More than two-thirds of the way through 2012, it is safe to say it has been an eventful year so far.
From the pageantry of the Queen’s Diamond Jubilee celebrations, to the excitement of the London 2012 Olympic Games, people all over Britain have had plenty to celebrate in 2012.
Less happily, the Euro crisis continues to roll on with no end in sight, Britain’s own economic picture has been worse than expected, and the situation in Syria seems to get grimmer by the day.
There are still more than four months of 2012 to go, which we know will include the London 2012 Paralympic Games, set to begin August 29th, and November’s US presidential election.
Back in December 2011, we asked for your forecasts for how events in Britain and round the world would shape up in 2012.
The top three subjects our participants elected to give their projections for were:
- The UK’s coalition government
- The UK economy
- The European Union and the Eurozone
Those of you who told us your forecasts for the UK’s coalition government in 2012 have been fairly accurate in your predictions to date.
- You said there would be stormy seas ahead for the Conservative-Liberal Democrat partnership, and yet would likely hold together through the changing seasons.
- Individuals taking part in Labs forecast tensions within the government over the EU, Lords reform, and debt-reduction, with both leaders facing pressure from their backbench MPs, and grassroots campaigners. While the stark divide between the pro-EU Liberals and the more sceptical Tories is well-known, in 2012, tensions over Britain’s membership in the EU has arisen not between the two coalition partners (as predicted by several panellists) but within the Tory party. Lords reform did turn out to be a major flashpoint between the two parties, with Cameron withdrawing his support for the Lib Dem initiative, and Nick Clegg removing his backing for boundary reform in retaliation. Somewhat surprisingly, there have not been any public rows over the government’s debt reduction plan, which lies at the heart of its economic policy.
- Others said they were banking on the government’s popularity with the public declining over the course of the year – citing the state of the economy as the cause. This forecast has proved the case thus far, with the UK’s growth forecast being downgraded several times over the course of the year, and the opposition Labour Party consistently outpolling its rivals in government.
- One panellist predicted that Business Secretary Vice Cable would “undermine” Nick Clegg’s leadership. Another panellist forecast meanwhile that Cable and Chris Huhne would commit several “gaffes”, and that there would be two “embarrassing” resignations during the year. Vince Cable is seen to have had a fairly good year so far, however, which could be what led him to recently declare he would consider running for the leadership of the Lib Dems. Meanwhile Chris Huhne, who was once also seen as a leadership contender, since the turn of the year, has resigned from his post as energy sector over accusations (which he denies) that his now ex-wife illegally assumed his speeding points in 2003.
Participants’ economic forecasts have also proved accurate in their pessimism, in the ninth month of the year.
- Most of you taking part speculated that the economy would be in a similar state to the end of 2011, but marginally worse. This has so far proved true. According to the Office for National Statistics, the UK economy grew by 0.8% in 2011. While more robust growth was originally predicted for 2012, the Bank of England recently announced that it expected growth to flat-line in 2012.
- Some panellists predicted the economy might get a “bump” from the Queen’s Diamond Jubilee celebrations, and the London 2012 Olympic Games. In actuality, it seems the extra day off for the Diamond Jubilee actually hurt the economy slightly, while the Governor of the Bank of England has warned that any economic benefit from the Olympics will be negligible.
- A few panellists said they thought the Chancellor, George Osborne, would likely to stick to his ‘Plan A’ of reducing the deficit through public sector cuts, which they thought would protect Britain’s AAA credit rating, but starve the economy. And true to our participants’ word, there are signs the government is trying to think of innovative and low-cost ways to boost economic growth, but the Chancellor has not deviated from the course of austerity in any significant way.
On the European Union and Eurozone, those who participated in the discussion were roughly evenly divided between those who predicted its demise, and those who thought it would survive.
- Many predicted that the EU would live on as a shadow of its former self, possibly with several countries exiting and a “two speed” Eurozone being established. Although this possibility featured in discussions earlier in the Eurozone crisis (and could still come to pass), at the time of writing the EU, Eurozone, and single currency, all retain their same member nations.
- Other participants were correct in some of their more general predictions about the situation in Europe, for instance that “internal divisions” would continue, and that “moves to a closer political and fiscal union” would get underway.
Click on the headings below to read more panellists’ quotes and predictions, representing the length and breadth of views put forward in Labs:
YOUR FORECASTS: The UK's coalition government
“I think Nick Clegg and David Cameron will disagree over more issues to gain favour with their own parties again. I think that David Cameron with give in over Europe and sign the new European treaty against his party and the people's wishes” Karen, Ossett
“Both David Cameron and Nick Clegg will start trying to please their backbench MPs and party members a little more, I expect to see more policies designed to appease those in the Conservatives and Lib Dems who are unenthusiastic about the Coalition. The government will hit a rough patch after the local elections in May, which I expect to be damaging for both governing parties, but ultimately the Coalition will still be in power this time next year” Anon
“A split will likely occur in the summer/autumn, with the Conservatives placing pressure on the Lib Dem policies over the EU, House of Lords and Immigration” Mike, Lancashire
“It'll survive – just! Despite a nitwit like Vince Cable constantly trying to undermine his leader; he should have run for the leadership if he wanted it. Most people will see the necessity of Osborne's policies. The coalition will be greatly helped by the turmoil in state of the Labour party” Chris, North Lincolnshire
“The division in the coalition will not be Conservative versus Liberal Democrat, but those with experience of the world outside politics versus the professional politicians. This will become apparent as the economy stagnates and the professional politicians don't know what to do about it” Gareth, London
“There will be major divisions within the coalition over Europe, and major splits within the Lib Dems over Nick Clegg's failure to get more of their policy priorities accepted” Dan J, Oxford
“I think that we will see further potential divisions within the coalition. I suspect that this is part of the dominant partners’ strategy as we get closer to the next general election. The Liberal Democrats will pay a very heavy price when it does come. Let’s face it, the country is still in a bad shape and the coalition’s policies aren't improving things; this is where the Conservatives will start to home in on the Lib Dems and blame them for holding things back” Anon
“It will remain intact. The Lib Dems will continue to try to create some blue water between the two parties, but will support on major matters. Vince Cable and Chris Huhne will create several gaffes during the year. There will be two embarrassing resignations during the year” Charlie W, East Sussex
YOUR FORECASTS: The UK economy
“A bit of a boost due to the Olympics and the tourists, if all goes well. However we certainly won’t be out of trouble until at least late 2013” James, Cambridge
“The full state of the troubles our economy faces and the implications this has to the man in the street to finally be realised by the public. The economy is not about to go into another recession, we haven’t left the first one and the scale of the recession has yet to bottom” Kevin, Hull
“It will be approximately the same situation as it is now. Osborne has become too fixed in his ideas” Wylie G, IOW
“Continued lack of growth or flat lining unless job creation and relaxation of austerity takes place” Wendy M, North Wales
“The economy will be in a similar position to the one it is in now. 2012 will be a year dipping in and out of negative growth but not straying further than -0.5% or 0.5% with little change over the year as a whole. Unemployment will rise, not hugely but enough to force the government to take action. The debt will not go down anywhere near enough” Anon
“I think the Chancellor will stick to his plan of budget cuts to cut the deficit. I think that this will maintain international confidence (however uncertain) in the British economy, allowing us to keep our credit rating where others such as France may see theirs downgraded. This may lead to faster growth after December 2012. However, if something bad happens, it could push the UK economy over the edge” Anon
YOUR FORECASTS: The European Union and the Eurozone
“Euro continues. Several speed Europe emerges. UK in slow lane – tries to repatriate powers but fails” Anon
“Greece will default on their debts, wiping out the value of the Euro, leading to the breakup of the Eurozone and a return to traditional currencies. Brussels will be subject to more and more countries demanding repatriated powers”” Mike, Lancashire
“The politicians and bureaucrats will continue to fudge and apply Band-Aids. Ireland will drop the Euro as will Greece. There will be crises in other countries because of differences about their financial situation and retaining the Euro. UK/French relations will worsen. Sarkozy will probably lose the election which Ms Le Pen could just win” Wylie G, IOW
“The Euro will suffer a partial collapse and will be re-launched with only the stronger economies participating in it, most likely only France and Germany using the currency, possibly forming a greater political union. The UK will remain in the 'common market' aspect only and will back away from any form of political union with Europe” Anon
“The Eurozone will survive but will have taken a big knock, putting new members to the EU off joining the single currency. A two-stream Europe may begin to develop but not to any major extent. Internal divisions may occur over the allowing of Turkey into the EU but they will probably enter. No countries will leave the EU but Greece may be forced out of the Eurozone. Efforts to strengthen ‘co-operation’ between member states fiscal and economic policies will lead to a new European institution and the taking away of much independent sovereignty from member states” Anon
“A new treaty will be cobbled together, although there will be a lot of infighting. The Euro will survive intact with nobody leaving – there is too much personal and political capital tied up to allow the edifice to crumble. The grumbling will continue in the UK and in global markets but by the end of the year there will be recognition that there is a real commitment to make it work, come what may, and moves to closer political and fiscal union will get seriously underway” Dan J, Oxford
“I think the Euro will implode and countries like Greece, Spain and Italy revert to their Drachmas, Pesetas and Lira again. Their default will cause a second depression causing increasing unemployment throughout EU, wage cuts everywhere and tax increases and populations will revolt” David D, Reading
What do you think has been the most important event of 2012 so far?
And what do you think will be the major event that happens in the remaining months of this year?
