The year of the woeful politicians

The fiscal deficit is the highest since 2012. Trade wars notwithstanding, the trade deficit is at a 10-year high.

The turnover on the presidential staff has reached catastrophic levels: 65 per cent of Trump’s “A Team” had been replaced since his election, according to the Brookings Institution, and that doesn’t even include cabinet members (12 of the 24 officials in the Cabinet have been replaced and now a 13th, Defence Secretary James Mattis, is leaving). All this doesn’t even scratch the surface of what Trump has done. The damage he has wreaked on the US role in the world is only beginning to manifest itself.

Almost as obvious is the misgovernment of the United Kingdom. Blind to the reality of disappearing economic growth, slowing business investment and a growing trade deficit, Prime Minister Theresa May’s government has persevered in trying to pull the country out of the European Union and in fantasising about withdrawal terms that the European Union (EU) rejected from the start.

Destroyed by the EU’s dream team of super-competent negotiators, May’s bungling, ill-prepared representatives flailed about, resigned in exasperation and finally produced a deal nobody really wants — not even the EU, though it’s skewed heavily in its favour.

Last year, President Emmanuel Macron of France looked like the western world’s great hope with his sweeping reform plans and a grand vision for a tighter-knit EU. He ends the year in retreat before what’s looking like the most effective Facebook-driven revolt in a western nation to date — the Yellow Vest movement that started as a protest against a small increase in fuel taxes, but grew into a violent anti-elite rebellion.

Macron has undermined his reform ambitions by making concessions to the Yellow Vests worth up to 11 billion euros (Dh45.97 billion) a year, and his popularity hasn’t recovered, remaining at a dismal 27-per cent approval in public opinion polls.

Another potential leader of the west, German Chancellor Angela Merkel, spent most of the year hobbled by an open revolt within her party, the Christian Democratic Union, and its Bavarian sister party, the Christian Social Union.

The conservative rebels paralysed the government demanding tougher immigration policies and forcing Merkel into exhausting back-room battles that left her drained, sometimes even apathetic. The Union performed badly in two important state elections, and Merkel was forced to give up the party leadership.

This was a year of chaos in other democracies, too.

The populist government in Italy drew up a fantasy budget that included a version of a universal basic income and fought with the EU over it (only to end up lowering its unrealistic projections) while the economy slid towards recession.

In Spain, Mariano Rajoy’s centre-right government buckled under the weight of corruption scandals and the outgoing prime minister spent a whole day at a restaurant as Socialist rival Pedro Sanchez unseated him in a kind of parliamentary coup. Sanchez, however, isn’t doing too well, either: His government is beset by scandals, he faces a reprise of troublemaking by Catalonian separatists that made it almost impossible for Rajoy to focus on anything else. Now, for the first time in decades, a nationalist-populist party, Vox, is gaining popularity and has won representation in Andalusia’s regional parliament.

Russian President Vladimir Putin was re-elected, but has since seen a drop in popularity following a highly unpopular retirement-age increase. Russia’s economy and Russians’ incomes are stagnating and Putin’s been constrained overseas by a string of public failures by Russia’s aggressive military intelligence service and an inability to build a working relationship with the US.

India’s Prime Minister Narendra Modi goes into 2019 having lost elections in three states where his Bharatiya Janata Party was previously dominant.

Modi’s hubris and the lasting effects of his policy mistakes, such as the disastrous “demonetisation” of 2016 in which Modi took 86 per cent of the country’s cash out of circulation, are partly responsible for his weakening hold on power.

Urjit Patel, the central bank governor, resigned earlier this month after Modi’s repeated attempts to weaken the bank’s independence and get control over its reserves. Though economic growth has been strong, it hasn’t been inclusive as Modi had promised; unemployment hit a two-year high in October.

Viktor Orban in Hungary, whose Fidesz party won a supermajority in an election in April, appears to have overplayed his hand with a series of moves aimed at consolidating his power over courts and media, as well as a recent law that has the potential to force Hungarians into working overtime for pay that would be delayed for three years.

The shortage of competent, clear-headed, hubris-free leadership in today’s world may be a freak accident. It could signal the deterioration of institutions, both global and domestic, that shape our lives.

— Washington Post

Leonid Bershidsky is a noted columnist covering European politics and business.