Every year, the editors of TheAtlantic.com take part in a holiday ritual familiar to editors of every newspaper, magazine, and website in the world. Christmas carols? Not quite. Eggnog? Disgusting. Secret Santa? With what, our journalism "salaries"? Haha, no. Instead, we make bold predictions about the next year.
And, inevitably, the next year proves us wrong.
Next week, the business section will keep the tradition alive with another round of baseless prognostication, but before we do, we're going to try to learn from our past mistakes. What did we predict about 2011 one year ago and what did we get wrong? Let's go to the tape!
That's not as embarrassing as I feared. We failed to foresee the big gas spike from early 2011, the ridiculous debt showdown and downgrade from this summer, and the Occupy movement. Otherwise, we didn't do too bad. Grading our predictions one-by-one.
1) Job Growth Would Pick Up: B
2) Tax Reform Would Get Underway: C-
"The White House might try to push for tax reform in 2011," we wrote. Our bad. The White House has stuck to its pledge to keep the Bush tax cuts in place for 98 percent of households, which makes broad-based tax reform less likely. With zero willingness from the right to raise taxes meaningfully on the richest Americans, we were never close to tax reform.
3) The EU Would Be in Crisis: A-
4) The States Would Hold Back the Recovery: A
5) Foreclosuregate Would Roll On: A-
On December 1, Massachusetts sued the nation's five largest banks, including Bank of America and JPMorgan Chase over deceptive foreclosure agreements, the latest in a string of battles between government attorneys and the banks.
6) We'd Pick a Fight With China Over Its Currency: C
We weren't wrong that lawmakers would continue to pressure China to evaluate its currency valuation and pressure Treasury to use the term "currency manipulator" to describe Beijing. But we were wrong to think this would be one of the biggest stories of the year. In fact, it's been one of the quietest big stories of the year. The Treasury Department once again delayed its ruling on China's currency in October to avoid the kind of showdown that we predicted.
7) Congress Would Have High-Profile Showdowns Over Spending: A-
In retrospect, we should have gone further. Sure, we predicted that the Tea Party would throw a fit. Sure, we foresaw that Boehner would tie deep spending cuts to the debt ceiling vote, leading to a "high-octane battle." But we didn't expect it to get just so high-octane. Hours away from a technical default? A first-ever debt downgrade? Apparently the way to play this prediction game is to imagine what the world's most dysfunctional government would do in a given situation, and then take one step toward sanity.
8) The Federal Reserve Would Be Center Stage: A-
Inflation grew slowly. Jobs grew slowly. The Fed sat tight. Dan Indiviglio nailed it.
9) The Debate Over Housing Reform Would Heat Up: C+
"Although Congress and the Treasury began some preliminary discussions of how to reform housing policy in the latter part of 2010, expect the debate to heat up in 2011," we wrote. It's safe to say the debate over housing policy has warmed to room temperature and not much higher. It's hard to get much more out of the Republican presidential nominees than a boilerplate statement that Fannie Mae is to blame for everything.
10) Financial Regulation Would Be Really Big News: C
Lawmakers, voters, and journalists continue to debate financial reform, especially in the context of what could happen to our internationally exposed banks if Europe starts to crumble. Most of the changes from Dodd-Frank financial reform didn't begin until this year, and some banks have said that their layoffs are a direct result of new regulations. That's caused a stir. But it's still too early to tell what impact Dodd-Frank has had on the financial industry as analysts seem torn on whether it's doing too much or too little to make our banking system as safe and efficient as possible.