joint blog with Tracey Follows
It’s already being called Awful April, as a long list of price rises will take effect, from energy bills and fuel to council tax, stamps and food prices.
This has been expected since the start of lockdown two years ago – my own blog two years ago listed some of the more obvious consequences:
Some lingering impacts of COVID
Only fools thought we could switch off most of the NHS and much of the rest of the public sector for two years without having to pay massive catchup costs afterwards or that millions could be paid to watch TV at home instead of working with no economic consequences. I guess some might still consider themselves lockdown winners if the coming cost rises are still less than the free money they received in lockdown. We all have to pick up the bills whether we were fully paid, received furlough cash, received all the revenue and associated profits from the business shut down next door (Amazon, takeaway outlets etc), or were among the 1.4 million self-employed left with no jobs and no state support to live off their savings by Rishi “I can’t solve every problem’ Sunak.
The Ukraine war obviously has made costs rises even worse, and government are very keen to make sure everyone blames that and not their policies, but don’t be fooled. Most of the price rises coming will be directly due to government lockdown policy (, and most of the impact of the war on energy costs can be blamed on government green policy (a more sensible government would be largely self sufficient on energy, using our own oil, gas and nuclear energy and a little renewable, with only a little oil needed from overseas). The war will directly impact grain yields from Ukraine this year and next and that will cause price increases beyond our government’s control, but that will be a small proportion of the rises you’ll see.
Some people are wealthy enough to manage just fine without any reductions to their standard of living, but very many will struggle to cope with massively increased bills especially with pay rises well below inflation. Many older people have been watching their life savings evaporating at the inflation rate for years, with their only realistic alternative to gamble on an overheated stock market expecting a crash imminently, or a property market also expecting major correction. Many of those who enjoyed lazy years at home during lockdown are being forced back to the office, with all the extra spend that involves.
As many are forced to reduce optional spend, many businesses will see drops in income. Magazine and news subscriptions will fall, app and Patreon subscriptions will be cancelled, some may even consider cancelling Sky, Prime or Netflix. Chippies and takeaway restaurants will have to eat into some of the savings they made during lockdown while the sit-down restaurants they were transferred lockdown revenue from will struggle even harder to recover their pre-lockdown occupancies. Cars and mobile phones will wait longer to be replaced, cinemas will find their recovery from lockdown is made even more difficult. Many families will already have turned down their thermostats and will try to reduce electricity usage. They’ll also reduce the number of car trips to go the the shops or the seaside and take cheaper holidays, reducing tourist revenues.
All these are immediate impacts, but they will last, maybe for years, until long after the Ukraine war has ended.
Some longer term impacts are also becoming obvious too. 30p per unit electricity is making a lot of people wonder just how sensible Net Zero is. For two decades we have closed coal, oil and gas electricity stations, and avoided building new nuclear capacity, while instead investing heavily in by far the most expensive and useless energy solution – offshore wind energy – at 6 times the cost of using shale gas, one of the best ways ever invented to transfer wealth from the poor to the rich. We’ve watched electricity rise from 6p per unit to 30p, and for what? The Chinese have just laughed at our economic suicide and built massively more carbon based energy generation, and along with India have been very happy to accept the industries we’ve shut down to reduce CO2 emissions. The atmosphere doesn’t care much which country emitted the CO2. The Russians are making the most of our folly too, charging very heavily for gas we should by now be taking out of our own ground. In short, we havent saved CO2 generation much at all, we’ve just exported it, and have created huge extra costs for ourselves with no significant benefit except to our global competitors and indeed enemies. I have no way of knowing if it’s true or not, but I can easily believe the rumour that some green activist funding has come from Russia and/or China. You’ll need to draw your own conclusions.
But this increasing awareness of the stupidity of our governments will have consequences. Net Zero will not last. Even the EU has accepted finally that gas is a good intermediary to keep us going until fusion comes on stream in the 2040s/2050s alongside desert solar farms with super-cables from the Sahara into the EU grid. Gas emits half the CO2 of coal and oil per unit of electricity. Shale gas is very abundant, the UK has around 600 years supply, though we’d likely stop using any by the end of this century. As for climate change, the numerous apocalyptic projections over the last 25 years have failed to happen. Now scientists say we’re very likely in a long period os solar minimum that will greatly offset or even exceed warming influences from CO2 production until around 2050. If we’re greatly reducing CO2 emissions by then, the problem goes away. It’s no longer a problem worth losing sleep over. So if there’s nothing to worry about, why bankrupt or economy to solve it? Why especially, if our enemies and competitors just watch our economic suicide but aren’t dumb enough to join in?
So it is highly likely that government will be forced, under threat of party extinction, to drop some of the more idiotic green policies, while taking less notice of green activist groups, or indeed Carrie. Shale gas should be permitted, off-shore gas production increased, and small modular nuclear reactors should be encouraged. R&D in solar and fusion tech should also be increased. The drive towards uneconomic heat pumps should also be dropped.
Similarly, the uneconomic HS2 project should and likely will be abandoned. Government can save face by keeping the name, but downscaling and transforming into a more sensible rail reformation and some regional improvements seems inevitable.
The BBC license fee was already under threat, but that threat has now markedly increased.
As it becomes obvious that the UK was the only country to essentially shut down most of its health service while a few percent of its workers focused on dealing with COVID, the NHS has also lost a great deal of the love it had. Already, many people are going private to avoid the queues for essential operations and a great many others are now paying private companies to see a GP. These numbers will greatly increase, casting great doubt on political support for future tax rises earmarked for NHS funding. Why pay twice? The increased national insurance will stay to help pay the bills for an ageing population, but NHS will have to fight harder for every penny, and accept long overdue reforms.
It is within this environment of dwindling inflation-hit savings and steep increases in the cost of living that many might turn to cryptocurrencies as a hedge against the worst effects. Of course, not everyone has the disposable income to set aside for speculative assets but increasingly people are going to be looking for places to ‘put their money’. If it’s not cash under the mattress it could be tokens in a wallet. Plenty more scams and hacks will take place though, with more people losing out purely because they tried to set up an insurance policy but weren’t necessarily wise to the downsides. But is it worth the gamble? Many will say yes.
For it is not hard to see that we could be on the cusp of an entire financial collapse in Europe. The underpinnings of our financial system are being slowly removed brick by brick until the whole edifice will become structurally unstable. When the US and EU announced sanctions on Russia following its invasion of Ukraine, they thought they were punishing Putin and the Russian people, that these would lead to inevitable domestic unrest and the people would stage a putsch. That may have worked in other countries in the past but Putin has turned the tables. When the US, Japan and EU shockingly barred Russia’s Central Bank from tapping into the billions of foreign reserves Moscow had been saving up in their banks, Putin bided his time, bought even more gold (at 5,000 rubles a gram) and then demanded that any gas from today, 1st April 2022, must be paid for in Rubles. With ‘Gas for Rubles’ the West has two choices: pay in a way that strengthens rather than weakens the Ruble, and therefore Putin – or see their citizens go cold and their industrial base crumble. If they choose to double down, we will see manufacturing industry collapse as the cost of energy becomes prohibitive for factories and businesses in Germany but then spread across the continent. The sanctions the West took against Russia were always going to backfire, the only people punished will be the citizens of the West – with the pressure on business costs now being added to the pressure on living costs.
But don’t worry, if you don’t like any of this you can protest. Can’t you? Well, Western governments have been busy bringing in new laws and regulations to deter all forms of protest amongst the masses. And big tech will be very happy to oblige no doubt. In the same way they have started to label all and any content about the Russian perspective during this time as ‘Russian-state affiliated media’ – no matter who is disseminating it and why, they will no doubt censor anyone who complains about the impact of Net Zero madness, or brand them ‘climate deniers’. When the most helpful advice we get from our energy suppliers or politicians is if you’re feeling the cold, put on another jumper, it’s pretty clear that everyday concerns of consumer-citizens are not going to be taken seriously for quite a while.
Tracey is a futurist and author of The Future of You: Can Your Identity Survive 21st-Century Technology? She is the founder CEO of Futuremade, a futures consultancy advising global brands and specialising in the application of foresight to boost business. She helps clients spot trends, develop foresight and fully prepare for what comes next. A regular keynote speaker all around the world she has covered topics as diverse as the future of luxury, retail, media, cities, gender, work, defense, justice, entertainment, and AI ethics, decoding the future for businesses, brands and organisations. She is an Associate Fellow of the World Academy of Arts and Science, a member of the Association of Professional Futurists and World Futures Studies Federation, and a Fellow of the RSA.
Dr Pearson has been a futurologist for 30 years, tracking and predicting developments across a wide range of technology, business, society, politics and the environment. Graduated in Maths and Physics and a Doctor of Science. Worked in numerous branches of engineering from aeronautics to cybernetics, sustainable transport to electronic cosmetics. 1900+ inventions including text messaging and the active contact lens, more recently a number of inventions in transport technology, including driverless transport and space travel. BT’s full-time futurologist from 1991 to 2007 and now runs Futurizon, a small futures institute. Writes, lectures and consults globally on all aspects of the technology-driven future. Eight books and 900 TV and radio appearances. Chartered Member of the British Computer Society and a Fellow of the World Academy of Art and Science.