27 Dec 2011

What could 2012 hold?

It is, in the immortal words of someone much wiser than I, “the economy, stupid”.

As the New Year turns, it is still hard to determine which will come first: an individual massive bank failure that spooks the entire global financial system, bringing others crashing behind it, or the default of a sovereign economy, causing the disintegration of the euro altogether.

What is undeniable about 2011 is that the capitalist model ran out of road. What once was intimate and national – banking – has gone global, and the governance of financial activity that was once equally intimate and national has not gone adequately global.There is no global regulator. Hence extraordinary financial deals are conducted across borders in nanoseconds that are neither effectively regulated, nor, in many cases fully understood.

The horror of the sub-prime mortgage scandal in the US in 2008 that signalled the scale of what was going on has not been addressed.

In 2012 therefore the stage is set at many levels for financial and consequent economic disaster.

In Europe the ECB (European Central Bank) staved off catastrophe by printing half a trillion dollars and allowing over three hundred banks to draw upon it. But that has only “kicked the can down the road” – my key City source tells me it may have bought three or four months. The euro may or may not have as long.

But it is not just the economy. The greatest threat to world peace lies in the 21st century’s “great game” between two of the world’s biggest oil producers – Iran and Saudi Arabia. Somewhere below the surface in Syria, both are present. The great Sunni/Shia battle is under way. It is being acted out in a contained way in Saudi itself, and in Bahrain, and principally – for all to see, in Pakistan. Pakistan is a big country to watch in 2012.

Try Jon Snow’s quiz of the year

America, battered by Iraq, Afghanistan, and its own economic legacy, will turn inward. In the presidential election, money will prevail as never before (note the changes in political funding laws).

Dissent in Russia and in China will build, partially fuelled by the Arab Spring. That spring itself, now contorted by the bigger “game” to which I have referred, will peak again in earnest in Egypt.

The international community will do nothing about Israel and Palestine. The internal dissent in each entity, fuelled by economic inequality, will continue.

2012 is a daunting prospect and may provoke some return to “small is beautiful” thoughts – the renewal of community and neighbourhood amid shared austerity. Let’s hope so.

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23 reader comments

  1. norm says:

    all good news jon, very refreshing for 2012..:((
    i can see the printing presses working overtime to print all this money thats needed to right all the wrongs. Hindsight is wonderful, 2008: should have let all the “too big to fail banks”fail maybe, would the outcome be different now?

  2. Philip Edwards says:


    Not a difficult one, this. Amongst other things:

    – To survive, capitalism will fight like the cornered rat it is. Mainstream media it owns will continue to peddle modular lies in support. Client states like Saudi Arabia will be used to foment war and divisions in Islam. Deliberately-increased poverty will increase in the West. Gradually, the West will draw nearer to social divisions not seen since Victorian times. The socioeconomic system will be restructured to maintain capitalism.

    – Britain will intensify its lowly, distrusted status as a minor Rogue State poodle to the US Establishment. Both nations will be detested in the East. Both will continue as de facto one party neocon states. Their media will continue to attack those it deliberately impoverishes. All Brit political parties will continue salami sliced destruction of the Welfare State and the NHS and get the country even closer to the American spiv-mafia system of government. The remnants of social conscience will be extinguished one by one. George Orwell’s predictions will get closer to reality each day. Brit Daily Mail middle classes will get even more stupid.

    There’s loads more.

    Happy New Year :-)

  3. Ray Turner says:

    Thanks for cheering me up Jon.

    I reckon the end of the world scenario in 2012 would have been more palatable.

    But Happy New Year anyway…!

  4. margaret brandreth-jones says:

    ‘De Bono’ coming into the equation emcourages us to think laterally.Since I cant think of many things which are not moneycentric; even those abstract notions of sweet love for the sake of it( and who ,most sincerely folks, believes that?)costs to unify the blessedness of union , either holy or not.Speaking of Rome centred piety it is Fiat money which presents an accounting impossibiity and global liability. I don’t pretend to have an inkling when it comes to ‘big money’ my personal experience being limited to a ‘put down’ Nurses working hours. I did start out though with a shilling a week in the TSB, which was a considerable amount in my infancy.
    This circumvention brings me to the strange position as small is beautiful. Small being relative to other smallnesses throws in a flux of what is smallness questions.
    Do I grow food in my garden and call it small or do we grow in local acres and call it small?
    All this pondering on big questions helps me insidiously insert the pressing enquiry of why wooden ties cannot be worn on C4 news.You being at the sub atomic stage of life, having evolved from a time when solid really meant solid can surely remember the Wooden Tops.

  5. SanJuan says:

    A brilliant summary of the big issues. Those of us who are more optimistic might find this summary a little down beat but realistic. Why is it that the world can be so indifferent to such an ongoing injustice as what is happening in Palestine? I guess it is easier this way

  6. Saltaire Sam says:

    The only thing that will definitely be booming is news – ironic given the state of our newspapers, national and local.

    Again we teeter on catastrophe hoping for the emergence of a leader (the re-emergence of Obama?) though there are few signs of anyone in the UK fulfilling that role.

    But as my glass is at least almost half full, I hope 2012 will be the year when the voice of the humanity will be louder than the kerching of the 1%’s bank balances soaring as they pull off yet another scam.

    A happy, healthy and peaceful New Year, Jon, and to the C4News team and fellow bloggers.

  7. adrian clarke says:

    I believe there will be a major and dangerous shift to the Islamic religion and states.
    The Euro will totally collapse and Britain will get its referendum on leaving or not
    I hope the former does not and the latter materialises.

    1. margaret brandreth-jones says:

      I believe that there will be many shifts to and fro, but nothing will change dramatically.. Hold that belief..From a lying down flat posture we will begin to crawl and practice until we perfect standing.
      The Euro will survive . Islamists will proliferate , but in a less extreme way as western influences present the alternative as ‘life is for the living’ and not the hereafter.

  8. David Mc Namara says:

    Very well written and thought out piece Mr Snow . However ,I disagree with you on one point . I don’t think that the author of the quote was a wiser man than yerself . I too have a prediction but it’s sadly too full of “ifs”. If Britain were to have the political mechanism to elect it’s head of state and if You were prepared to run for President , I predict you’d make a great job of it. Happy 2012 Jon , keep up the good work .

  9. Dilyan Dimitrov says:

    For me Mr Snow is the best journalist in UK. I wish him health and happiness.

  10. hannah says:

    What is undeniable about 2011 is that the capitalist model ran out of road. Hey at least there is a little light at end of this horrible year of a greed,selfishness & I’m allright Jack attitut which is caused by the infamous 1% world wide!! Glad to say tho, still having journalist like you, a truely impartial journalist with an independent political views brings a breath of fresh air..A Happy New Year Jon..☺

  11. Citizen Smith says:

    Euro/EU – a few EU members will ‘plan’ to leave Euro – one or two jump .. one or two pushed

    Economy – we will probably move to the boundary of a depression by end of year which will affect most countries.

    Housing – residential values in UK will take a steep dive, 10% could be possible could be 15%. Lots of repossessions.

    Unemployment – 3.5 unemployed by end of 2012 in UK due to global economic events. Gradutes and other young will become more poltically aware due to their inability to get a job. Lots more unrest, but politically motivated.

    Labour – Milliband will go by end of year. Ineffectual leadership. Labour must do something in 2012.

  12. Philip Edwards says:


    If you want to know why decent people despise everything the Tories stand for, try this:

    This demonstrates what has been said for years after the Tories deindustrialised outside the south east and reduced many communities to poverty, and not just in Liverpool. It was a deliberate, traitorous act that betrayed the hopes of generations to come. The Tories are nothing but a gang of organised cowards and liars who tried to hide their betrayal behind a skein of Murdoch and other mainstream media propaganda.

    The Liverpool people and the miners in the end were the only ones to try to protect their families and livelihoods. They may have lost a series of battles but in the long term they have been proved to be right about what was being done to them. Their courage is beyond estimate.

    Now, in 2012, WHAT ARE YOU IN CHANNEL 4 NEWS GOING TO DO WITH THIS REVELATION? Will you report it in the depth it needs? Will you attempt to call to account the guilty ones still alive?

    Or will you just potter along, business as usual?

    1. Tom Wright says:

      What utter nonsense. Clearly you don’t expect anyone to click on that link: I did, and it proves absolutely nothing.

      For anyone who can remember 1981, Liverpool was synonymous with the Militant Tendency, the Trotskyist organisation that was then infiltrating Labour and unarguably cost it several election victories by totally depriving it of support from the centre – ordinary citizens who did not want to be governed by a rag-tag bunch of socialist revolutionaries – its the likes of Derek Hatton who inspired popular TV series like ‘Citizen Smith’ – he was a sick joke and a national shame.
      The Militant Tendency wrecked Liverpool and made central intervention in its economy politically impossible. It was ‘progressive’ in the same way that cancer is. Voters in Liverpool deserved better.

      Same applies to miners. Arthur Scargill and his lot were a disaster for their own supporters – this man made himself President for Life, and had unsecured loans out of union workers pockets, appeared in Private Eye on countless occasions and to this day lives in a grace and favour apartment paid for by ordinary folk – he makes the Bankers look clean.

  13. Tanya Spooner says:

    A very good summary, Jon. Thanks to you and all the C4 News team, including the back room folk, for bringing us such careful coverage of important Uk and World issues. Sometimes I have found it too painful to watch, but I respect and admire the dedication which makes it the superior news on all channels. I wish you all the best of new years, and congratulate you on your great professionalism. Long may it continue!

  14. adil says:

    I would argue that perhaps the use of the term capitalism is incorrect and we should really be talking about the demise of consumerism. It necessarily was (daring to use the past tense) an unsustainable model. Perhaps we should look more at a sustainability model (maybe sustainism) making more efficient use of what we currently have. There are ample development opportunities there (an interesting problem to tackle would be cleaning up the ‘island’ of plastic that’s floating around – some call the pacific trash vortex and others). Those that have pensions should be given a simple chart
    to show just where there money is being invested. It would make it easier to ensure investment in sustainable industries. We ourselves should also move away from the illusion of the get-rich-quick promises of the financial markets (those almost always happen to the detriment of another group of people since it’s a zero sum game). We, with our pensions must hold our fund managers accountable and warn them we are not interested in unethical investments and much more value ethical investments. I think that perhaps it is possible to transform to such a model.
    I hope the New Year will be a good one for all

  15. ben says:

    There are many journalists, but only one Jon Snow.

    All the best and let’s make the most of 2012.

  16. margaret brandreth- jones says:

    Since I havn’t anywhere to comment on your escape to the country antics ; here will suffice.I felt a queezy ticklishness and slight horror at the perfunctory way the three venturers tackled the coup de gras of those beautiful crustaceans.I suppose it helps if one isn’t able to empathise with pain and suffering and one not being either rich enough or hard enough to be involved with the country set admit to lower middle class softness.

    Now kathy talks of her high standards ; I hope she was being ironically self deprecatory .. no I apologise , the otherwise perception of tongue not in cheek shouldn’t have flowed through my said, rather vacuous shell like, cerebral cortex which others seem to accredit themselves with the implantation of knowledge thereof …or lack of it..

    What a magnificent sloe chase you went on jon. You dived through thorny bush , backed off from the terrors of confrontatory opposition and bounced back in an attempt to make a red gin sauce.

    Those poor little bunnies ..aw! i’m afraid that does it.. more quorn on the menu.

    Happy New Year to all and many more years of posing.

  17. Meg Howarth says:

    It’s not capitalism (profiteering) that ran out of road last year but the giant Ponzi debt-based version that’s ruled our lives since financial deregulation. Was bound to go bust. The various ‘deficit-reduction’ schemes playing out across western countries are attempts to close the bathroom door. Too late. All has been revealed. It’s a bum deal – even the FT predicts increasing social unrest.

    No surprise therefore to read in today’s FT of the damage-limitation exercise now preoccupying our one-policy (GDP growth) political class:

    ‘Cameron to tighten screw on top pay – With bank bonus season near, Conservatives, Liberal Dems and Labour all devising policies that reflect public indignation’.

    Bankers’/CEOs’ pay is but a symptom of the nasty underbelly of capitalism. The property issue that lies behind the sub-prime crisis is the one that needs addressing. Adrian may sneer, but the need for land tax is vital to stem the social evil of landbanking – waiting for prices to inflate to max on unearned income.

    The people of the world are awaking – a great sight and sound. My wish for 2012 is that the political class and its parasitic lobbying, think-tank advisers get their wings clipped

  18. silly says:

    Perhaps the world and brain as it has been formed is not conducive to the creation of accurate or useful small statements about its large numbers of things and that this is a part of why it is faulty. Hey I just felt like saying something obvious! Here’s another one: Rome falls again this time in the form of the USA.

    “I reserve the right to democratically vote in someone to undemocratically interfere with the rest of the world!” Anon.

  19. Saltaire Sam says:

    It would seem that we are in for new, more honest politics in 2012.

    I base this on the tories’ condemnation of Alex Salmond only telling the electorate that the referendum on Scottish independence would be in the second half of the parliament and not spelling it out in his manifesto.

    I assume this means the tories have had a Damascan moment and that from now on what is said in manifestos will be what they do in power. So, no top down revolution in the NHS will mean just tht next time, eh fellas?

    And, of course, your coalition partners won’t promise to scrap tuition fees, then decide that tripling them is a better idea if it means you get a cabinet seat?

    How refreshing this new politics will be. But what a pity the revelation of what is right only came in time to impose it on a country where the tories have but one Westminster representative and not before they plunged the country into more chaos.

  20. Saltaire Sam says:

    In the last few weeks I have found out exactly what 2012 will hold – a hammering for pensioners.

    As someone living on not much more than the state pension, I have always been grateful for the few perks, especially subsidised travel and the excellent Staywarm scheme that ensures the elderly, who spend more time at home than most, don’t die of hypothermia.

    Recently I was told that my Staywarm payment is about to increase by 25 per cent.

    The wonderful West Yorkshire scheme that saw pensioners travel anywhere by rail in the county for 50p each way has been changed to half price. Generous, you may think, but still a 100% increase on a trip from Saltaire to Leeds.

    Add to that housing insurance up 25%, food by at least that much and it would seem the only other sector going up like this is the wages of footsie bosses.

    Now if only the government could find a pot of money out there. Where could they look: Vodafone? Goldman Sachs? Philip Green? Tony Blair? The olympics (too late). Unnecessary wars? (too late). Trident (what and not be a world power. Damn it, man, this is Britain)

    I’m thinking of moving to Scotland.

  21. John Hirst says:

    I listened to Jon Snow’s report on the decision to expand nuclear energy production and its impact on domestic energy bills. It seems to me that there is one source of power that is more or less completely ignored in the energy debate, namely manpower. Apart from riding a bicycle rather than taking a car (as David Cameron was portrayed as doing before the election) there seems to be no consideration given to how human energy figures in the total mix. Given that before the industrial revolution, human energy was a major factor in the economy it is surely worth considering, particularly if it would help towards saving the planet. Obviously in the past some human labour was very unpleasant and dangerous and replacing it by machine operation has been beneficial. However in many contexts jobs are taken from humans and given to machines with no clear benefit to anyone. I am thinking of, for example, the office tea person who is replaced with a vending machine. This job is not onerous and many seem to find it quite enjoyable because of its social content. If homes are being asked to insulate and adopt energy saving measures why not do the same with businesses when it comes to the mechanisation of functions? It would also have a beneficial effect on the labour market by preserving jobs. It might be possible also to ‘de-mechanise’ to some degree. In the same way that a bicycle can be used in some contexts instead of a car, there must be other contexts in which a system using less generated energy could replace one that is very generated-energy intensive. It seems hardly to be wondered at that as more and more work is mechanised there is more and more unemployment. The government could tax companies for replacing human labour with machinery when there was no clear benefit to health or any other social good derived from so doing. John Hirst

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