The Water Crisis in the American Southwest

The American Southwest is primed to be one of the largest beneficiaries of the changes caused by deglobalization – mainly the reshoring of manufacturing. They owe this to years of in-migration bolstering their demographics. They also account for a significant portion of the nation’s foodstuffs. However, everything in the American Southwest depends upon one thing…WATER.

To put it lightly, the water situation in the Southwest is fickle; rivers can go from rushing to bone dry in a matter of a year. Up to this point, the Colorado River Compact has been the saving grace for the Southwest: a treaty outlining how much water from the Colorado River will be allocated to each state in the region.

The issue with the compact is that it operates on a priority system. So states that were urbanized when the treaty was signed have priority over states that developed later on. Fast forward to today, and we have an archaic system that benefits places like California over places like Arizona.

So what happens if the states upstream decide to walk away from the compact and start using the water as they see fit? It would be an ugly few years of political and legal chaos, but if the Southwest wants to be the beneficiary it’s poised to be…they better figure it out quickly.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hey everybody. Peter Zeihan here coming to you from Vegas. And today we are going to talk about water and drought and all the things that come from that. Specifically here in the American southwest, we have a water problem. Now, for those of you who know your paleontological history. That’s a mouthful. You will know that the Southwest has a history of mass extinction and civilizational breakdown events that have on time descended into cannibalism. The issue is the terrain. It’s an arid area with a lot of elevation, and that means that most of its water comes from orographic precipitation, which is a fancy term that says that when you get moisture moving across a landscape, if it hits an elevation center or a mountain, it will rise. And if the temperature at the higher elevations is cold enough, the water will condense into vapor form clouds and then rain. And most of the rainfall that hits the American southwest has that sort of origin. The problem with orographic precipitation, though, is it’s fickle. And oftentimes you will not get enough cold temperatures at elevation or not sufficiently humid air currents in order to generate the moisture in the first place. So rivers literally come and go and that is caused the collapse of civilisational systems as you get mega droughts from time to time to time. We are in one of those periods now. So that’s probably one.

Problem Two, when the American Southwest realized that they had limited amounts of water. The states back in the 1920s, 1922, I think, set up a legal structure called the Colorado River Compact, in which they agreed to share the water. The problem was that the year that they used to evaluate how much water they had to share was one of the wettest years on record. So we’ve known for decades that in time the volumes that were written out in the treaty just weren’t going to be there. In addition, this is all heavily litigated and legalized, all written down in law. And at the federal level, it’s an issue of senior water rights. So the urban centers that existed at the time of the treaty in 1922 have priority. And anyone who has built infrastructure since then to tap into the waterway network is at a lower priority. So if you were an urban center in 1922, you have senior water rights and everyone else who has added is lower and lower and lower and lower. And so if you were at the very bottom in, say, the seventies when your system was built, you’re at the very, very bottom. The first state mentioned in the compact is the one that had the highest population then and now, and that’s California. But Los Angeles has 15 million people. The entire Southwest only had that many people in 1922. So you can see as part of the problem, the last state to build out its infrastructure to tap the waterway network was Arizona. It only finished the the Central Arizona project in the late sixties and into the seventies. So they’re at the very bottom. And when there was a dispute over water a few years ago, Arizona and California ended up in court. And the Supreme Court ruled very, very clearly that California has severe water rights and Arizona is at the bottom of the stack of junior water rights, which means that Arizona water demand can go to zero before California has to cut at all. And with that ruling in California’s back pocket, California has simply refused to engage in negotiations with the other states of the Colorado River basin. So we even had a deal last year where all of the other states got together and agreed to slash their demand. If, in exchange, California were to make a moderate decline. And California refused. The California position officially is you all go to zero and die and we will just keep having our golf courses.

So the debate now among the other states, especially the upstream states, is about just walking away from the compact completely. Now, this would lead to California suing them in a court case that they would probably lose, but that would take years because it would get tied up in court. And in the meantime, California would go completely dry. And Southern California gets roughly a third of their water from the Colorado River. So massive economic dislocation. Now, aside from the whole human tragedy of this, why does this matter? Well, let me give you three reasons. Number one, the world is deglobalizing and the United States is discovering if it still wants stuff, it needs to build out its own industrial plant. So there is a competition among the states right now about where that stuff will go. Texas is probably going to be the single biggest winner of the American South. Looks really good. But there’s parts of the Southwest that are very, very high value added. And getting semiconductor fabrication facilities in places like Phoenix are a great idea. But it requires water. In addition, we need to reshore especially the electronic supply chain system. And the Southwest is probably the best part of the country for that for labor reasons. In order to do manufacturing of electronics, you need a differentiated workforce with a lot of different price points. That means the person who does the lens for the camera is not the person who does the memory board, is not the person who does the plastic molding, is not the person who does assembly. These are all different skill sets. They all have different price points for the labor. And so you need multiple skill sets, multiple price points, multiple labor forces in relatively close proximity. This is one of the reasons that East Asia has done so well in this space for decades, because you have your technocracy in Korea and Japan and Taiwan, you have your mass assembly in places like Vietnam and China, and then you have your mid-range in places like Malaysia and Thailand. The only place in North America we have that sort of variation is in the US-Mexico border. And for the Southwest that’s a really good selling point if you can keep the water flowing. And another big reason is agriculture. Now, one of the big problems, one of the reasons why the Southwest is in this problem is that they are growing a lot of food in the desert. And, you know, if you look at that on its surface, you’ve got to wonder if that was a very good idea in the first place. And the answer is no, it was not a very good idea in the first place, but it is now part of our food security system. And so places like Yuma, Arizona, which are about as far south in the country as you can get, get all of their water from these water courses that are governed by the compact and of Colorado just walks away. Then in the winter, we’re talking about losing a quarter to a third of most of her fresh vegetables because it’s got the perfect climate for it if you got the water. Now, unlike, say, interior Washington, where you’ve got the Columbia River, which is the continent’s biggest water flow by volume, and you take water from that for, say, the Yakima and the Walla Walla, the Benson systems. You know, it’s not a big deal, but you can’t do that at scale over time in a watershed like we have in the Southwest. And so we’re talking about losing a significant amount of food production that is important, not just locally and regionally, but across the national system.

Now, California don’t get too smug. The Central Valley is facing this exact same problem, and you can’t blame that one on any one upstate. That is your homegrown ecological and agricultural crisis. That’s a problem for another day. And then third, taxes. One of the things that we’ve seen in the last few years is Americans are moving in a way that they haven’t in quite some time. The baby boomers want to move someplace where it’s warmer. The millennials want to move to someplace that has more elbow room where it’s cheaper to expand the cities and therefore they can afford yards. And not a lot of people want to be dependent on mass transport because they’re afraid of diseases. Well, the American Southwest scratches all of those itches. And it has been the fastest growing part of the country from in-migration in the country now for roughly 50 years. And all else being equal, there’s not a lot of reason to expect that to change unless there’s a persistent water crisis.

Now, the good news is there are a lot of things that America can do in order to get by a lot better. You remove a lot of the water intensive agriculture from the region. You make things like golf courses go away. You don’t have fountains in Phoenix, for example, and you just manage your water resources with the best technologies of the 13th century, we can probably have a population increase of 50% without a problem.

But above all, the Colorado Compact has to be renegotiated for a more realistic environment. And since California will not choose to do that willingly, they are going to have to be forced, which means either we do have a crisis first triggered by the upstream states or Congress steps in and abrogates the pact and imposes a replacement. This is going to be an ugly, ugly political issue for the next few years. That is absolutely unavoidable, but is absolutely critical if the United States in general, this region in specific, is going to take advantage of the demographic and geopolitical shifts that are wracking our world right now. This region should be one of the biggest beneficiaries of the changes going on, but they have to be able to get the water situation right.

Alright. That’s it for me. See you guys next time.

Dire Straits: Energy in Europe

Horrible views today up on the Isthmus Peak Trail in New Zealand.

Europe’s energy situation looked pretty dire last year as concerns began to mount over the impending winter season. Thankfully they dodged a bullet this year, but how many more bullets can the Europeans dodge?

The issue with Europe’s lucky streak is that none of what saved them can be replicated. Industrial demand has already plummeted, and maintaining these levels would have detrimental effects. Paying through their teeth for liquified natural gas isn’t sustainable. And unless the Europeans have Mother Nature on speed dial, they can’t expect another moderate winter like this year.

Unfortunately for all of us, current global energy supplies are likely the best they’ll be for years to come. So the Europeans need to say thanks for the extra time and head back to the drawing board to get out of this pickle.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hey everyone. Peter Zeihan here coming to you from New Zealand on the Isthmus Peak Trail just came down off the summit where it was a breezy, negative five degrees centigrade, complete with. What was that called again – grapple – grappling. And when that was no fun at all. Anyway, we found a nice spot with a backdrop here. I want to talk to you about what’s going on with energy in Europe now in the aftermath of the Ukraine war.

We all know that between damage to pipelines and boycotts and shut offs on the Russian side and war damage that the Europeans are using, a lot less natural gas from Russia. And Russia was their primary supplier providing the continent with about a quarter of the total natural gas. And in the case of Germany, specifically, over 40% coming from a single pipeline.

Now, for those of you who’ve been following me for a year, you know that I was really concerned that over the winter, natural gas was going to just not be available. Because if you look at historical trends when it comes to storage and pricing and usage…it looked pretty dire? And in fact, in the aftermath of Nord Stream being blown off back in September, we saw natural gas prices go up by a factor of five, six, seven. And at one point they were about $70 per thousand cubic feet. Apologies for those of you who speak metric. Most of my audience is American, blah blah blah. Anyway, but over the winter, prices have plummeted to historic lows.

Now three things have happened that have enabled that to occur and to prevent just a complete meltdown in Europe or freeze up, I guess.

Number one, the Europeans, especially the Germans, shut down most industrial demand. So they just stopped smelting aluminum and steel and stopped fabricating petrochemicals and fertilizers. That is something you can sustain, but only at the cost of absolutely massive damage to your economic system. This is more of a problem for Germany than the rest. I mean, it’s a problem for everybody. But for the Germans, the petrochemical systems that they use are fueled by natural gas and those petrochemical outputs then go to the base materials for their manufacturing sector. So by shutting this stuff down, they are now dependent upon intermediate products that come from a continent away which are not nearly as reliable and are much higher cost. So the capacity, the profitability, the sustainability of the entire German industrial model is now in severe doubt. And in the best case scenario, the Germans probably only have about two years left that they can operate like this, assuming nothing else goes wrong.

Second, the Europeans paid five, six, seven, eight, nine times the prices that they were paying before in order to tap natural gas and liquefied form. Now, natural gas is kind of hard to move. It’s a gas. You have to have a pipeline system that links production to transport, to distribution, to usage all at the same time, because storage is relatively expensive. And the Europeans were obviously dependent on the Russians for that. But if you have a lot of extra infrastructure here, you can at a point of export near a point of production. You can chill the stuff down, basically with a giant freezer tied -300 odd degrees and make natural gas an actual liquid and then ship the liquid like you would any other liquid, although specialized tanker. And then once you get it to the end destination and you can warm it back up, gassify and pump into your system per normal. And Europeans tapped the global market for that at a scale we have never seen the Europeans do before, and they paid through the teeth to do that. LNG on average costs about triple what the gas cost because of the costs of cooling and in transport and regasification. Excuse me, but it was either that or not have power. So the Europeans generally did that and that triggered a series of energy problems all around the world, especially in countries like Japan and Korea and Taiwan, who normally rely on LNG as their primary source of energy. So that was the second thing.

The third thing is they got really lucky. Temperatures for the last nine, ten weeks across all of Europe have been 20 to 30 degrees above historical average. It has been the warmest winter on record. And in that sort of environment, demand for natural gas, for heating just hasn’t been as robust as it normally is.

Now, the problem for the Europeans is none of these things are really replicable. I mean, you can’t count on Mother Nature being that nice. More than one year in a row. The Russian supplies that are piped aren’t coming back this summer, which is normally when the Europeans would refill their stocks. So the only way that they can refill them is to go back to the international market and tap even more LNG. But it takes 5 to 7 years to build an LNG liquefaction facility. So global supplies are as good as they’re going to get for the appreciable future and they could keep all of their industry offline in order to reduce demand. That might be their only option, but that comes as a critical economic cost over the long term, not just in terms of competitiveness, but the very existence of some of these heavy manufacturing sectors.

So no good solutions. The Europeans dodged several bullets this year, and they should consider themselves very, very lucky. But we are only at the beginning of a multi-year transition to what is next. And the Europeans were simply fortunate that they have a little bit more time to work on other things.

Oh, yeah. One more thing that helped the Europeans out. If you remember back to November, December and January, that’s when the Chinese were imploding over COVID. We still don’t have good numbers, but assuming that the COVID strain that the Chinese were dealing with matches what the anti-vaxxers in the United States suggested was the actual authority rate for COVID. They lost a million people. And in that period, economic activity basically crashed. So for roughly three months, the Chinese were not importing a lot of liquefied natural gas themselves. At the same time, the Europeans desperately needed whatever molecules they could get. So we had a three month period where natural gas prices globally in the liquefied market was just weird and it benefited the Europeans the most you could possibly imagine…DONE.

They’re Watching You: The TikTok Ban

The CCP is always watching…and no, I’m not talking about spy balloons today. Under the law in China, any company must cooperate with the government. So if you’ve got TikTok on your phone, you may want to watch your back.

However, there is an even scarier company out there, and it’s called META. Both companies collect the same data, but Zuckerberg takes this a step further. Your data is bundled, segmented, and sold to scammers as “Likely to fall for XYZ scam.”

The potential restrictions on TikTok are only the beginning of what I see as a necessary move toward protecting our personal information and data.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hi Peter Zeihan here coming to you from Crown Point Overlook in New Zealand, just outside of Queenstown. The news that I’ve been following of late has to do with TikTok and everyone talking about how it is this government spy program and it needs to be banned. For those of you in what pretty for a while, you know, I’m a relatively laissez faire kind of guy for most things, but there are exceptions and this is absolutely one. Under law in China, any company, not an information company, not an Internet company, not a social media company, ANY company has to cooperate with their intelligence services for any reason at any time, in whatever way the Chinese government requires. So technically, every Chinese company is a security risk, especially one that you put on your phone. And with the technology as it currently exists with TikTok, even if you have the app closed, it’s recording everything you do, bank account information, your cell phone calls, everything. And what happens is the Chinese government, if they have an interest in you, they will go into tick tock and say, I want information about this person in this area, these keywords, that sort of thing.

They have to make a very specific request to go into the data and pull it and TikTok is legally required to cooperate and hand over all the information. So from a security point of view, absolutely TikTok is a threat, but there is a company out there that is at least an order of magnitude worse than TikTok and it is called Facebook because they collect data in exactly the same way. It’s just as invasive. But unlike TikTok, where the Chinese government has to then come in to go after you. Facebook does the work for them and they take all of their data from their billion plus users and they break them up into chunks of 10,000 based on what sort of fraud they think (Facebook thinks) you will fall for a religious scam, an anti-vaxxer or scam, a give money to the elderly scam, a save the children scam, whatever it happens to be. And then they take these packets of 10,000 and they go to a place in Vegas every year where the scammers get together for literal conventions and they market your data, they market your data to these entities. And of course, the Chinese government shows up for that. So does the Russian government. So the only way to be safe from these two apps is not simply to delete it off of your phone, but then to go through and do a full system reboot and purge. Because even if you have signed out of TikTok or Facebook, it is still collecting the data you actually have to delete the entire thing after signing out. Its the only way to get around it. 

So the restrictions on TikTok, I think they’re a great idea and I think they’re only the beginning of what we need to do to get our social media space back. Alright. OOOP weather just turned. We got to go. You guys take care.

Demographics Part 9: The Advanced Developing World

The advanced developing world is about to have its moment. We’re talking about India, Turkey, Indonesia, Vietnam, and Brazil. These countries were a little late to the global scene, but now it’s their time to shine, hopefully…

The path to globalization is well-traveled, but that doesn’t mean its obstacle-free. These countries will have to work hard to balance their shifting demographics with changes to their economic structures and movement along the value-add chain.

For a country like Brazil, their current trajectory could very likely send them into a crippling demographic situation with no way to pull themselves out. If a country like Turkey continues to move up the value-add chain steadily, I could see them flourishing in the coming years.

These countries are not facing a terminal demographic situation quite yet, but if history has taught us anything…now is the time for them to reconcile their declining demographics and prepare for what comes next.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hey Everybody. Peter Zeihan coming to you from Colorado. I am in training for my upcoming New Zealand trip and so I wanted to record a couple of videos that would last a little bit longer. So this is the most recent installment in our demographic series. And today we’re going to talk about the advanced developing world, a group of countries that includes India, Turkey, Indonesia, to a lesser degree Vietnam, certainly Brazil.

These countries have a lot of things in common, not just in terms of their demographic structure, but their economic history. So until World War Two, these were all either colonies or kind of isolated systems. And they had that traditional, pre developed world pyramidal structure that was very high consumption, high inflationary and relatively low value added. But even in the early decades of the post-World War Two era, they didn’t really join into the Bretton Woods free trade system, even though some of them, several of them were signatories to the pact. They kept their economies to themselves for nationalistic reasons. And to be perfectly blunt, there was a fair amount of the advanced world, most notably Europe, where even though global trade was available, they really didn’t globalized their supply chains. They were export products, but they tried to not become dependent upon anybody else in terms of the production cycle. Well, you play that forward until 1992. And what changed in 1992 is, of course, the Cold War ended. And that’s meant that a lot of the strictures that had made it difficult to do things went away. And these countries came in from the cold from a little bit a second in 1992, the Europeans signed the Treaty of Mashhad, which did away with a lot of the internal tariff and non-tariff barriers that existed within the European space. And that meant that the Europeans started to integrate and especially German supply chains started to link to the rest of Europe over the course of the next 20 years. That was extended first as economic links and later as full EU membership to all of the states of Central Europe, from Estonia down to Bulgaria, with Poland being the most important one. And that meant that the European space, or if you want to be honest, the German economy became suddenly this global powerhouse and started exporting products that were a lot more value added from a lot more product sectors. But most importantly, of course, 1979 was the year that the Chinese started to tiptoe into the international system and then really join in in the 1990s and 2000s, which meant that the Chinese were ravenous for raw commodities and would pay pretty much anything to get whatever they needed.

This all benefited the advanced countries of the developed world because they could get certain products from the Germans and the Chinese that they could make at home, and then they could work on either raw materials or manufacturing to fill in the niches that the bigger economies didn’t provide. So for most of this class of country, 1990 really was the break point where they started to urbanize and industrialize. It took the combination of not just the global trading system, but also a change in the way that other major economies viewed economics. In the case of Mexico. 1992 is when after was adopted and of course, the early 1990s when the WTO came into existence.

So what this means is that these countries started this rapid process not in the forties or fifties, like, say, the Koreans or the Japanese or the Europeans, but not until the 1990s. But by that point, the process of developing and industrializing and urbanizing was kind of old hat for a lot of the world. So these countries were able to proceed down that path a lot faster than the countries that have come before. So for the Brits, it took seven centuries. For the Germans, closer to five. For the Americans…America’s a special case, let’s leave them out. For the Spanish, it really only took 2 to 3. These countries have done it in really one, one and a half to two. And as a result, starting in the 1990s, their birthrates plummeted, in most cases dropping by half to two thirds. So if you look at the population structure of their demographics, it’s a pure a pyramid for people who are above about age 35 and then it goes straight down in a column. Now, this is hardly a disaster. By having fewer children, more money can be focused on education, on infrastructure, general business investment. And so all of these countries have been moving bit by bit up the value added scale. We’ll look at Mexico from a value add point of view, comparing the value of the inputs versus the value of the exports. It’s probably the most high value added economy in the world. So, you know, no slouches in any of these categories.

But this has some consequences because if this continues, these countries are going to age at a much faster rate than the countries that preceded them. So, you know, we’re talking about these countries reaching a mass impact in really under 20 years. And in the case of the United States, as a point of comparison, the U.S. is going to be a younger country, demographically speaking, on average, than Brazil in the early 2040s in Mexico and Indonesia are going to pass by us in the early 2050s and probably even India by 2060.

Now there’s a lot of history to be written between here and there, but these countries all have a demographic moment and if they take advantage of it, to become developed by moving up the value added chain very, very rapidly, kind of like Mexico is, then by the time they get to these points, they will be developed enough to deal with those sort of demographic consequences. But if they become stuck in the middle, which is definitely what seems to be happening with Brazil, they’re going to have some real problems because they’ll have gotten old without becoming developed.

The case of Brazil is a special one and it’s almost entirely because of China. The Chinese came in under President Lula, his first term, and they signed a number of deals to build joint ventures for producing products in Brazil. But the Chinese basically lied and stole all the technology from all the Brazilian firms and then took it back home, produces in mass and basically drove all the Brazilian companies out of the global market. So the Brazilian industry now only basically services the Brazilian system. Indonesia has not fallen prey to that because they didn’t have the technological aptitude in the first place. They’re trying to move up the value added scale, getting out of raw commodities into processing and ultimately into things like battery assembly, which is overall a pretty good plan, inconvenient for the rest of the world, who is trying to go green quickly, but definitely in Indonesia’s best interests. Mexico is definitely the furthest along overall and moving up the value added scale. And in terms of labor productivity, I’d argue they’re above Canada already. Who am I leaving out? Turkey? The Europeans have integrated with Turkey to kind of be the Mexico for Europe. And Turkey began with a much more sophisticated labor force and infrastructure than the Mexicans had in the 1990s. They haven’t moved as fast, but you have a much deeper penetration of these technologies in these skills throughout the Turkish system than in any other countries in this class. So if the Europeans were to vanish tomorrow, the Turks would obviously feel it. But they definitely remain the most powerful country in the neighborhood, and their demographics are young enough and their neighbors are even younger that I could see a Turkish manufacturing system really taking off. Obviously, this isn’t Germany would be the same quality, quality of product, but would still be a pretty good result anyway.

Bottom line of all of this is that these countries all had a moment, the historical moment that is approximately as long as the one we’ve just completed with the hyper globalization of the post-World War Two era. But it is still only a moment, and they all need to really buckle up and get down to business if they want to do well in what comes next.

All right. That’s it for me today. See you guys next time.

Russia Moves Nukes to Belarus

Today’s video comes to you from the shores of Lake Hawea with the famed Dingle Burn arm behind me.

Anytime Russia and nukes are mentioned in the same sentence…the world pays attention. But does moving your nukes to a new place inherently change your military posture?

In the case of Belarus, the answer is no. Russia already has nukes in Kaliningrad (further west than Belarus), so this isn’t “expanding” Putin’s military reach. Additionally, the Belarusian infrastructure sucks, so these nukes will likely sit around and collect dust (unless they’re sold on the open market, but that’s an entirely different conversation).

So what does moving Russian nukes to Belarus accomplish? Putin gets to bang on his chest a little, rally up the domestic nationalism machine, and ensure the internal political situation is still propping him up. As for international security issues, this doesn’t move the needle…at least for now.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Everybody. Peter Zeihan here coming to you from the shores of Lake Hawea with the famed Dingle Burn arm behind me. This is my favorite lake in New Zealand for the obvious reasons. And today we’re talking about Russia and nukes. So for those of you who have, you know, not been under a rock, the Russians have been threatening nuclear, this and that and everything since the Ukraine war started. But if you look back and look at the statements, you’ll know that sometime in mid-March of last year, Putin stopped making threats. And it was only in the last couple of weeks that the Russians have said they’re moving nukes up to a permanent station in Belarus, which is the first expansion of the Russian military footprint in terms of nuclear arms since the end of the Cold War. A lot of people are worried about that. But I think it’s best to look back before we look forward.

So if you remember back to February and early March, Putin was making nuclear threats against anyone who was willing to support the Ukrainians in any way. And then he just stopped. And the way it was explained to me the last time I was in Washington, went something like this this – the ambassador was dispatched to talk to Putin and to lay out a little bit of logic. And the idea was that if you look back to February and March, especially in January, when the Russians would have a super secret meeting with the National Security Council, the locked room, and then within hours, the transcript of those conversations would be published in Western media. The way the ambassador explained it to Putin was that the Americans have been listening to everything every phone call, every conversation, reading, every email, and in doing so, had a full picture of everything that Putin was personally considering and within his inner circle. And the idea was that, you know, a minor detail of this sort of espionage was that the United States knew at any given time physically where Putin was. So if he thought he could fling a nuke into the Western Hemisphere in the first couple, wouldn’t just come back and come right down his throat. He was kind of out of his mind. So he stopped making the threats and he left it to his henchmen to do it. This new development is kind of in the same vein.

Putting nukes in a place doesn’t in of itself change your military posture. And we know from some of the nuclear threats that the Russians made back in last March and April and May is that they didn’t actually change their readiness. They were just shouting. This is kind of like that. Because if you put a nuke in another country, you need a hardened facility, you need a command and control system, you need a night system that is absolutely hack proof. And putting that in Belarus, Belarus barely has electricity on a good day. It’s a horrible place for a nuclear race. So if the Russians did transfer nukes there, they basically would be sitting in crates surrounded by soldiers unable to be launched. So at this point and this specific issue, the nuclear threat coming out of Russia has not actually increased. The potential risk we have here is proliferation, because we know that the Russians don’t have the best security and we know that the military has become really corrupt, especially when it comes to hardware and funding. So taking secure nuclear materials and transferring them to a country that’s a kleptocracy like Belarus actually raises the chance that these things might get sold on the open market. It’s not that that’s a non risk, but it’s a very, very different risk from the idea of the Russians actually physically expanding their nuclear deployment footprint. But in terms of operational readiness, there’s really no change because the Russians already have a nuclear footprint in their little enclave of Kaliningrad on the Baltic Sea, which is west of Belarus.

So nothing has really changed here. The Russians are just looking for a little way to beat their chests and kind of feed the domestic nationalism machine that is keeping the government in power. This is about internal Russian politics, not international security issues, at least for now. Alright. That’s it for me. Talk to you guys later.

Macron Tries to Reason with a Failing China

Today’s video is coming to you from Charteris Bay, New Zealand.

The week’s major news is that French President Macron is trying to bring Chinese President Xi to his senses. As Macron urges Xi to drop his support of Putin and the Russian war on Ukraine, we need to see why this conversation is even happening.

Russians like to blame the Americans for their shortcomings, and while this may have held some truth in the years following the Cold War, just about every country out there has an anti-Russian policy. The Chinese have jumped on the bandwagon and want to blame the US for their issues, but now most countries have developed their own anti-Chinese policies.

As the US steps back as the world’s police, these countries’ policies will play an even bigger part in the international space. While countries like the US and France may still operate as partners, each will put its own interests first. And countries like Japan, Taiwan, Vietnam, Australia, and India can even shape how China interacts with the rest of the world.

So what does all of this mean? China is simultaneously dealing with a multi-vectored opposition and mounting internal struggles. Between impending demographic collapse, single-pronged politics, and a crumbling financial system, the world can sit back and watch the Chinese system implode.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Everybody. Peter Zeihan here coming to you from Charteris Bay on the South Island of New Zealand, just outside of Christchurch. This is going to be one of my last recordings from New Zealand, but these are all being released out of order based on current events. So you’re going to see a little bit more of this gem that I used to call home in the weeks to come.

Anyway, the big issue from this last week, from my opinion, was that French President Macron has been visiting China to have talks with chairman is using ping and to try to talk him out of some of his degree of support for what’s going on in the Russian invasion of Ukraine. Now, Chinese media has been blaring about what a wonderful summit this is and France’s idea of strategic independence, the idea that France, specifically in Europe in general, don’t have to follow the cue of the United States.

They’ve been really hitting that hard. And it kind of shows the degree of political disintegration within China has now even reached the diplomatic core. Let me unpack that a little bit. So one of the things that the Russians have always believed that the Chinese are now starting to say that they believe is that behind every plot and every downside and every setback that Moscow and Beijing have ever experienced is the American hand and that the Americans have been orchestrating and creating this alliance in order to contain and beat them back.

And during the Cold War, there was definitely something to that, because the policy really was containment. And in the aftermath of World War Two, all of the traditional powers that had bordered, the Soviets were broken in one way or the other. So the United States physically reconstructed them, provided them with economic aid, created a global system that allowed them to trade and access energy and markets.

And as a result, the United States received the authority to set their security policies. And while that certainly did contain and ultimately beat back the Soviet Union, it also gave the Soviets a lot of space. Because if you look at the time before 1945, the Soviets were dealing with a couple of dozen major countries, all of which had their own interests and all of them which viewed Russia as a mortal threat.

So whether it was Finland or Sweden or Norway or Denmark or Poland or Germany or France or Turkey or Japan, each of these independent countries had their own anti-Russia strategy. And one of the reasons why the Russians are so hosed now is a lot of these countries are coming back into their own because we are entering a post-American world.

Yes, the United States is, to a degree, riding a herd on what’s left of the alliance structure. But because the United States is a military structure has shifted now, because it’s now super carrier focused as opposed to having hundreds of ships, it can be everywhere at once. The United States just physically can’t be there at any given time.

And in the aftermath of the war on terror and the Iraq conflict, the United States isn’t going to be deploying land troops on a global basis for a very long time, if ever again. That leaves it to these independent countries to look after their own policy sets. And they have, historically speaking, been far more incisive, using far more invective and far more subtle and far more disruptive and far more subversive than anything the United States has ever done.

Yes, the United States is has been and will remain the single most powerful player, but it’s not the only one. And because of the nature of American foreign policy making, where you’ve got the president and the secretary of state and the national security adviser, and that’s about it. That’s the decision makers. The U.S. really has a hard time focusing on more than two or three things at a time, whereas if you’re in, say, France, you can focus on issues closer to the horizon with more intensive ness.

And so the Chinese inability to make this distinction means that they’re preparing for a world where the United States is riding herd in an alliance that doesn’t exist. And that means everything else is going to be able to come through the crap, because anyone who has studied French policy knows that the French are wildly creative at causing problems for countries they don’t like, for whatever reason.

So are the French and the Americans going to operate side by side with no light between them? No. The partners were friends to a degree. We’re even family, but we don’t always see the things through the same light. And yes, Washington does find that annoying from time to time as the French, from our point of view, go off.

But the French are doing things for the French and they’re not for certainly not doing it for the Chinese or the Russians. So that’s kind of piece. One piece to is look at the array of countries that are going to be doing this. The French are actually a minor power in the East Asian sphere. I would be far more concerned about countries like Japan, which has the world’s second largest blue water navy, who has the capacity of shutting down the sea lanes that go to and from China without help from the United States.

I’d be worried about the Taiwanese because, well, militarily, they’re not going to conquer the mainland anytime soon. They still have the intelligence apparatus operating within China already. This is the only thing that they care about because a significant amount of harm and disruption and of course, gather information for others and worry about Vietnam, which has a coastline on the South China Sea that’s over a thousand miles long.

But the Chinese have to sail down. The Vietnamese don’t even need a navy to disrupt Chinese commerce. I’d worry about Australia, which is in the process of building nuclear submarines and more importantly, mid-range air launched cruise missiles, which could disrupt everything the Chinese can do. I would worry about India, who doesn’t even have to leave home in order to completely wreck the Chinese economy.

None of these countries, with the possible exception of Australia, really operate as deputies of the United States. All of them are creative. All of them have their own capacities and all of them have their own reasons for tearing down the Chinese system in its current form. China is dealing with a multitude vectored opposition of countries that can think for themselves and act for themselves.

Now, why would the Chinese let them fall into this trap? I mean, this really is Soviet style groupthink in play here. Are the Chinese smart or don’t they think three steps ahead, aren’t they the chess players while the Americans are the checkers players? Yeah, that’s a bunch of bullshit. About seven or eight years ago, the cult of personality forming up in China reached the point of no return, and it started taking the official form of something called Jinping thought.

And that sounds a little bit groupthink ish. It’s because it is. The idea is not only do we have a party ideology, we have one dude who’s setting our goal, setting the process that we use to think and evaluate everything. And we need to all think like him. So in his first five years as Premier, she purged the party of everyone who was an alternate power center against him.

And in the second five years, he went against anyone who has any independent decision making at all. So there’s no one left. It’s just him and his little form of groupthink is now all that is left. So Chinese diplomacy, Chinese defense planning used to be multifactor. They used to have a good intelligence system. They used to have a good propaganda system.

But over the course of the last few years that has dissolved completely and all that is left is this monochromatic thought process that is fixated on a story that is wildly inaccurate, and that is what guides all Chinese decision making now. For those of you been following for me for a while, you know, I think that the demographic situation in China is far passed terminal.

It’s a country killer, you know that. I think the financial system is far passed terminal and that’s a country killer. And now we have a race with political incompetence as to what is actually going to kill the country first. Now and the long view of history. It doesn’t really matter if you’re killed by the car wreck falling off of a cliff or heart disease.

But for playing up the history in the here and now for the next several years, it really will matter. And if it’s policy incompetence that really leads China to its end. The impact on the Chinese population will be particular, really horrific because this is a country that is dependent upon international connections, not just for its economic wear for all, but for its energy and its food supplies.

And the last time we had that sort of break, it was another period where an individual on the Chinese system impressed his version of ideology into everyone’s thinking and that was Mao Zedong thought. And that led to the Cultural Revolution, the great leap forward and the death of tens of millions of his own countrymen from famine and political purges.

We are entering the situation where that’s one of the better scenarios for China for the next decade or two. All right. You all take care. See you next time.

Taiwan Loses Honduran Support to China

Today’s rainbow is brought to you by Wanaka, New Zealand.

For those following Chinese relations, you’ve probably heard that Honduras just dropped its recognition of Taiwan to establish ties with mainland China. President Tsai responded with a trip to Central America to shore up diplomatic support, but will any of this determine the status of relations between Taiwan, China, and the rest of the world?

While all this makes for good theater, all that matters is where the money and weapons go. And the country to watch is the US.


Taiwan and US trade negotiations are already underway and will likely be wrapped up here soon. Once they’ve reached an agreement and Taiwan becomes a fully integrated trade partner, they’ll be treated as an independent country in every capacity but name.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hey Everyone. Peter Zeihan here coming to you from Wanaka, New Zealand, which is just a place too beautiful really for words. I mean, look at this. This is the full arch. It’s just stupid. 

Anyway, for those of you who have been following Chinese relations, you know that the Chinese have been able to convince the country of Honduras to switch the recognition from Taiwan to Beijing. And as a result, the president of Taiwan, President Tsai, is on her way to do a Central American tour to try to shore up the diplomatic support for the remaining handful of countries that still recognize Taiwan as the rightful representative of the Chinese people. Ultimately, this is a lot of theater. Taiwan’s a small country. China is huge. And when it comes down to a battle of the pocketbooks, obviously Taiwan is going to lose.

But honestly, that is not what is going to decide the status of relations between the island of the mainland and the island in the rest of the world. That is dependent upon the actual policies as opposed to things like recognition, but actually where you’re putting your money and your weapons with much larger countries. And of course, the country that is always going to matter the most in that is the United States. And the United States has begun free trade negotiations with the Taiwanese. That will probably wrap up within a year, at which point treating Taiwan as an independent country will not simply be core to American bipartisan foreign policy, but a core to domestic economic and trade policy as well. And when that happens, it really doesn’t matter what the du jour system is for recognizing Taiwan as an independent country or not, because it will be a fully fledged integrated system in American law. And once that happens, the degree to which the United States can take action and promote military ties is going to be just like it will be for any other country. And we will have recognition by the United States of Taiwan as an independent country in everything that matters except for name. And undoing that is something that would require an American president to do something that is starkly against what has been the building bipartisan consensus now for 15 years.

So we’re getting to full recognition. We’re getting there very quickly, and we’re not doing it by paper. We’re doing it with the rubber hitting the road. Anyway, that’s it for me on that topic. I’ll see you guys again soon.

Building the Anti-Russian Alliance

Today’s video comes to you from Doubtful Sound in Fiordland National Park.

The European space has historically been disconnected. Between geographical barriers, neutral countries, and bloody history, that shouldn’t come as a surprise. Now that central and western Europe is forming a coalition against the Russians…Putin should be shaking in his boots.

Much of core Europe has already made its stance clear, with German, Portuguese, and Spanish tanks arriving throughout the month. With NATO votes coming up, historically neutral countries like Finland and Sweden are making their alliances clear. And even Turkey can no longer straddle the line and play both sides of this ordeal.

The real kicker here is that the Americans aren’t steering the ship. This is the Europeans doing what’s best for the Europeans. We haven’t seen a coalition this large united against a single power for centuries, and the Russians are in for a rude awakening.

*At 3:50 in the video, Peter mentions that the “French are contributing (to the Ukraine War effort) in a way they haven’t done since WWII” – it’s important to note that the French had boots on the ground in both Desert Storm and Desert Shield

*At the time of posting Finland has already been added to NATO

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hey Everyone. Peter Zeihan here coming to you from Doubtful Sound in New Zealand’s Fiordland National Park. Anyway, a lot of things have gone down in the Ukraine space politically, not so much militarily. And I thought it was worth kind of looking at what the big picture is and to understand where we’re going forward, we have to go back. If you go to the world before 1945, the age of European competition, you had shifting alliances because the geography really prevented the area from coalescing into a single entity. So your northern plane, you’ve got the French, the Dutch, the Belgians, the Poles and the Germans who if you know, if there was ever going to be a zone where someone controlled everything, would be them. And so most chapters of history have been one of those powers trying to assert control over the others. You’ve got Scandinavian in the north with fjords and peninsulas and islands, so always fiercely independent and very naval oriented compared to everyone else. In the south you’ve got a more occluded coastline with very few navigable rivers of any type. And so you get regional powers who were relatively isolated from the others, but who could really punch above their weight economically because they’re all trade oriented, whether that’s in Spain or Portugal or Italy or the Balkans. It makes for a bit of a mess. And so for most of the half millennia leading up to 1945, it was kind of a war of all against all with shifting alliances here and there. Always changing texture, always changing sides. Then the Americans came in, in World War Two, and the Soviets rose during World War Two become major powers who injected themselves into this competition, encroaching into the rules of the game, because suddenly you had these two outside-ish powers who were determining all the major decisions. And we kind of forgot that Europe was the most blood soaked part of the planet until that point.

Now, with 1990 and the end of the Cold War, the Europeans have been living in a vacation from history where the security paradigms of the Cold War exist without the security threat of the Cold War. You combine that with the late globalization period and the time when pretty much all of the world was open for business and you got a very different sort of environment economically and especially politically. Well, the Russians now are kind of climbing back, clawing out of their post-Soviet hole and attempting to reassert themselves as a major regional power. Whether you believe they’re doing this out of stupid reasons or sane security reasons doesn’t really matter. They’re trying to change the nature of the system for their own long term benefit, and that is forcing countries to do something that they haven’t had to do for decades. Take a side, take a position and form an alliance to counter the Russians.

Now, from the Russian point of view, it’s all about the Americans all the time. And everything that’s going wrong for the Russian can be laid at the Americans feet. But that is to completely ignore the history of Europe, which is that of a series of independent and semi-independent primary secondary powers.

So what is kind of shaking out this week? Well, first and most importantly, the German leopard tanks, mainline battle tanks, have finally reached the war. And so now the Germans have fallen into this position of – we don’t want to be in a leadership position. We know what that has looked like in the past. We understand why everyone was nervous about it. Well, we don’t have a choice. We are the largest economic power in the northern European plain, the largest economic power in Europe. And historically speaking, we have also been the most powerful military force. We have to take a leadership position because if we don’t, this is all going to fall apart and we will be facing the Russians on the plains of Poland. And we know exactly where that leads. And we don’t want that.

This has a lot of depth because the Dutch also on the northern European plain are into the hilt. So are the Poles. The French are contributing in a way we haven’t seen the French contribute to multinational operations since World War Two and even further back technically off the plain in places like Spain and Portugal. Portugal tanks arrive with the German ones and the Spanish ones will be there within a month. So everyone in that kind of strip of what you think of as core Europe is already fully committed and back in the game. Scandinavia is a little bit different here. You’ve got mostly independent cities, states that masquerade as countries, and then Sweden, which has kind of been out of the game for three centuries. By the end of next week, Turkey will have voted on whether or not to let the Finns into NATO’s, and a vote on Sweden will probably go within a couple of months of that. And that means that these two traditionally neutral powers are going to be taking a leadership position in security policy in Europe. And the only issue they care about are the Russians. Now, the Swedes have been out of the game for three centuries after a massive military defeat in what is today’s Ukraine and in the aftermath of World War Two, the Finns were forced into a degree of neutrality where they could chart their own economic course. But on any sort of security decision making, the Soviets had full veto power. Well, that is now gone. And these two countries that have very strong militaries, relative to their size, economically or in terms of population, all of a sudden are the harbingers of the apocalypse when it comes to the Russian point of view of how European security should go, because they are extraordinarily anti-Russian. Every security question that they have ever faced has been framed in the context of what do we do the day the Russians invade? Everything else is around that, and now they’re about to be part of the decision making architecture. That also means that the Turks are coming in from the cold. They’ve been trying to kind of have their cake and eat it, too. But in the last few weeks, they’ve joined the sanctions regime relatively forthrightly and are now no longer an avenue that the Russians can use to evade the sanctions regime, especially when it comes to materials import things like semiconductors. And then finally, of course, there’s the United Kingdom. The United Kingdom was always going to be anti-Russian because it’s a naval power on an island. And any time it looks like a land power in Europe is going to become more potent. They get a little nervous and they want to make sure that the land powers are busy with land issues so they can’t float navies that can challenge London. Well, King Charles was just coronated in his first full state visit to Germany. If there are two countries in the European space that tend to be on opposite sides of all economic and security questions, it’s the United Kingdom and it’s Germany. And the fact that they’re, you know, within sight of one another is something that should turn anyone on the opposite side of that axis to turn the blood cold.

So what we’re seeing here for the first time, not in decades, but in centuries, is everyone in Central and Western Europe at the same time coming together to form a broad coalition against a single power. We haven’t had that since Napoleon, if you want to get technical, we haven’t had that since the Treaty of Westphalia. And the Americans, while they are a part of all of this, are not steering this part of the equation. This is the Europeans doing what makes sense to the Europeans. And if I were the Russians, I’d be very concerned about that.

Finland: NATO’s Newest Member

Today’s video comes to you from Mt. Cook National Park in New Zealand.

Finland got the green light and has officially become NATO’s newest member. While the Finns are breathing a sigh of relief, we must consider how this could change the scope of the war.

Finland and Russia have some history together. From the Winter War to Finlandization, the resulting baggage of this intertwined past delayed the Finns from joining NATO. Finland could operate independently from Russia for years, with the caveat of Moscow running all security decisions. Making NATO a big no-no.

However, Russia’s invasion of Ukraine has signaled to the Finns that this is a war for survival, which puts a bright red target on Finland’s back. Finland might not have removed that target by joining NATO, but it’s not quite as red as before. Now it’s Sweden’s turn…

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

The Winner of the 2024 US Presidential Election Is…

By the time you see this, I’ll already be on the other side of the world, so I figured it was the perfect opportunity to talk politics…specifically, who will walk away with the 2024 US Presidency.

This will piss everyone off, but the only way I see this election playing out is with another Biden v. Trump showdown. The cult following that Trump has garnered practically locked him in as the Republican nominee. And there’s really no one else that the Democratic Party is willing to let replace Biden. So get ready for a 2020 rematch.

Issues like age and vice presidents won’t move the needle on this election. To understand how this will shake out, we need to break down the voting behaviors of the Republicans, Democrats, and Independents. Most Democrats and Republicans vote within party lines, and a large majority of Independents always vote one way or another.

So this election really comes down to 10% of Independent voters who actually give a s*** about who wins. And based on the midterm turnout, Biden has all the numbers stacking up in his favor. All he has to do is stay alive and keep from drooling on stage, and he’s going to win the office for another four years.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

TRANSCIPT

Hey everybody. Peter Zeihan here coming to you from the San Francisco airport where I am getting ready to be going on my first real big boy vacation since COVID started, they’ve all kind of stacked up. So I figured as long as I was leaving the country and you weren’t going to see this until after I was on the other side of the international dateline, now would be a good time to talk about American politics and tell you who’s going to win the next presidential election.

Now, the person to understand, if you want to see how this election is going to play out is Bernie Sanders. Because I think most people in America agree that he’s a bit cuckoo and his ideas are crazy. And if you sit down and actually force him to go through the math, how some people have done, he will admit that the math doesn’t make sense and he’ll just raise taxes until it does. And if that raises the marginal tax rate to the point that it destroys everything, he has no problem with that. And people who support Bernie Sanders, once you walk them through that, will come to the same general realization. But they will not change their minds because they are committed to the cause. Put another way, Bernie Sanders is not a political leader. He’s a religious leader, and he has a cult following as a result. And so does Donald Trump. Now, what that means is somewhere between one quarter and one third of people who self-identify as Republicans don’t care what Trump does or what he says. I mean, hell, he could livestream the abortion of his trans lover and they would still support him, which means that if only three other people run against him for the Republican nomination, he’s going to win the way the Republican Party works when it comes to delegates, as is in most of the races, as long as you get one more vote than whoever comes in in second place, you walk away with every single delegate. So it’s really easy for someone to come in from the outside, just like Donald Trump did, because by most metrics, he’s not a conservative in the American sense, certainly not the Republican sense. But he was able to mobilize a group of people who had been left to the outside of the populace and has catapulted not just to the presidency, but to control the Republican Party as a result. So in the environment that we’re in now, since we already have another three people have declared for the presidency, it doesn’t matter if someone like Florida Governor DeSantis runs at this point. The vote is already sufficiently split that Donald Trump will walk away with the Republican nomination. That’s pretty much hardwired in at this point. So that’s the Republicans. 

So let’s talk about the Democrats. The Democrats select their candidates a little bit differently. They don’t have that winner take all mentality when it comes to the delegates. So if you get a number of strong candidates, they were going to break up the delegate count among them and it’s going to come down to the convention. And at the convention, there are a significant number of what they call superdelegates, which are people who are not representative of the primary, the caucus system, but instead represent kind of the party’s institution, which are primarily centrists. And the superdelegates came into play in the last presidential cycle when for a brief, shining, terrifying moment, it looked like Bernie Sanders might actually get the Democratic nominee. And since most centrist and center left Democrats were like, Oh, that would be disastrous by any number of manners. They all rallied together and used the party apparatus to make sure that Bernie did not get the nomination. And as a result, Biden was able to squeak through and then ultimately ran for president and ultimately gained the White House. Now, the centrists and the center left within the Democratic coalition have made the decision already that they’re not going through that again. And so if Bernie or more likely when Bernie decides to once again run for president, the centrists will swing into action to make sure it’s nipped in the bud as quickly as possible. In addition, the Democrats have always had a problem, I shouldn’t say always. The Democrats in the last 25 years have had a problem that it’s really hard for them to bring in fresh blood, because you’ve got these charismatic people at the top who are politically and maybe even economically powerful, who kind of suck all the oxygen out of the room and make it very difficult for young up and comers to make it into the system. Republicans don’t have that particular problem. And so you get a lot of people who are in their seventies, people like Biden, people like Pelosi, people like Schumer who dominate the scene. And there really isn’t a cadre of people below them. There is no deep bench. In that sort of environment, it’s really, really hard to get a primary system that runs on actual competitive candidates. You just get these freaks that come in from the outside, freaks like Bernie Sanders. Well, since the centrists have already decided what they’re going to do this time around, that means Biden is a shoo in to get the nomination, which puts us into a weird race. You get Republicans who are cult dedicated to Donald Trump and you’ve got Democrats who are willing to shut out everyone else so long as Biden doesn’t have a complete meltdown and start drooling effusively on stage, barring those two extreme events, we’re talking about a redux of the last election of Biden versus Trump.

And I don’t think that any of the things that people are talking about right now as having an impact on the election would really matter at all. So, for example, the age issue, I mean. Yes, yes, yes, yes. Biden is older than dirt by a wide margin and he would be the oldest president ever if he wins again. However, if Trump beats him, Trump would then be the oldest president ever. So the age issue is really a non condition for any voter who says it is. It may be a compacting factor, but since the runner up in this case is almost as old, it doesn’t play. And the same comes for replacing the vice presidency with somebody besides Kamala Harris. Has she risen to the occasion? No. Has she turned out to be a good VP, probably not by most measures. But replacing her isn’t going to really change anyone’s mind. Nobody votes for the vice president, so we’re left with Biden versus Trump. So the question then is who walks away with that? From my point of view, it’s pretty straightforward.

Roughly 20 to 25% of the electorate is either hardcore Republican or hardcore Democrat, and they might not like the candidate, but they’ll hold their nose and they’ll pull the lever on no vote for whoever their party’s candidate is. They are locked in. There’s no negotiating room there. Then you have another about 20% on each side that says they’re independent. But, like in 85% of races, they vote for either a Republican or a Democrat. So they’re really only independent. And they really they’re just subsidiaries of the left and the right in the American system. There’s not a lot of wiggle room there. There’s only 10% of the American electorate that is truly independent. And they’re wishy washy and they’re judgmental and they get buyer’s remorse. And the votes of this last 10% is the primary reason why in mid-terms, usually the party in power loses because they’re having buyer’s remorse. And I know this very, very clearly because I’m part of that 10%. We’re never happy with what we are and we’re not part of the decision making to determine what the candidates are. And so we get handed this pallet that we just don’t like but we have to make do with. And that usually manifests as us voting against whoever happens to be the guy in charge at the moment.

So that is how it normally runs. That’s how it’s always run. It’s how it ran until we got to the 2022 midterms, because in the 2022 midterms, almost exclusively, the independents were polled as not liking Joe Biden, particularly on economic affairs. They saw his continued governance as being against their own economic best interests, and yet they decisively sided with Democrats in all the races that really matter. And so for the most part, independents polled as not liking the Biden administration’s economic policies. And they saw a continuation of those policies as against their own personal economic interests, and yet they decisively voted against Republicans. Why? Well, it is not too hard to understand. A lot of this talk about what’s going on with the election system is real, but you have to look at it from the independents point of view to really understand if the Republican Party under Trump is able to change the electoral system in the way that they say they want to, then swing voters don’t matter anymore and independent voters don’t have a party. That’s the general election is the only way that they play in American democracy. And if you remove that, they are powerless. So the United States government under Democrats and Republicans has this interesting saying when it comes to democracy in the Middle East, we want one person, one vote, but not just one time. And if we go down the path of Donald Trump wants to, you know, that’s compromised. That and Donald Trump has made personal loyalty the predominant issue in any political system in which he touches, which brings us crap candidates like Oz or Walker who are very, very easy to vote against. And so from the point of view of the independents, the people who have decided the last seven general elections, there’s nothing to decide anymore.

And so it’s pretty safe to say that if the midterms were decided by independents who usually don’t even show up to midterms and they were willing to vote against what they see as their own economic best interests, you can bet your ass they’re going to show up in the general election in two years and vote against Trump and everything that he stands for. So for that purpose, primarily, I see this election as a shoo in for Biden. Round two. All he has to do is not die and he’s going to win.

Okay, in Queenstown now let’s see. What were we talking about…Biden and Trump? Oh yeah. Why it matters. Now, obviously, if you’re obsessed about who wins the US presidential election, it matters independently. But beyond that it raises the possibility that the United States is going to have the first extended period of agreement in its foreign policy across administrations. Now, let me explain that a little bit for Obama was infamous for never having conversations with anyone. So for seven of his eight years as president, we basically had no foreign policy at all. Then Donald Trump comes in and Donald Trump would tweet something bold and assume that that made it policy. But then nothing would ever be done with it because he could be bothered to have a constructive conversation with anyone in the government or the bureaucracy or Congress. In fact, at one point he said that his tweets were notification to Congress of certain policies, which clearly legally is not kosher. So for his four years, very little happened at the federal level. Biden has come in and Biden almost to a tee, shares Trump’s approach to foreign economic policy making. Extraordinarily populist, extraordinarily nationalist. But the difference between the two is that Joe Biden actually believes in the power of government. And can sit through a meeting in a way that Barack Obama could not. And so he is actually going back through Donald Trump’s tweets and turning them one after another into foreign economic policy and then embedding them into governance and into the American government bureaucracy. So if you are a Biden supporter, you should be furious because he’s taken all of his cues from Trump. And if you are a Trump supporter, you should be furious because Biden is getting all of the credit for Trump’s economic decision making and policy statements.

So there’s plenty in this video for everyone to get pissed off at. Now, if you disagree with my assessments on where this election is going and who we should blame for why, that’s fine. That’s fine. Go ahead and reach out and contact me. You can reach me at [email protected]. That’s [email protected]. I’m going to be here in New Zealand for the next three or four weeks and I will be doing a number of videos and reporting back to you. It might not be on the most current of current events because for most of this I’m going to be backpacking and I’m not going to have information access, but I will be back in time and we’re going to do a lot of deep dive stuff while I am gone.

So everyone have a great month and I will see you near the end of April. Bye.