Predictions for 2017 – if you thought 2016 was bad you ain’t seen nothing yet

2016 was, in political terms, one hell of a year. It saw the greatest destabilisation of the world order since the fall of the USSR, and the most dramatic reversal for liberal-democratic values since WWII. The most important single event, on both counts, was the election of Donald Trump as President of the United States. America is about to get a President who is narcissistic, deeply authoritarian, highly-unstable and who is not a democrat.  My last claim might be somewhat controversial, but it really shouldn’t be. During the Presidential election campaign Trump stamped on just about every democratic norm. He claimed the election was being rigged by his rivals, said he would imprison his chief opponent, constantly attacked the press, promoted outlandish conspiracy theories and even hinted at his opponent’s assassination. The foreign leaders Trump has done most to befriend and praise have predominantly been authoritarian-dictators, most prominently Russian President Vladamir Putin, giving us a good indication of his world view.

On top of the catastrophe in America the liberal-democratic order also took a battering in Europe. In parts of Eastern Europe, namely Poland and Hungary, authoritarian-nationalist governments continued to weaken liberal-democratic institutions. In Western and Central Europe parties of the radical right continued to make gains, and most dramatically the Austrian Freedom Party came close to winning the countries Presidency in May and December. Moreover the key institutions of the European liberal-democratic order, the European Union and NATO, were both weakened. Britain voted to leave the EU in June, becoming the first significant entity to do so. Also in December the Italian people voted against a proposed constitutional reform, leading to the resignation of the competent Matteo Renzi and a renewed threat from populists.

Authoritarian nationalism made further gains around the world. The Philippines elected Rodrigo Duterte in May, who has pivoted his country away from its traditional alliance with America in favour of warmer relations with China and threatened to withdraw the Philippines from the United Nations. In addition following an unsuccessful coup attempt in July Turkish President Erdogan launched a massive crackdown on opposition, destroying much of what was left of the country’s civil society and open opposition to the regime. 

Russia has become increasingly assertive, with its hackers intervening in America’s Presidential election to help Trump (and showing how contemptuous Russia was about any response from Obama) whilst victories in Syria have re-established the country as a significant player in the Middle-East. The country’s economy continues to suffer due to Western sanctions, and ending these will doubtless be one of Putin’s top priorities for 2017. Meanwhile China continued to see impressive growth in both its economy and international standing, and as a successful state run along nationalist-authoritarian-capitalist lines offers a plausible alternative for developing countries to the liberal-democratic model. Moreover the country became increasingly assertive in promoting its territorial interests, most prominently in the South China Seas, increasing tensions with the United States.

So what do I predict for 2017? This is, of course, a perfect opportunity to make a fool of myself, and not one I’ve got any intention of missing. To retain some possibility of being credible I’m going to keep my estimations general, more about themes than specific events. The key developments in 2017 will, I believe, be the end of the post-Cold War international order and the continued decline of liberal-democratic values and institutions. For both these developments the single most important factor will be Donald Trump’s accession as President of the United States. Since the end of WWII America has played a crucial role in promoting liberal-democratic values, and in protecting the liberal-democratic world and the stability of the world order more generally. This is likely about to change. Trump is the first President since WWII, and perhaps even the first ever, who doesn’t at least pretend to believe in liberal-democratic values. He has made it clear that he intends to pursue a nationalistic foreign policy, possibly forging alliances with authoritarian powers such as Russia, and not necessarily defending traditional American allies including NATO members. America will probably cease to be the primary force for global stability, and the anchor of the existing world order, and may even become a destabilising force.

Another likely outcome of Trump’s Presidency will be increased political instability in the United States. Trump’s domestic policy is more traditionally Republican than his foreign policy (which is truly revolutionary). However when you combine it with Trump’s confrontational personal style, his authoritarianism and his past exploitation of white identity politics and racially provocative sentiment, it’s not hard to imagine how significant unrest could be triggered. Doubtless many Americans won’t think Trump has a mandate for radical change as he lost the popular vote by nearly 3 million votes after all. However it’s very unlikely that Trump, or the Republican Party in general, will share this position. I would expect a powerful anti-Trump movement to develop, combining liberals, ethnic minorities, leftists and certain cultural figures. There will be large anti-Trump protests, some of which will turn violent, and a serious possibility of racial unrest. Obama as president has done his best to pour water on various disputes between black communities and the police. Trump may well choose petrol instead. Unless the Republican Party turns dramatically on Trump, and possibly even then, I’d expect America to be more politically and racially polarised by the end of 2017 than it was at the beginning.

In Europe I anticipate the key stories of 2017 to be the gains made by the radical right, and the corresponding weakening of the European Union and Eurozone. The current European order looks relatively unlikely to survive in the long-term, and whilst 2017 may not see it collapse I’d expect it to be badly shaken. There is an argument that the withdrawal of the American security guarantee by Trump will bring Europe closer together. Alas I suspect the EU is too divided and fragmented for this to happen, though close alliances between groups of European states could certainly form.

A toxic combination immigration/cultural concerns, Islamic fundamentalism and relative economic stagnation makes 2017 look very attractive for the radical right. The Freedom Party in the Netherlands, who’s leader wants to outlaw the Koran, has a decent chance of becoming the biggest single Dutch Parliamentary party in March, though it’s unlikely to end up in Government. Merkel will probably be re-elected in October, and then continue to form the core of the European order, though the radical right AfD party will likely enter Parliament for the first time. In Italy Parliamentary elections are possible following Renzi’s referendum defeat, and will likely see gains for both Beppe Grillo’s populist anti-Euro 5 Star Movement, and the anti-immigrant Northern League. If these forces hold the balance of power it could cause a crisis in the Eurozone as a whole, especially if it looks like Italy will hold a referendum on Euro membership. Even if this doesn’t happen fresh elections, should they take place, will put a lot of pressure on the Italian banking system.

The most significant European election in the next year, the one that could truly explode a stick of dynamite under the existing European order, is the French Presidential election in April/May. If the nationalist Marine Le Pen wins it’s hard to imagine either the EU or Eurozone surviving in the long-term in their present form. Even a victory for Le Pen’s chief rival, the centre-right Francois Fillon, will have major implications for European politics as he favours warmer relations with Russia. Last Autumn I argued that there is a greater than 50% chance that a revolutionary event would happen in the next year, by which I meant either Trump getting elected in America or Le Pen in France. I never really expected Trump to win, whilst I always thought a Le Pen victory very possible.

France’s economy has been stagnating for the past few years, she has a problem with Islamist terrorism which borders on an insurgency and she has clearly become a junior partner in European politics after Germany. Moreover some on the left may find it difficult to vote for Francois Fillon, a strong free marketer, in order to stop Le Pen, whose economic policies are closer to their own. All the European parties of the radical right are likely to gain from the worsening relations between the West and the Islamic world under President Trump. If Le Pen wins the post-WWII order in Western Europe is truly finished, and France and Germany could plausibly become rival powers for the first time since 1945. In addition the other key European power, Britain, is already planning to destabilise the European order by leaving the European Union. This, combined with the almost inevitable EU/UK clashes during exit negotiations, will reduce the UK’s influence in Europe and ability to assist liberal-democratic partners.

2017 is also likely to see a significant increase in tensions between America and China. Under Obama’s Presidency these two powers were essentially hostile, but with a stable relationship. Under Trump this hostility is likely to intensify, and the stability will be removed. Trump has been deeply critical of Chinese policy. He has accused the country of stealing American jobs through unfair trade practices, whilst Trump has violated America’s longstanding ‘One China’ policy by speaking to the President of Taiwan. It will be particularly difficult for Chinese President Xi Jinping to show weakness this year, due to ongoing internal issues related to his leadership. There are a number of potential flashpoints between the two powers, including trade, the South China Seas, North Korea and Taiwan. A trade war or military build-up between the two powers is certainly possible.  

Correspondingly Trump looks likely to improve American relations with Russia, considering his behaviour during the Presidential election and his personal warmth towards Putin, and might weaken or withdraw American sanctions. This, combined by the reluctance of European powers to confront him, may well lead to an increase in Russian involvement in European politics, with a particular focus on increasing Russian influence in Eastern Europe. Russia already has good relations with Greece and Cyprus, whilst candidates sympathetic to Russia have recently won Presidential elections in Bulgaria and Moldova. There is some risk of a confrontation emerging from a misunderstanding. Under Obama/Bush it was clear that Russia could intervene militarily in non-NATO member states (Ukraine and Georgia), but that an attack on a NATO state would trigger conflict. As a result of Trump’s friendship with Putin, and questionable commitment to NATO, it is no longer clear what the red lines are. Thus the potential for a misunderstanding is greater, though I’m not sure Putin will want to trigger a crisis during Trump’s first year. In addition Russia’s economy has suffered significantly due to Western sanctions, so Putin may well prioritise good behaviour in an attempt to get these sanctions lifted.

2017 may also see increased Indian regional assertiveness. The Indian economy is estimated to have grown by over 7% in 2016, a spectacular figure, and similar success is anticipated for 2017. Increased Indian influence in South Asia, provided it doesn’t lead to conflict with Pakistan, would be no bad thing. India is the world’s largest democracy, with developed liberal-democratic institutions. The country is governed by a Hindu nationalist, Narendra Modi, but thus far there are no indications that he is trying to undermine Indian democracy. As long as this continues India could become an increasingly important liberal-democratic power in South-Asia, perhaps counterbalancing the authoritarian-nationalist power of China. Considering India’s size, human capital and economic growth rate developments in Indian politics could be crucial to the future of liberal-democracy as a system of government, probably second in importance only to what happens in the United States.

So to sum up if you didn’t like the key political developments of 2016, and I certainly didn’t, I suspect you’re unlikely to think much of 2017. America looks set to step away from her post-WWII leadership of the liberal-democratic world, and adopt a foreign policy based around self-interested nationalism and protectionism. This is likely to result in increased tensions between America and the rising world power, China. Without guaranteed American protection European security with be greatly weakened, and it’s unlikely the EU has the unity or ability to pick up the slack. Moreover parties of the radical right look set to make significant gains in Europe, especially if (as seems likely) the current wave of Islamist terrorist attacks continues. This, combined with tensions inherent in the Eurozone (and the fact that populists are pushing in opposite directions in Northern and Southern Europe), means the European project will probably weaken and could start to disintegrate. The latter is particularly likely if Le Pen wins the French Presidential election, and if this happens Britain will be the only remaining permanent member of the UN Security Council which isn’t ruled by an authoritarian nationalist. In short I’m not saying you need to get digging yet but, if you’ve got a bit of spare time, it probably wouldn’t hurt.

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P.S. If you've made it this far then congratulations. I wrote way too much!