation on import costs has not yet fed through to inflationary pressures. In addition, the Armageddon scenario (“would the last major corporate to leave the UK, please turn off the lights”) has singularly failed to materialise with Nissan (and even Tata – “Brexit” to the rescue of the British steel industry?!) recently re-affirming their commitment to their UK manufacturing base, as well as votes of confidence by Apple and Google.

We do have to remember, however, that all we have at the moment is the outcome of a vote (as I said, the “prospect” of “Brexit”), the fun and games will play out over the next two to three years, whatever the decision of the Supreme Court. Interestingly, the almost farcical end to the trade discussions between the EU and Canada has been seen as indicative of where the UK as an “independent” negotiator on the world stage may actually achieve better results than as part of the EU bloc. It is also, to my mind, a very clear pointer to the fact that the Government should not be pilloried for appearing to opt for what is called “hard Brexit”. The fact is that with 27 other countries (and, as we saw with Belgium, additionally a substantial number of regions with the power to disrupt) there never was going to be anything approaching a “soft Brexit”. With general elections in France and Germany and the Italians still coming to terms with their own referendum result, it seems unlikely (to say the very least!) that there will be a unanimity of purpose across the Channel during the negotiations. When Theresa May said “Brexit means Brexit”, I don’t think that she meant, at the time, that there is only one form of “Brexit”, but that must now be clear to most. It seems close to impossible to expect that anyone will be able to herd the multiplicity of interested cats that would be required to deliver anything other than a fairly basic farewell party - I wouldn’t expect champagne and a gold watch, but we might get some cava, if we’re lucky, and a nice card!

The (eventual) departure of the UK from the EU can also be seen as part of a wider loosening of ties between economic entities, a disassembling of the old economic structures and the onset of what has been termed the “gig economy”. To use an analogy from chemistry, the bonds between economic entities are weakening. We have seen “outsourcing” grow over many years and the “gig economy” is just the latest example and the furthest frontier of this development. In political terms, the equivalent breaking down of relationships which strangled the parties to them was probably most recently apparent and dramatic in the end of the Soviet Bloc. What the capitalist west saw as the ultimate victory of the free market system was, probably, just the beginning of a change in national relationships as a whole. It started with the largest entities that enter relationships – the nation states, and was political, but the trend has slowly moved down the “food chain” to economic relationships, from large corporates to small corporates - hotels (Airbnb) and taxi drivers (Uber). Countries, companies and individuals are now asserting their independence from others, not in an adversarial way but in a show of self-reliance. In fact, we are now encouraging our tools to do so, in the “internet of everything”.

I have wondered aloud, already, about whether politics is going through the same upheaval as the economy went through several years ago and still is, to a certain extent. A key message of the campaign of Donald Trump was that the “small state” (from a regulatory point of view – tax, financial markets, etc.) can co-exist with the “big state” (from an economic point of view - infrastructure spending, trade barriers, etc.). We have already seen this focus in the recent change in approach in the UK (remove the state from certain regulatory areas but boost its economic intervention). Are we at last, several decades after it was first mooted, now going to see a form of the “minimalist state”? The elections in various European countries in the next twelve months will be “interesting” (to say the least!) but, after Brexit and then “the Donald”, anything really can happen (and, now, often does)!

So, what has 2016 achieved and what does it augur for the future? Who knows – only time will tell, but I do think that we are living through a period of the most dramatic change in human existence in scientific, technical, economic and now political terms and what we thought was an exponential rate of change so far this century may well turn out to have been pedestrian. Buckle up and enjoy the ride! As they say at the House of the Mouse – “please keep your hands, arms, feet and legs inside the vehicle at all times” (although the Spanish version is much more lyrical).

Merry Christmas, I hope you have a happy and prosperous (in all the various definitions of that word) New Year.


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