Following in Robert Smithson’s footsteps, it’s time to nail my colours to the mast again. At the end of each year, I like to set out my expectations for the year ahead, not because I’m particularly accurate (I’m not) but because it is useful to see where my expectations went wrong at a later date.
My starting point for the year ahead is always the finishing point for the previous year. Where do we start? The whole world has been hit by the most disruptive pandemic in living memory. As a consequence primarily of Covid-19, the British economy has undergone a once-in-a-century contraction this last year.
December has brought two bits of good news, hope at the bottom of Pandora’s Box. First, the world is unwrapping a suite of vaccines against Covid-19, and vaccination has already started at a clip in the UK. Secondly, the UK and the EU reached a deal on future trading. As a result, plenty of people are assuming that things can only get better. Don’t tempt providence.
So, what does 2021 hold in store?
The start of the year could be truly awful
Covid-19 infections are at a high level already, and still increasing fast. Hospital admissions in England already exceed those in the first wave. Before the vaccine comes fully on tap, cases lead inexorably in a couple of weeks to hospitalisations and in a couple more weeks to deaths. There must be a risk that we shall soon see scenes similar to those seen in Italy in March.
The government has now had three tests of its speed of response to Covid-19: in March, in September and in December. It failed all three and many thousands will have died unnecessarily as a result. This third failure is the worst, given the imminence of the vaccines. Boris Johnson has proved to be a deadlier clown than Pennywise.
But vaccines will quickly make a difference
Vaccination has already started. It is proceeding fast: one in nine of the over-80s have already received it. Since the over-80s are the most vulnerable, it will not take long before the mortality statistics – if not cases and hospitalisations – start coming down. With new vaccines coming on stream, we can reasonably expect the nation to be vaccinated by the summer and for first deaths then cases to come down well before then. The Prime Minister has blustered many times about the end of this crisis but his estimate of Easter might this time be reasonable.
The economy will grow quite fast
If Covid-19 is tamed, how could it not, having shrunk by something like 10% this year?
But it probably won’t feel like a boom
The public has been shielded from the worst effects of the crash by government intervention, most notably the furlough scheme. This is due to end in May. Whenever it ends, there is likely to be a reckoning in the jobs market. Inconveniently for Boris Johnson, a sizeable chunk of his support base looks set to be affected. In the short term, the government is likely to keep hosing money at the public to try to mitigate this (this would be the correct decision in the circumstances). Sooner or later, however, the government will turn off the tap.
Even before then we are likely to see more high street retailers fail. January is usually a crunch month. High street retailers have lost their Christmas sales, as has the hospitality industry. Not all of them are going to be able to hang on for another year. The high street is going to look even more forlorn next year.
Britain will be impeded by much worse trade terms with the EU than it previously enjoyed. It has replaced a fairly even deal for ideological reasons with one that is now weighted heavily in the EU’s favour simply by the areas that it covers (which favour the EU’s trade with the UK). It will also entail far more red tape for businesses that trade with the EU. All this will act as a slow puncture on Britain’s economic performance for many years to come.
We will hear less – but still quite a bit – about Europe
The Conservatives want to treat Brexit as a done deal. The Labour leadership want to move onto more promising terrain. So the pro-EU forces will go without senior political representation. But it will continue smouldering all year. The media will want a running commentary on how it’s all going. The many losers from the deal won’t shut up. The younger generation has been radicalised by the last four years and they’re not suddenly going to give up either, however much their reactionary parents and grandparents might wish they would. It is going to be a running sore in British politics indefinitely.
We will hear a lot more about Scottish independence
The SNP look heavy favourites to secure an overall majority in Holyrood with a mandate for another independence referendum. Boris Johnson then has a big decision to make: does he accede to their wishes and risk being the Prime Minister who sees Scotland leave the UK or does he turn Scotland into an English colony, refusing to recognise the SNP’s democratic mandate?
All the signs at present are that he is intending to ignore the SNP’s mandate. All hell will then break loose.
Opinion polls won’t move much
The public is divided into two broad camps: those who think the Conservatives are dangerous and incompetent; and those who think Labour are dangerous and incompetent (spoiler: they’re both right). Because the division is one of values and not of pragmatism, few voters will switch sides in the year ahead, and most will interpret events in line with their worldview. Both Boris Johnson and Sir Keir Starmer will offer plenty of material to support their opponents’ interpretations.
Outside Scotland, Labour should do well at the local elections, in part because they did so badly in 2017 when these seats were last contested and in part because the predominantly-Conservative controlled councils will be jacking up council tax way ahead of inflation just before the elections. This will tell us very little about Labour’s underlying electoral position. That won’t stop them being massively overinterpreted.
I expect Britain will have a wretched start to the year, will have an economic recovery that feels grim (even if it is in fact fairly pacey in terms of raw GDP growth) and will spend much of the year trying to justify its own existence. It will continue to feel an angry, scratchy, divided place.
It’s being so cheerful what keeps me going. Happy New Year.