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Welcome, 2022! We have some questions

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From inflation to the pandemic, Taiwan to Ukraine, and beyond — Grid’s global editor looks at the year ahead and what to watch for.

When it comes to global events, forecasting can seem a fool’s errand. I recall moderating a panel in the last days of 2019, with experts opining about the year ahead. They offered GDP forecasts, predictions for geopolitical hot zones and so on. I went home feeling well-informed, a bit more mentally prepared for whatever 2020 might bring.

Hear more from Tom Nagorski on this story:

Pity the prognosticators, I thought later. They didn’t just miss the mark in one or two areas; it was a forecasting disaster. But in fairness, how could they have imagined what lay in store? Who could have known that as we spoke, a microscopic predator was raging through Wuhan, in central China, the start of a journey that would ravage the planet and make a mockery of nearly every forecast for 2020?

Here we are in the early days of a new year. I won’t risk the same fate, but as the global editor of Grid, I will share a few thoughts on what my team and I will be watching in the days and months ahead.

All roads run through Beijing
Global forecasts tend to aim narrowly at markets and elections and datelines for crisis. But this is a moment to set aside traditional focal points and think big. “Big” as in large-scale issues and trends, and the planet’s ability to handle them.


Let’s start with China.

China, which holds keys to the climate crisis and the North Korea impasse, supply chain meltdowns and a post-pandemic economic rebound, and more;

China, where the debt bubbles of Evergrande and other overleveraged companies risk a Lehman-like collapse and global ripple effects;

China, as in the U.S.-China relationship, at its lowest ebb since the Nixon-Mao normalization;

China, as in the prospect of actual conflict over Taiwan.

Is your head spinning yet? Let’s focus on two words, a phrase worth paying attention to as the new year begins.

Have you heard about “Common Prosperity”? You would have, often, if you lived in China. Two words that sound nice and anodyne enough. Who can argue with “common prosperity” and the way Xi Jinping defines his new pillar of domestic policy? In the Chinese leader’s vision, “common prosperity” promises a fairer distribution of wealth and a better life for his people while avoiding the divisions and instability that income inequality brings.

It’s also a not-so-subtle dig at Western democracies, the U.S. in particular. Xi and other top Chinese officials have used the botched U.S. response to the pandemic and the Jan. 6 storming of the Capitol to argue that the American model isn’t working. In Xi’s formulation, China by contrast “must resolutely guard against polarization, drive common prosperity, and maintain social harmony and stability.” He pledges to support the middle class, improve social services, and bridge a growing wealth gap between rural and urban populations. Along the way, China will punish those who get rich at the expense of others.

It’s a grand set of ambitions — one that might actually resonate on an American campaign trail. But whenever a Chinese leader adopts a branded dogma (see “Great Leap Forward” or the more recent “Belt and Road Initiative”), it bears scrutiny.

So, key questions for China and the rest of the world:

Can “Common Prosperity” deliver?
Can it coexist with Xi’s other main goal — a return to robust GDP growth?
What happens if it fails?
Tests will come soon. The ever-lengthening shadow of the pandemic and China’s “COVID Zero” posture risk more shutdowns and further economic pain. Meanwhile, “Common Prosperity” has already brought a crackdown on China’s e-commerce and fintech titans, part of a “tech-lash” that has meant an estimated $1.4 trillion in lost value. And Evergrande and the other debt-addled entities are facing default. Among the dilemmas for Xi and for China: “Common Prosperity” might dictate a policy of let the Evergrandes fail and let the bubbles burst, but doing so precipitously would punish the Chinese economy writ large. Think “too big to fail” — a phrase that was controversial enough in the U.S. In China, big bailouts for wealthy speculators will look like sacrilege.

Longtime China analyst Christopher Johnson put it starkly, speaking of these and other challenges (a rapidly aging population and a shrinking workforce) for Xi: “He’s either going to find a way to succeed, or he’s going to crash the plane.”

Nightmare scenario
At a moment when the U.S. touts a lighter global footprint and fewer large-scale military deployments, the risk grows of conflict between the U.S. and China over Taiwan. As Grid’s Josh Keating notes in a piece coming out later this week, such a war “could produce a scenario the world has managed to avoid over the 70 years since the introduction of the atomic bomb: direct exchange of fire between two nuclear-armed superpowers.”

Could it really come to that? War, between the U.S. and China? It’s tempting to say, “Of course not.” Not when both sides recognize just how nasty the consequences would be, and when a retreat from overseas engagements is that rare thing — an approach Republicans and Democrats agree on. Not to mention the fact that the debate over Taiwan’s status has been managed peacefully for decades.

And yet the rumblings are ominous.

In the half century since the U.S.-China normalization, Beijing has never seemed so willing and determined to flex its power, and American policymakers never so uniformly hostile toward Beijing. The Chinese have been on a navy-building spending spree and flown repeated sorties close to Taiwan’s airspace; U.S. lawmakers — in another rare bit of bipartisanship — have responded by slamming Beijing and boosting weapons sales to Taiwan. Provocation on one side breeds provocation on the other.

“China will have to take resolute measures if the ‘Taiwan independence’ separatist forces provoke, compel or cross the red line,” Xi said in his November virtual summit with President Joe Biden. To pro-Taiwan politicians in the U.S., he warned: “If you play with fire, you will get burned.”

In a cover story last year, the Economist labeled Taiwan “the most dangerous place on Earth.” Taken literally, it was a preposterous statement. By metrics of crime and covid and most everything else, Taiwan is as safe a place as any. But the magazine was imagining future dangers: “Military superiority will sooner or later tempt China into using force against Taiwan, not as a last resort but because it can.”

Add to this combustible mix the fact that the U.S.-China relationship is on the skids for other reasons. The countries spar regularly about China’s clampdown on Hong Kong, the origins of the covid-19 pandemic and treatment of the Uyghur population in Xinjiang, which the Biden administration cited in its diplomatic boycott of the 2022 Beijing Winter Olympics.

“Great powers rarely desire to go to war,” said former Treasury secretary Hank Paulson, who managed the China relationship for President George W. Bush. “But history is replete with horrifying examples of how they stumbled into it.”

These questions, then, for diplomats and politicians in Beijing, Taipei and Washington:

Can they find offramps to conflict?
Can they come to understand that the costs of conflict are so great as to render any other outcome preferable?
Existential question
Technically, climate change isn’t a 2022 story, and perhaps that’s part of the problem. Each new year brings urgency on multiple fronts — a looming war, a fresh threat to the global economy and so forth — but it’s harder to say this is the year the planet succumbs.

And yet the urgency in unmistakable. Anne-Marie Slaughter, CEO at New America, put it this way in a recent New York Times piece about Biden’s foreign policy. “What difference does it make,” Slaughter wrote, “whether the United States ‘beats China’ if our cities are underwater, the Gulf Stream stops warming Northern Europe and the United States, and hundreds of millions of climate refugees are on the move? If we destroy the biodiversity on the planet?”

Well said. Grid’s Dave Levitan has mapped the relative impacts of a range of global actions that might finally turn the tide — as he writes, “paths to a cleaner, cooler world” — a reminder of the scope of the challenge, but also the opportunities.

All of which leaves us with just one overriding question here:

Will 2022 be the year when the lofty rhetoric and pledges of Glasgow and prior climate conferences are met with action — and the urgency they deserve?
Prices … of everything
2021 brought a perfect inflationary storm — supply chain disruptions, the “Great Resignation” and depleted workforces, energy supply shocks and more — all worsened by the lingering pandemic. The resultant spikes in demand for labor and energy have boosted prices across the board and around the world. Inflation ranks high on many global risk assessments for 2022. As Grid’s Matt Zeitlin reports, these problems will remain uncertain as long as the covid picture looks uncertain.

These items to watch for, then, in hopes that things turn for the better:

How quickly can energy prices come down?
Will companies and governments act effectively to diversify supply chain lines?
Is the labor shortage — post-pandemic — something industrialized nations must live with for the longer term?
It’s still here
Then there’s that tiny, deadly predator. SARS-CoV-2 has entered its fourth calendar year of existence. That may seem hard to believe, but there’s a reason it’s called “covid-19.” And having endured what you might call “covid-20″ and “covid-21,” we now face the “covid-22″ edition. If 2021 was the year of the covid counterpunch, this will be the year of new treatments, greater vaccine supply and a global reckoning with the latest arrival — omicron. Perhaps most important, it will be a year in which the world’s poorer nations — too often overlooked — will see their fates determined by the generosity (or not) and logistical smarts (or not) of the vaccine-rich corners of the world.

Consider this sad truth, via Grid’s Nikhil Kumar: While the U.S. grapples with vaccine hesitancy and misinformation, hundreds of millions of people in the developing world still sit in the unvaccinated column — people who would line up for a shot tomorrow if only there were shots to be had. As public health officials have reminded us often, and as omicron’s arrival taught us anew: A pandemic isn’t over until it’s over everywhere.

So, what to watch for, in covid-19′s 2022 edition? Answers to these questions:

Will omicron’s wave pass quickly — and without too much global pain?
Will complacency in covid-fatigued populations spark more outbreaks?
Will vaccine supplies and related infrastructure bridge the yawning gap between vaccine-rich and vaccine-poor?
Will the various treatments in the offing help turn the tide?
A Yes-No-Yes-Yes sequence of answers to the above will go a long way toward making 2022 the year when the virus begins its inevitable burnout. The year when it evolves from a thing to fear — to something to manage.

In other news …
We would be remiss to avert our eyes from other 2022 flashpoints: an almost Taiwan-like scenario unfolding in Ukraine, which Russian President Vladimir Putin eyes with a nationalist fervor that nearly matches China’s zeal over Taiwan.

We’ll watch the success or failure — or something in between — of a counterterrorism strategy the Biden administration calls “over-the-horizon.” The concept — that the U.S. can respond to external threats without military bases or the proverbial “boots on the ground” — is the Biden administration’s way of assuring Americans that after the debacle of the Afghanistan withdrawal, the U.S. can deal effectively with the Islamic State Khorasan and other enemies by long distance, wherever they may be.

There are potential additions to the “failed states” column — including in Afghanistan, where famine looms and the Taliban’s ability to hold the nation together is in question. But we must also watch Lebanon, Ethiopia and many nations in Africa’s Sahel region. The former top CIA official John McLaughlin gives Grid a sober assessment, two decades after the 9/11 attacks: There are more safe havens for terrorists today than there were then. Circumstances in these strife-riven nations may only make that worse.

We’ll watch the nuclear programs — and related diplomacy — in Iran and North Korea. And we’ll watch the ballot boxes in many nations — including in South Korea, where a tougher line toward the North is a key campaign issue; in France, where Emmanuel Macron faces a pair of right-wing challengers; Brazil, where Jair Bolsonaro has been pilloried for his handling of the pandemic; and here in the U.S., where midterm elections may be as closely watched as some presidential elections in years past.

Lastly, a note of optimism, because — well, because we could use one.

On the eve of the 2021 Summer Olympics, the International Olympic Committee and officials in Tokyo were roundly criticized for moving ahead with the Games. Surely this would prove the mother of all superspreader events, and given that few fans would be permitted in the arenas, going forward seemed unnecessary and dangerous.

In the event, organizers pulled off an Olympics that were not only safe, but also a tonic for athletes and fans the world over. The Games offered a large dose of something that had been in short supply: reasons to cheer.

It’s probably too much to hope for — given the land mines ahead — but perhaps we can take heart in the fact that the 2022 calendar promises both a Winter Olympics in Beijing and a World Cup Soccer tournament in Doha. Sure, there’s controversy already surrounding the Beijing games, but sports have a special power sometimes — a way of offering moments to look forward to, and celebrate, whatever a new year brings.

From inflation to the pandemic, Taiwan to Ukraine, and beyond — Grid’s global editor looks at the year ahead and what to watch for.

When it comes to global events, forecasting can seem a fool’s errand. I recall moderating a panel in the last days of 2019, with experts opining about the year ahead. They offered GDP forecasts, predictions for geopolitical hot zones and so on. I went home feeling well-informed, a bit more mentally prepared for whatever 2020 might bring.

Hear more from Tom Nagorski on this story:

Pity the prognosticators, I thought later. They didn’t just miss the mark in...

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Global Editor @gridnews Ex-EVP @AsiaSociety Ex-Managing Editor @ABC News RTs not endorsements.

Tom Nagorski

Reporting and analysis on how world events, persistent challenges and mega-trends connect. Sign up for our daily newsletter: http://grid.news/newsletter/

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