Finally, the positive: The fact that things didn’t get much worse in 2022 was due to the remarkable resilience of Western societies. 2022 was really not a good year. But it offers some cause for optimism. You can build on that. We should make more of this experience.
When we talked about the Outlook for 2022 discussed, was the thesis that the next twelve months would be about the self-assertion of the West – internally and externally. And it was far from certain how things would turn out.
This is how the situation was at the beginning of the year: The shocking experience of the corona pandemic was just losing its terror. But the next challenges were already on the horizon. Satellite images showed an unprecedented deployment of troops on Russia’s western border. It was evident to all who wished to see that a conflict was brewing for which the Europeans were unprepared.
Deep fissures were also visible within Western societies, which called cohesion into question. An unfortunate mixture of right-wing populism and pandemic fatigue had eroded the cornerstones of Western democracy. A violent mob had already stormed the seat of the US Parliament in early 2021, and the then President Donald Trump had cheered him on. A monstrous event. The danger was that the Democrats, who were in power with a narrow majority, would lose their majority in the midterm elections to Congress. With a presidential election looming in France, the extreme right-wing Marine Le Pen had a realistic chance of moving into the Elysee Palace.
Inflation had already picked up speed in autumn 2021. It was clear that the central banks would have difficulties in recapturing the price dynamics that they had been idly watching for too long. Rising inflation, in turn, would deepen political fissures and play into the hands of the populists. Against all odds, the West is in some ways better off today than it was a year ago.
The Case of the Strong Men
It is possible that 2022 will go down in future history books as a turning point – as the year in which the balance of power shifted again in favor of democracy and freedom. Previously, the West made a weak and divided impression. For China’s and Russia’s propagandists, the West’s alleged decadence and impending demise had hardened into certainty. The future seemed to belong to authoritarian leaders who, with a firm hand and strategic foresight, were capable of tough power politics that the aging, effeminate West could no longer pull itself together.
By the end of this year, the balance has shifted: the strong men are left pimped, decimated by their own misjudgments, because truth and contradiction stand little chance in a system built on intimidation and fear. They may have passed the zenith of their power.
Vladimir Putin (70) invaded a poorly equipped army in the neighboring country because he believed the soldiers would be welcomed with open arms. Apparently nobody dared to tell him what the situation in Ukraine was really like. The Moscow leadership recently announced a second wave of mobilization. According to Western estimates, hundreds of thousands have already left the country, mostly well-educated young people.
In China, long-term leader Xi Jinping (69), who has just been appointed for another term, had to recognize that the corona strategy of locking up large parts of the population was endangering his rule. This fall’s wave of demonstrations showed that confidence in Beijing’s leadership is crumbling. After a 180-degree turn in corona policy, he is now letting an unprepared country be infected, in which highly effective mRNA vaccines like Biontech’s are not approved – and thus risking the avoidable death of millions of people. What that means for the credibility of the system remains to be seen.
Would-be leaders in West 2022 also suffered defeats. Marine Le Pen (54) was not elected President of France, although incumbent Emmanuel Macron (45) is not exactly popular. In the midterm elections to the US Congress, the right-wing populist candidates installed by Trump were largely unsuccessful; On the other hand, moderately conservative Republicans celebrated successes, while the governing Democrats did surprisingly well. It wasn’t a good year for authoritarianism elsewhere either: “Tropical Trump” Jair Bolsonaro (67) was voted out of office in Brazil. In Europe, the pressure on Hungary’s Prime Minister Viktor Orban (59) increased: The EU has put the transfer of billions of euros on hold to prevent the country from sliding further towards a right-wing dictatorship. Admittedly, the fact that a right-wing coalition is now at the helm in the third-largest EU country, Italy, is not exactly reassuring, even if it has been fairly moderate so far.
Two factors that have come to light in the past year make me optimistic: the power of freedom and the ability of democratic institutions to correct themselves.
The indomitable Ukraine
Without Ukraine’s impressive will to resist in the face of Russian aggression, the cohesion of the West would probably have crumbled long ago. The Ukrainian people are showing the rest of the world that civil liberties are still worth fighting for and making sacrifices for. It may sound dated, but it’s that unyielding stance that has served as an inspiration for the rest of the world in 2022. This also includes skilful staging. How President Volodymyr Zelenskyy, 44, embodies the role of leader of the resistance is crucial to securing resolve at home and support abroad. This is not only tactically relevant in order to secure further military, humanitarian and financial aid for the government in Kyiv. It also shapes the character of this conflict: opposing the Russian invasion is primarily a struggle for democratic liberties and only secondary to asserting the nation-state. One does not want to become subjects who are helplessly at the mercy of autocratic arbitrariness.
One of the disadvantages of the Western system is its outward appearance. Democracy means permanent dispute. Criticism of the powerful, not least through the independent media, stirs up skepticism on all sides and does not allow blind trust in the leaders of democratic institutions as a bourgeois attitude. Relentless transparency brings scandals to light and makes them public. That rarely looks good, certainly not strong and confident. In an era fixated on the media, the smooth ironed-out propaganda of the autocrats has a clear advantage – until reality stands in such stark contrast to the staging that the truth can no longer be concealed.
The great advantage and historic success of liberal democracy, on the other hand, is its ability to correct itself.
A full stop with consequences
The central banks provided an example of this last year. The US Fed, the European Central Bank (ECB) and others had started the year with the blatant misjudgment that the rise in inflation rates was a temporary phenomenon. Once the consequences of the pandemic had been overcome, the rate of price increases would fall again on their own.
It turned out differently. From autumn 2021 the inflation sensitive to. When energy and food prices soared in 2022 as a result of the Ukraine war, they encountered an already heated pricing scenario. The result is the biggest surge in inflation in generations.
The central banks reacted – belatedly but decisively. Around the world, they’ve slammed interest rates up in quick succession, and they’re far from finished. The consequences of this braking maneuver will still weigh on the economy in 2023. More expensive money means strong headwinds for stock exchanges and real estate markets. Some highly indebted countries could face refinancing difficulties, including Italy. Nevertheless, the central banks are trying to correct their mistakes. And so far they have been acting with a coherence that I would hardly have thought possible at the beginning of this year.
In stark contrast, the increasingly authoritarian Turkish President Recep Tayyiv Erdogan (68) is leading his country towards triple-digit inflation rates. In recent years he has worn out several central bank governors and a head of the statistics office. The citizens suffer. What is missing is the ability to self-correct.
It is by no means certain that the West will succeed across the board in 2023. But a year ago I was more skeptical. It will be crucial that the EU evolves rapidly to overcome the current polycrisis (my word of the year 2022) to be able to cope.
My political Christmas wish would be for a broad debate to erupt in the coming year.
Because of the holidays, Müller’s memo will be published this week without a preview of the date.