This is the summer before the storm. Make no mistake, with energy prices set to soar to unprecedented heights, we are approaching one of the largest geopolitical earthquakes in decades. The ensuing convulsions are likely to be of a much larger magnitude than those following the 2008 financial crash, which sparked protests that culminated in the Occupy movement and the Arab Spring.
The mounting crisis could prove even more disastrous than the oil shock of the 1970s, which devastated the governments of three British Prime Ministers, heralded 40 years of American entanglement in the Middle East, and (because of the oil glut that followed) eventually led to the collapse of the Soviet Union.
Carnage has already arrived in the developing world, with power cuts from Cuba to South Africa. Sri Lanka is just one of many low-income countries where leaders are in danger of being ousted from power in an ignominious eruption of gasoline drought and loan defaults.
But the West will not escape this Armageddon. In many ways, it even seems to be becoming its epicenter – and Britain, its Ground Zero.
In Europe and America, a technocratic elite system built on mythology and complacency is crumbling. The fable of the foundation – which foretold the glorious entanglement of nation-states in world government and supply chains – has spread into a parable of the dangers of globalization.
Despite all efforts to portray the war in Ukraine as a black swan event, a spike in basic commodity prices in a volatile world was perfectly predictable. People are wondering why their leaders haven’t made contingency plans as they sit on vast untapped reserves of gas, oil and coal. The EU held out despite Putin’s attempt to divide the region’s market and dominate its more compromised powers.
There is no explanation for this fiasco either, other than decades of failed assumptions and policy missteps by our ruling class. In the wake of the financial crash, the establishment almost succeeded in convincing the public to submit to the purging austerity measures, convincing voters that we were all to blame for the crisis and all had a part to play in reconciling. of the country’s faults. This time, elites cannot escape responsibility for the consequences of their fatal mistakes.
Simply put, the emperor has no clothes. The establishment simply has no message for voters in the face of hardship. The only vision for the future it can conjure up is net zero – a dystopian agenda that takes the sacrificial politics of austerity and financialization of the global economy to new heights. Actively campaigning for boiler bans, 15mph speed limits and speculative green bubbles may seem like madness. But it makes perfect sense for an elite detached from the real world.
There are several countries where we could see the first signs of a resulting populist uprising. The Germans have to swallow national humiliation along with higher energy bills as their political leaders are reviled on the world stage for their naive attempt to prioritize economic harmony and trade relations over security. According to some analysts, France, which is no stranger to protest, could be the first in Europe to suffer blackouts, despite its sizeable nuclear industry. But it is Britain where it can really blow.
The UK is arguably the tinderbox of Europe. With the impeachment of Boris Johnson and his imminent replacement by a politician who will not have brought his or her party to power by universal suffrage, the political context is particularly feverish. Especially given the disillusionment with the waste of the past two years and the government’s failure to take advantage of Brexit to renew the country.
In addition, it looks like UK consumers will be cheated harder than most. We already have the highest inflation in the G7. But a succession of fatal policy mistakes – from closing gas storage facilities to failing to exploit our domestic oil and gas reserves – means we will remain unnecessarily vulnerable to skyrocketing international energy prices for years to come, with all the pain that will bring to consumers.
Despite this, Britons will receive less aid from the government than their counterparts in other Western countries. The 5 pence fuel tax cut is estimated to be the second smallest in Europe. While our politicians are positing about insulating more houses in the distant future, Spain has made many train journeys free until the end of the year. France has vowed to completely nationalize energy giant EDF, which it had already forced to cut consumer bills.
A civil disobedience movement inspired by the uprising against the poll tax has already been launched here in the UK. The Don’t Pay campaign, which urges people to join a “mass non-payment strike” when the energy price cap is raised in October, has gained thousands of online supporters.
And if it does get off the ground, what can the authorities do about it? The price hikes to come are so great that millions are simply unable to pay their bills – including retirees and families hitherto middle-class. The risk is that the Tories, entangled in leadership hunts, realize too late that they must act. The predicament we face is likely to be game-changing. We barely realize how unpredictable the coming years will be – and how ill-prepared we are to face the consequences.
If cutting ourselves off from Russia – a relatively small economy – is painful, how can we end our addiction to cheap goods from China? If we succeed in achieving greater levels of energy self-reliance, how will we deal with the collapse of the Middle East petrostates and the migration crisis that is likely to follow?
This may sound like a grim forecast, but especially in Britain it feels like we have entered the final act of an economic system that has clearly failed. It is clearer than ever that the Emperor has no clothes and no more stories to distract us with.