France’s Demographic Blindspot: Racial Inequality

Riots have broken out in France after police killed a 17-year-old kid. When a similar situation occurred in ’05, there were weeks of riots. We can’t be sure if the same will happen here, but it’s worth looking into based on France’s unique demographic situation.

The US is no stranger to issues of race, but there are constant conversations on the topic, and members of most minorities are represented throughout all levels of government. The French haven’t quite figured that out yet.

France deemed their ethnic conflict so extreme they had to redefine what “being French” meant. So whether you were Catalan, Basque, from Paris or Marseille…you were now just French. This made tracking and collecting ethnic data illegal and unconstitutional. So France doesn’t even know how big their racial problem is…

They’ve essentially institutionalized racism and created massive divides between urban centers and marginalized areas where these “2nd class citizens” live. Lacking a proper understanding of the situation has made allocating resources outside of law enforcement a non-starter, further dividing the groups and adding tension to an already unstable situation.

Despite this vulnerability, I remain optimistic about France’s future. Given its self-reliant economic system and strong demographic picture, they should be just fine…they’ll have to sort this other stuff out ASAP though.

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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.
 
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TRANSCIPT

Hey, everybody. Hello. From Sunny Colorado. Today we’re going to talk about France. There have been a number of protests and a number of schools and police officers have been burned in the last couple of days. The triggering event is the police killed a kid. I want to say it was like 15, 17, something like that. And so there’s been this spontaneous uprising of violence. We haven’t seen activity like this since 2005. Back then, similar cause police killed a couple of kids that were hiding from the police and it triggered riots that lasted several weeks. Too soon to know if this is going to be one of those sort of explosive, protracted events. But it’s worth considering because France is not like a lot of other places. Now, here in the United States, we obviously have a checkered past and a checkered present when it comes to issues of race. And it’s part of the conversation all the time. And there are members of a number of minorities that are represented have been governments at all levels, especially the national level. We’ve even had a black president. That is not the situation in France. In France, they made the decision back after the revolution that ethnic conflict was so extreme that they had to redefine what the term French mean. So it didn’t matter if you were Catalan or Basque or from Paris or Marseilles or Alsatian, didn’t matter. Everyone was French now and all of the various groups that had been part of a series of civil wars and disturbances in France going back a millennium all of a sudden were considered all of the same family. And in the modern age, what that means is it’s illegal, unconstitutional, even to collect ethnic data on the French population. And if everyone was just Basque or Catalan or French or Alsatian, that might be okay. But that is not the France of today. As part of the colonial legacy, a number of people from the former colonies have moved to the mainland. France, metropolitan France and even have French citizenship. In fact, in some cases, their great great grandparents had French citizenship. So these are not people who arrived recently, but because it’s illegal, unconstitutional to collect any sort of racial data. They exist as a sort of second class. That is from the American term almost undocumented because of the racism that exists in all societies. So in the case of France, they don’t even know how big the racial problem is. It’s probably about 15% of the population is non-ethnic French, but legally French. And that has institutionalized the racism in a way that we have a really hard time processing here in the United States. In many cases, it’s more similar to what they’ve got in Brazil. You’ve got an urban center where the ethnic French live that is relatively well-off. And then you’ve got a ring of suburbs that is more akin to slums where most of the non-ethnic French who are still French citizens live. And because the French can’t even do the first step of collecting data in order to get a good grip on what the size of the issue is, it’s really hard for the government to apportion resources outside of law enforcement. So in many ways, parts of France, even in their major cities, resemble a little bit of armed camps. And that makes it very easy for violence to erupt, because it’s it’s not a big reach for people who are the subject of be living in the armed camps to rebel against the people who are supposedly providing law and order. Now, for those of you who know my work, you know that I’m very bullish on France in the long run. They never bet their economic, much less their political system. On globalization. And they never integrated their economy into the European Union. They’ve always seen themselves as a step apart. And that means that they’ve sacrificed a lot of efficiencies and a lot of the reach they could have gotten under the globalized era in order to maintain a more nationally oriented economic system. But comes at a big cost. But it does mean as globalization breaks down one, that the French don’t have that far to fall, because if the EU were to dissolve tomorrow and Freedom of the Seas were to cease to exist next week, the French economic system is largely in-house. There are massive producer and exporter of agricultural products. They’ve got energy nearby in both the North Sea and in northwest Africa. They’re several countries removed from the Ukraine war. And what’s going on with the Russians and their primary economic competitor is also their primary political partner in the current environment, and that is Germany. And unlike the French, the Germans have gone whole hog on globalization to the point that we’re already seeing massive problems there when it comes to exposure to the Chinese systems or the Russian systems or whatever. The French have none of that. And then finally, the French demographic is strong because there is a neo natal sort of policy set that encourages people to have kids in large numbers, giving France the healthiest demographic structure in the world outside of New Zealand and the United States happens to be third in that regard among the advanced countries. So all of these things add up to a strong prognosis for the French over the medium to long term. But the racial issue is absolutely France’s Achilles heel, and we’re seeing that boil up right now. All right. That’s it for me, you guys take care.

New Chinese Demographic Data = Population Collapse

Today we’re breaking down the new demographic data from the Chinese space. This will allow us to make some much-needed updates to an already bleak assessment…and spoiler alert, it’s going to get a lot worse.

The first graph shows us the demographic picture before any of this new data were released. You’ll notice China already has an incredibly fast-aging population. The number of people entering the workforce can’t keep up with retirees, so even when using the old data, labor costs were increasing faster than any country in history.

The second graph shows us what the new data are saying. The number of children under age five has collapsed, leaving China with nearly half the amount of five-year-olds as fifteen-year-olds. This happened well before COVID drove down birth rates and increased death rates. Even though this is the “official” Chinese data, it’s likely overly optimistic.

So that brings us to our internal extrapolation of the data as seen in graph three. Again this is our interpretation, but it gives you a better look at the Chinese predicament. Leaks out of China suggest the yellow bars don’t even exist; this means China isn’t a country in demographic decay…its a country in the advanced stages of demographic collapse.

China is entering its final decade of operating as a modern industrialized nation. For any foreign business still in China, those sunk costs on factories can only keep you there for so long…and it will only get worse from here on out.

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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.

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TRANSCIPT

Hey everybody. Peter Zeihan here coming to you from Marshalltown, Iowa. My mom was a little upset that the videos I did earlier did not have a flower garden in the background. So we. Topic today is Chinese demographics. We’ve gotten some new data out of the Chinese that has made it way to the U.N. and so the updates have allowed us to update our assessment and oh, my God, it’s bad.

Okay. So let’s start with this first graphic to show you where the official data have us. As of a year and two years ago, this narrowing for the bottom seven blocks is the fastest aging workforce in the world and arguably the fastest one in human history. This indicates that the number of new workers coming in is so small compared to the number that are retiring, that you’re having massive increase in labor costs and from adjacent numbers that we do trust.

I mean, Chinese data is always a little touch and go, but from the numbers that we do have that we do trust, which is labor costs, Chinese labor is increasing at the fastest pace of any country in any era at any time in history, including during the Black Death itself. Since 2000, the cost of Chinese labor has gone up by about a factor of 15, while the size of the Chinese economy has only expanded by a factor of but roughly 3.5 to 4.

So really, really bad. The Chinese are only in industrial power today under this data because of the sunk cost of the industrial plant that it took to build everything that’s there in the first place. Now, that’s not nothing that is huge. That’s, you know, trillions of dollars, tens of trillions of dollars. And it’s highly relevant. But most industries and most subsectors that have decided to relocate to other countries have discovered that they’ve got shorter, simpler supply chains where there are a lot less of a political headache.

Okay. Here is the new data. And as you can see, that the number of children who are under age five has just collapsed. And there are now roughly twice as many that are age 15 as there are age five. What happened back in 2017, well before COVID, is that we had a sudden collapse in the birth rate roughly 40% over the next five years.

Among the Chinese, the ethnic Han population and more than 50% among a lot of the minorities, and that is before COVID, which saw anecdotally the birth rate dropped considerably more and before COVID, which probably raised the death rate considerably. What we’re never going to get good data on death rate, or at least not anytime soon, because the Chinese, when they did the reopening, they just stopped collecting the data on deaths and COVID and everything because they didn’t want the world to know how many Chinese died.

So they don’t know. With this data, this snapshot in time, this is official state data. It’s still probably not wildly accurate. We still have the Shanghai Academy of Sciences, which is like the kind of the biggest nerd group you’ve got in the in the country, saying that the country has over counted their population under age 45 by over 100 million people in the aftermath of the one child policy.

And so really, what we need to consider is that that official data and at the very bottom, you need to play that up. And this last graphic kind of shows you our internal estimate of where that is. Now, this is not official, but those yellow bars probably don’t exist. But that is not what the official data is saying.

This is an extrapolation from the from what? The Shanghai Academy of Sciences is saying. Anyway, some version of this is probably the truth, which means that China aged past the point of demographic, no return over 20 years ago. And it wasn’t just this year that India became the world’s most populous country. That probably happened roughly a decade ago.

And it was it in 2018 that the average Chinese aged passed the average American. That was probably roughly in 2007 or 2008. So this is not a country that is in demographic decay. This is a country that is in the advanced stages of demographic collapse. And this is going to be the final decade that China can exist as a modern, industrialized nation state because it simply isn’t going to have the people to even try.

So for those of you who have business in China, you’re becoming more and more aware of the political system. You’re becoming aware that it’s becoming illegal for foreigners to even access data, data that in most countries is publicly available. You now have on top of that to figure out that not only is the labor force never recovered and the labor costs you’re having now are as low as they’re ever going to be, consumption is as high as it’s ever going to be.

So even before you consider the political complications or issues with operating environment or energy access or geopolitical risk or reputational risk, the numbers just aren’t there anymore. So you have to ask yourself why you’re still there. Sunk costs of industrial warfare. That’s a reasonable answer, but it becomes less relevant with every passing year as everything else catches up.

All right, you guys take care.

Putin Admits the Wagner Group is an Arm of the Russian State

The Russian state has kept a degree of separation from the Wagner Group for the past decade, but years of war crimes and avoided sanctions are about to come crashing down on Putin…

If you’re not familiar, the Wagner Group has been operating internationally as a gang of mercenaries and thugs since 2014. Most countries knew this was a branch of the Russian State, but many embraced the ‘legal deniability’ to protect trade and relations.

The Russian government just admitted that Wagner is, and always has been, an arm of the Russian State. Not only is this going to piss a lot of people off and start a new round of punitive sanctions, but it also means that the seizure of Wagner (aka Russian) assets will be starting up very soon.

Wagner’s capacity to operate internationally is going away, and Russia no longer has the ability to project power outside of the former Soviet space. So if you’re tired of hearing the name Yevgeny Prigozhin or Wagner, you’re probably in luck…

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.

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TRANSCIPT

Hello, everybody. Peter Zeihan here coming to you from Colorado. Today is the 27th of June. And the news is that the Russian government has admitted formally that Wagner is an arm of the Russian state to the tune of about $1,000,000,000 a year in terms of their outlays. Now, why is this important?

Now, Wagner was formed by the Russians, specifically by a guy by the name of Prigozhin back in 2013, 2014, in the lead up to the Donbass war, which is a war where the Russians basically created what we’re called little green men to fight on the other side of an international border and foment a, quote, secession war, and then under that pretext, move in regular forces. Well, no one really bought it, but the legal fiction did allow a degree of separation that gave especially the Europeans pause. And anyone who was looking for an excuse to continue normal relations with the Russians. The Germans are probably at the top of that list, grabbed onto that little flimsy bit of legalism with both hands and wouldn’t let go. In the years since, Wagner has been used by the Russian state in any number of conflicts all over the world, most notably in the Middle East and Africa. And in those operations, because it has not been a state entity, it has gleefully engaged in the series of massacres that are really war crimes by almost any definition. And so Wagner has been under sanction not just in the United States and the European Union, but Australia, Japan, a lot of other countries that we generally considered part of the you know, if you want, here’s a loaded term, civilized world – and are the the leaders of it are persona non grata at most of the world’s airports. Well, but as long as the Russians haven’t claimed that Wagner is one of their own from a government point of view, that it’s just a group of mercenaries, kind of like a Russian Blackwater, if you will, then that degree of legal separation allows Wagner to do what it wants might be under sanction, but it’s not like it’s under state sanction charges today.

Now that Vladimir Putin has said that Wagner is and always was part of the Russian state, assets of the Russian state can be seized in order to pay for things that Wagner has done in various countries. And whenever you have a government shift in one of the countries where Wagner is accused of war crimes or one bordering it, that has an influence in that area, you now have two things going on. Number one, the degree of legal installation is gone. Now, anything that Wagner does or has done, Moscow itself is culpable. And in a lot of circumstances, Wagner slash Russia have been compensated not with cash, but with, say, mineral concessions, with gold mines being a favorite. Those are now legally all up in the air. So the admission here not only is going to piss off a lot of people in Europe and generate an awful new round of punitive sanctions, it means that the assets of the Russian state and the assets of Wagner are now one and the same, and the same tools can go after all of them. And that flimsy legal pretext is completely gone now. And so anyone who had a line into a private asset by Wagner or public assets by Russia can now use those same tools to go after both. So we’re going to see a wrapping up of Wagner’s international economic position in a relatively short period of time. And it won’t take much of a government shift in places where Wagner has been accused of war crimes that include Sudan and the Central African Republic and Syria and Libya in order to see their military position wrapped up as well. And that, of course, assumes that nothing else goes wrong and several other things are going wrong.

So as you guys have obviously seen those Wagner through a kind of not-coup over the weekend and Wagner troops now have to pledge loyalty to the Russian state and hand over their heavy equipment to the Russian military. Some of them will. Some of them won’t. And what that means is there’s a smaller number of Wagner staff that are available to man all these international missions in the first place, even if the Russian government doesn’t go through and do a purge of them. And that purge is definitely coming. Remember that Vladimir Putin’s power center is not within the Russian military. They control it. But that’s not their power center. Their power center is within the security services, most notably the intelligence bureaus like the FSB and the GRU. And those institutions are very capable of doing a purge of personnel of people who are not physically in Russia. So we’re going to be seeing a lot of that. So Wagner’s capacity to function internationally is going to go down significantly. And since the Russian military no longer has the capacity to project beyond the former Soviet Union, you’re looking at all of this getting wrapped up one way or another, probably by the end of the year.

Alright. That’s it. Take care.

And Now We Return to Our Regularly Scheduled Program

Photo of Ukrainian soldier in front of flag

Despite all the hullabaloo about the not-coup in Russia over the weekend, this assessment that we had initially planned to publish still holds true for the tactical situation in Ukraine…as well as some of the strategic implications with the Russians.

Note: If you were following the Russia Coup Series over the weekend, you might have already seen the tactical update in this video. The second half (starting around 8:40) is the fundamentally new material.

Today’s newsletter comes to you from my parents’ front porch in Iowa.

We’re about three weeks into the Ukrainian counter-offensive, and most of the reports have left (more than) a little to be desired. While these tactical reports are lackluster, we must step back and break down the strategy behind everything. I’ll let the video speak for itself, but the main pieces we’re looking at revolve around movement and politics.

The Ukrainians are shifting their focus from command and control centers to munition dumps and infrastructure, allowing Ukraine to limit or, at the very least, complicate resupplies and the flow of Russian troops.

The nuclear discussion is finally happening in the US. A proposed joint resolution states any Russian (or Belarusian) action involving nuclear consequences will be considered an act of war under Article 5 of NATO. This is just a statement of intent, but at least they got the ball rolling on the strategic nuclear policy conversation.

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. It’s the 23rd of June coming to you from Iowa and I’m at my parents, where I am in town for a birthday. So I’m here on the front porch talking about Ukraine because why the hell not?

There have been a lot of reports over the course of the last week about how the Ukrainian counteroffensive is not going particularly well. I’d be lying if I said that that is a thought that hasn’t occurred to me. But I’ve always tried to step back and not use tactical developments to inform strategic discussions because there is the whole fog of war thing going on. The Ukrainians are keeping mum about a lot of the details, whereas the Russians are just flat out lie and no one really has an accurate picture of what’s actually going on on the various fronts.

That said, we’re now well into the third week of the conflict and the Ukrainians haven’t achieved any sort of breakthrough. There’s two main lines of defense that the Russians are trying to hold. The first is a series of minefields, and the second is a series of more strategic defensive emplacements like Dragon’s Teeth and Trenches. And the Ukrainians haven’t really been able to get past the minefields to get to the real defenses yet.

And what that means is they’ve just kind of been bogged down in attritional fighting. And because the Russians have an order of magnitude more industrial plants and reserves and at least a factor of three more population, any battle in which the Ukrainians are duking it out a mano a mano is not one that they’re going to do well.

And in fact, any battle where the Ukrainians only kill three times as many Russians as they lose in their own troops is a battle they’ve lost. So instead of seeing the dramatic breakthroughs that we saw in person in Kharkiv last summer, it’s been a slugfest and it hasn’t gone well. That said, a couple things. Number one, we’re still early in the offensive, are still probing for weaknesses.

They’re still going after command and control. And then second, in the last 96 hours, a few things have changed. First of all, three or four days ago, Ukrainians shifted from using their missiles to target command and control systems to going after ammo dumps. And you would do that when you’re getting to the next phase of the operation. You feel like you’ve broken up their ability to react and now you’re trying to not just to trick their forces, but make sure that the forces cannot actually get meaningful supplies.

But the real issue happened with the morning of Thursday, the 22nd of June, when the Ukrainians put some serious holes in a few supply bridges that are critical for Russian forces. And to understand the significance of that targeting shift, we need to look at a few maps. Here’s our first map of the Ukrainian space. Nothing too exciting here.

The red line is roughly where the front is. The Russians occupied the territory to the east and south of that line and the yellow bars are where the Ukrainians have put their primary thrusts. Now, the the one on the left there, that’s the separatists, the front. The Ukrainians have been expected to go in that direction since the very beginning of this conflict, because if they can push down to the Sea of Azov, they can basically isolate the entirety of the southwestern front and Crimea, because not only would there no longer be a land bridge between Russia proper and Crimea, but the Ukrainians would be able to target the Kerch Strait Bridge directly.

But they’ve had more success going further into the east because there are fewer defensive works. But still in all these cases, you’re talking about advances in the single digits of kilometers. No sort of strategic breakthrough where mobile Russian forces excuse me, where mobile Ukrainian forces and getting behind the Russians and isolate them and break them up and for strategic retreats and routes.

Okay. Here’s a zoom in on Ukraine. The single most important thing here is, of course, the Kerch Bridge, an attack, unclaimed attack. We don’t really know who did it, but either the Americans, the Ukrainians took out one of the spans of the Kerch Bridge last summer. Now the Kerch Bridge has three lines to it to two lane road connections and one rail connection.

The Ukrainians, Americans, whoever it happened to be, were able to take out one of those two lane road connections and start a series of fires on a railcar that was going by on the rail bridge at that time, which warped the bridge and made it impossible to handle cargo. So no more trains in and out of Crimea from this route and used to be the primary route.

And only two of the four road lanes were being asked to go on truck. And when they do have convoys coming or going, they have to shut it down to other traffic. So that was a big hit and it forced the Russians to shift their supply route over to this area, to the land connections that go into Crimea.

So let’s zoom in there. Now, first thing to understand about this area is a lot of this is not land. This entire zone here is a series of brackish lakes, which obviously you’re not going to be running cargo across. In fact, there’s only really two ways to cross. On the left, you’ve got the proper land connection, which is in all land routes that goes through southern Ukraine.

It is the furthest connection from the front. It’s not that the infrastructure there doesn’t work. It’s just that it’s not great. However, if you go to the yellow arrow, the one further to the right to the east, you’re looking at the Charnock crossing. Now, China has a rail connection and a road connection, and it’s these connections that the Ukrainians put some holes in.

They use a special kind of warhead, which I’m not going to go into detail because it’s not my focus. But it blew all the way through the concrete blue, all the way through the rebar, put a giant hole right in the middle of the thing. You’re not taking trucks across that. You’re not taking the rail across that until such time as these are repaired.

Repaired. It is not beyond the capacity of the Russians. But keep in mind that it’s been months since Kerch had that whole put it and the rail connection there has still not been rebuilt. One of the many, many downsides of the Soviet dissolution is we’ve had a simultaneous education crisis and demographic crisis now decades in progress. The technical education system in Russia collapsed back in the eighties and the demographics of they’ve had a death rate that’s been higher than the birth rate for 30 years now, which means that the youngest suite of people who have the full skill set to be technical experts, they’re in their fifties right now, will turn 60 this year on

average. They still haven’t replaced the span encouraged. They still haven’t replaced the rail system. There’s a question as to whether they can. Now, the China crossing is not nearly sophisticated. Instead of being a high elevated suspension bridge, it’s a low block bridge. It’s not blocking navigation. This is not a navigable waterway system. They probably can do it, but it’s going to take them a few weeks, which means in the meantime, any cargo going to and from Ukraine has to come from that western bridge.

And this means that the soldiers in Ukraine, the Russian soldiers in occupied Ukraine, are facing a double bind. Back to this map. Notice the city of Mariupol. Basically, any Russian troops that are west of that zone have basically been cut off from supplies that come from Russia proper off in the east. They got everything they needed from Crimea, which is, you know, more difficult to support now and now with the China Bridge off line, it’s going to take about a week for the Russians to reroute everything further west to then cross a larger just a chunk of territory that would suggest to me that the Ukrainians are as ready as they can possibly be to

make a push in that direction. Now, coming down from the Japanese here, it doesn’t really matter where they penetrate. As long as they reach the Sea of Azov, it could be east of Mariupol, it could be west of multiple. It could be anywhere in between. Any way that they can cut that land bridge forever and then have the range in order to hit the remains of the bridge to wreck if we’re going to see an attack, if this counteroffensive is going to really manifest as something, these are exactly the circumstances you would expect the Ukrainians to shape.

And now they’ve done it. And since there is going to be a window before the Russians can redirect supplies further to the west, the troops in the multiple area are now completely cut off, vulnerable. They’re not going to get reinforcements. They’re not going to get fuel. They’re not going to get artillery shells and ammo. Now would be the time.

Now, that’s the strategic picture that we’re seeing right now. There is also something going on with the politics. Also on the 22nd. 22nd was a big day. Senators Blumenthal from Connecticut and Graham from South Carolina, a Democrat and a Republican, put out a joint resolution that they’re trying to get passed that would basically say that any Russian use or Belarus should use directly or indirectly through the proxies of a strategic nuclear weapon, a tactical nuclear weapon, or taking actions that they omission or commission cause.

A meltdown at a nuclear power plant would be considered an act of war under Article five of Nito. The Russians have, we know from satellite photos, mined the coolant from of the Japanese power plant Smuckers. Anyway, what the idea is to warn not just Putin, but the people who would get the orders that if they follow those orders, that they’re not just simply going to be new, causing a nuclear catastrophe in Ukraine proper, but it will be perceived by the United States and its allies as an act of war, and they will be choosing to initiate a direct military conflict with the United States and the natural lights.

Now, this interpretation of Article five is an executive privilege. It is not something Congress can really put their their fingers in. In addition, a joint resolution is just that. It’s a resolution. It’s not a law is a statement of intent. So there’s no legal weight here. Also, Article five is something that will be decided among the allies, not by the United States, unilaterally.

So this is probably not the right tool to effect, the right tool for the job. But I’m very glad that the two senators have started the conversation because the Russians have long considered for several years that Crimea is an integral part of their own territory, the annexed it back in 2014. And so anything that pushes towards Crimea, you’re crossing the gray zone where the Russians might actually consider that to be a real war where the use of defensive nuclear weapons might be warranted.

Now, that is not accepted in the United States or in the West. In fact, it’s not accepted in China. It’s not accepted by Ortega in Nicaragua. No country in the world has recognized the annexation of Crimea by the Russians. In fact, aside from some foreign pro-Russian shills like Tucker Carlson, no one in the United States considers Crimea to be Russian territory.

But it doesn’t matter what we think. It matters what the Russians think and whether or not they’re going to treat Crimea like Moscow. And there’s only one way to find out. In addition, if the Ukrainians are going to win this war, eventually they’re going to have to cross the international border, not just into Crimea, but into Russia proper and take out some logistics tackle hubs that are on Russian territory that is clearly crossing into what is internationally recognized Russian space.

And again, the defensive nuclear question comes into play. So while this isn’t the right tool for the job that the senators have picked up, I’m very happy that they have decided to at least start the conversation in this country about something we haven’t had a conversation on since the 1980s strategic nuclear, their policy vis a vis the Russians.

This is a conversation we have to have and this is going to sound really weird, but we probably have the best president in 30 years to have that conversation. Say what you will about Biden and there is a lot to say. He was there as an old man when the first nuclear weapon was detonated back in 1945, 44, four forties.

So he’s seen the entire arc of nuclear policy in this country and gives him a unique perspective that we’re going to need in the months to come. So things have broken loose. It looks like we’re on the verge of seeing the real counteroffensive, or at least if it’s going to happen. It’s going to happen now. And we’re at the dawn of a new stage of the conflict where we need to be thinking about some much deeper questions.

All right. That’s it for me. Everybody take care. See you next time.

The Russia Coup Part 4: Psych!

For those of you who did more normal things this weekend, you missed a coup in Russia!

Or not.

As the saying goes, Russia is a mystery wrapped in an enigma inside a tuna salad sandwich that’s gone off.

Apparently the guy who launched the coup, Yevgeny Prigozin, the leader of the Russian paramilitary group Wagner, was only kidding. Whether his effort was a political stunt or negotiation tactic, it’s all over. It was fun while it lasted.

Here’s my assessment as to where things stand. There are certainly more questions than answers.

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.

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The Russia Coup Part 3: Russia’s Global Footprint

Whether at home or abroad, Russia is the world’s primary provider of lies, misinformation and propaganda. With the future of the Russian government now being challenged, expect wild, competing noise on any and all topics. The issue at hand is not all the Russian propagandists are on the same side.

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.

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The Russia Coup Part 2: The Propaganda War

Whether at home or abroad, Russia is the world’s primary provider of lies, misinformation and propaganda. With the future of the Russian government now being challenged, expect wild, competing noise on any and all topics. The issue at hand is not all the Russian propagandists are on the same side.

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.

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The Russia Coup Part 1: What the Hell Is Going On? (And the Ukraine Angle)

An attempted coup is in progress in Russia. The mercenary group Wagner, led by a one-time confidant of Vladimir Putin, Dmitry Prigozin, is attempting to overthrow the Kremlin. The implications for the Ukraine War are…massive.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
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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.

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Ask Peter: What’s the Deal with Manchin’s Gas Pipeline?

Democrat Joe Manchin managed to sneak a few clauses into the debt ceiling extension deal for the completion of his Mountain Valley Pipeline. Environmentalists are pissed, and fossil fuel lovers gave Machin a double thumbs up. So who’s right and who’s wrong?

For those who think wind and solar are the future and there’s no use case for fossil fuels, you might want to check the math. For wind and solar to be viable, they need a complimentary energy source…and natural gas is the best option.

For those natural gas lovers who think green energy can only work with massive subsidies, your math needs some checking too. In the right geographies, solar and wind are the cheapest energy option on an hour-by-hour basis.

While the Mountain Valley Pipeline might seem to benefit only one side of the aisle, Manchin moved us one step closer to the inevitable future of American energy. It’s not green. It’s not fossil fuels. It’s both. And I’m okay with that.

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.

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TRANSCIPT

Hey everybody. Peter Zeihan coming to you from the ever increasingly foggy Docman Trail. This is the next in our Ask Peter series that was born out of my airline delay. Today, the question is about Joe Manchin, the Republican excuse me, the Democrat, from West Virginia, who has managed to insert a couple of clauses into the deal with the White House to extend the debt ceiling. Specifically, it’s something that it mentioned has been after a while, which is permitting and federal approval to get a new pipeline built through West Virginia to ship natural gas. Environmentalists hate it because it’s natural gas, pro fossil fuel folks obviously think it’s okay. The truth is that everyone’s right and everyone’s wrong. So let me kind of lay out what it means.

Let’s start with the green side. For those of you who think that solar and wind is the future of energy and that any sort of fossil fuel is just antithetical to that future. You’re clearly very bad at math. Just think of every day in your life when the sun goes down. Solar. No longer works. And while you can’t use batteries a little bit, the United States right now has less than a couple of minutes of battery storage and there is not enough lithium on the planet for the United States to get to 4 hours of battery storage. And we don’t have a battery chemistry that would allow us to go not just through the night, but through the winter and through periods where there’s usually not a lot of sun, which, if you live in the American Northeast, is the vast majority of the year. So you need a complementary power source that can work with solar and wind. And the best way to do that is with natural gas. You basically use solar when it’s available and you have a combined cycle natural gas plant that can spin up in 10 to 15 minutes whenever it gets cloudy or whenever the sun goes down, you know, every day for the foreseeable future, until we have a better, better technology or better solar or probably better wind is what would get there first. This is just where we’re going to go. So if you want to build solar and wind without a complementary system, you’re then basically forcing anyone who needs emergency power to use a diesel generator. And as we’ve seen in the case of Germany, they have used Lignite coal as the backup. And you can’t spin that up and down in ten or 15 minutes. You have to leave that on the whole time. So despite $2 trillion in green tech build out, Germany’s carbon emissions have actually gone up. So, you know, there’s a problem.

Now, for those of you on the fossil fuel side who say that intermittency of solar and wind means it’s not a viable power source and it can only exist with subsidies. You’re not very good with math either. Solar and wind in the right geographies are now the cheapest way of generating power on an hour by hour basis. Now, hour by hour being the key word there, there’s something that some folks like to use called the levelized cost of operation, meaning that you average the cost out over the 24 hour, three, 24 hour day three in a 65 day year period. That’s really not a great measure, because when the sun stops shining, the power goes down to zero. You still need it. And that’s not reflected in the levelized cost, or at least not sufficiently, in my opinion, because, you know, when you don’t have power and you need power, you will pay whatever you have to do to get power. There are parts of the country that can do more of one or the other. So if you’re in the American Northeast, which is neither sunny nor windy, you know, fossil fuels are going to be a much bigger part of your power mix going forward than it can be in the rest of the world. However, if you’re in the southwest, you’re in a place that has great sun, and if you were the Southwest overlaps with the Great Plains, you’ve great, great sun and wind. And that means ultimately more and more and more things like what Manchin is after. Keep in mind the pipeline he was so much in love with the way he wants to get this done is not just a one off approval for a pipeline across a state line; he wants that for all energy infrastructure. And obviously the green zealots think this only means pipes, but it also means power lines, because if we’re going to move to a cleaner, greener future, we have to be able to move electric ones from where they can be generated with solar and wind to where we actually live. And since the single largest concentration of population is on the American Northeast coast, and that’s where none of the green power comes from, we’re ultimately going to have to run this in by wire from other places. So we need more and more transmission, more than we need something like batteries right now, at least with today’s technology.

So the future of American electricity isn’t green, but it’s also not fossil fuels. It’s both. I’m okay with that.

Mr. Modi Goes to Washington

Prime Minister Modi is stateside and prepping for his address to Congress and state dinner. While a summit with Modi may have been inevitable (as he’s the leader of the most populous country and up-and-coming power), we need to look at India’s relationship with the rest of the world to see what might come of this meeting.

Given India’s fractious decision-making system – with most decisions occurring at the state and local levels – operating as a “country” is out of the question. India is only interested in things that impact India, so relationships and allies won’t work. The Soviets established ties back in the day, but that relationship is functionally over.

India has other factors that have inhibited its ability to form strategic relationships (or contributed to its ability to remain independent). Geographic barriers have helped keep others out, but also prevent India from projecting power. India is near the Persian Gulf, so they don’t need to worry about an energy crisis. They have decent demographics and plenty of time before any problems would arise. The collapse of China will send India into an industrial boom where they will be able to manage everything in-house.

All of these factors have enabled India to become a globally significant economy without being globally wired. Now the question remains…do I see anything meaningful coming out of this meeting? No, but a conversation about the future is better than nothing.

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

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TRANSCIPT

Hey everybody. Peter Zeihan here. Iit is the 21st of June. Well, here’s Loki. Today we’re talking about India. Look, he’s from India. Bengal. Anyway, Prime Minister Modi is in Washington right now. And by the time you see this on Thursday, he’ll be getting ready for his address to Congress as well as official state dinner.

There was some debate in Biden world about whether this is going to happen because in the past, Prime Minister Modi, especially before he was prime minister, hasn’t been a particularly nice guy. A little on the corrupt side, a lot of the popular side is willing to use religious divisions in order to further his political agenda, which is, you know, relatively distasteful from the American point of view and a lot of other points of view. Many would argue the Indian point of view anyway. He is still the leader of the most populous country in the world and an up and coming power.

So obviously there was going to be a summit. The question whether he would be welcomed as warmly as he has. A few things we need to talk about India, the Indians and the relationship with the wider world and the United States in particular. First and most obviously, the Biden administration has a few things that it wants from the Indian administration, that it would like more cooperation on things like the Ukraine war and sanctioning Russia.

They would like more cooperation on things like tech sanctions and in general, the diplomatic isolation of China. And the Biden administration is going to get none of that. The key thing to remember about India is that India looks out for India’s own best interests. And while every country does that to some degree, the big difference between India and everyone else is that India is not really a country.

It’s more like the Holy Roman Empire, where there is technically a central government, but almost all decisions that matter are made at the state and local level. And so while Modi is nominally the leader of this, and that does give him significant power and influence, he is only the most powerful of several dozen personalities across the Indian system who have decision making power.

And so the capacity of India to act like a state in the way that we think of that with France and China and Japan and the United States and the rest is very, very weak. Second, because of this internal, fractious, ever shifting coalition in competition, India, first and foremost concerned about how do things in the world impact India and makes it very, very difficult for the Indians to identify with any other power in terms of friendship or family or alliance or in sometimes even partnership.

So unless they see someone on the outside that is backing them and to the hilt for absolutely every little thing they care about, they’re going to call the relationship at best complicated and cold. It’s a very myopic way of looking at the world. But India has a very peculiar geography. It’s basically locked off from the rest of the world by a series of geographic and geopolitical barriers.

There are mountains and deserts and oceans and jungles and jungle, mountain and jungle deserts that general deserts. Sorry, desert mountains that separated them from everyone. And that’s not even all of it, because in a lot of these border territories, you’ve got hostile powers, whether it’s Pakistan, Bangladesh, Myanmar or, of course, China. So the ability of India to interact with the rest of the world has always been circumscribed.

And unless you are willing to back India on everything that involves their immediate neighborhood, without question, they’re going to view you with a bit of suspicion. This is one of the reasons why the Soviets during the Cold War were able to make India into a bit of a partner because they had no interests in Southeast Asia. So they just backed who ever happened to be the biggest power India, against everyone else.

And so the Indians developed a bit of a shine on all things Moscow, which has persisted long after the communist system has ended. What this means for the United States is India cannot ever be family. It can never be an ally, it can never be a friend, but it can be a partner from time to time. But because the Indians view everything through the very short sighted lens of national interest, they don’t have anyone who will watch their back.

The Russians have proven they’re not a reliable partner and the Indians are backing away from their defense cooperation with them, because the Indians now realize that the money that they’ve spent has been wasted, that the Russians can’t maintain their own output. They’re actually asking for some of the components back in order to support the war in Ukraine and at the high end works like the Brahmos cruise missile.

That’s just not going to happen at all. And so the Indians, you know, they’re not dumb. They’re short sighted. There’s a difference. And eventually you get to a certain point where they realize now they would only be putting good money after bad. And that means the Russian partnership, if that’s the right term, is now functionally over as well.

India is also not going to help the United States in boxing in the Chinese because they have a hard time seeing past their own nose. And anything that reeks of American leadership, which, you know, obviously would be in play here is something the Indians are going to reflexively recoil against. Now, does this mean that I think India is doomed?

No. Far from it. A couple of big things to keep in mind. Number one, geography works both ways. India has a hard time projecting out other powers, have a hard time projecting in, especially on land for naval powers like the United States and Japan. That’s less true. And that’s one of the reasons why this quad idea exists, because Japan, Australia, the United States and India can cooperate to a degree on naval issues that affect the Indian Ocean Basin because Japan, Australia, the United States don’t have strong interests in the Indian Ocean Basin, especially now that the war on terror has been closed down.

There was a period for the last 20 years where Indian American relations were not hostile but problematic because the United States had to be up to its hips in all things Pakistan in order to get military supplies to its operation in Afghanistan. Now that that’s over, the Indians and the Americans can commiserate about how much they dislike all things Pakistani, and that’s done wonders for their relationship.

Second, India is the first major country after you leave the Persian Gulf, which means that no matter what happens with global commerce or global energy, India is the first in line and it will never really have an energy crisis compared to what’s shaping up for the rest of the world. That’s amazing. Third, India’s demographic structure, while not perfect, is night and day different from the country they love to compare themselves to?

And that is China. New data out of China in just the last few weeks indicates the demographic profiles of Harvard. Worse than even I thought. The Chinese are now publicly admitting they have about half as many five year olds as ten year olds. So you carry that forward with some of the other problems that dividing reified with their own demographic strategy.

And it looks like whatever I was thinking was going to happen, which was already pretty atrocious, may have already happened. And we’re looking at a complete hollowing out. Now, India started to industrialize in a big way 35 years ago, and so the birth rate has dropped. But at current rates of birth rate decline, India will not find itself in a Chinese style situation for another 60 to 70 years, and that’s a long time for things to go right.

So India does have a demographic dividend to go along. A young adults that had fewer children in the past, that generally spells an opportunity for a 20 to a 30 year consumption driven growth opportunity. That’s not without risk. But on the mechanics of it, the next couple of decades look great. And then the fourth, as the Chinese face problems, a lot of the manufactured goods that the world has been importing from the Chinese system are going to go away.

Now, that means if countries still want stuff, they to have to build out their own networks to build that stuff themselves. If that applies to India just as much as everywhere else. So we should expect to see a 2 to 3 decade industrial boom in the Indian space as well. Now it will be different from what’s happening in Mexico because remember India has no allies, no friends and very few partners, and those partners are erratic.

So the sort of manufacturing synergies that Canada, the United States and Mexico and to a lesser degree Central American Columbia can generate. India has to do it all itself. And that means it’ll be more expensive, more time consuming and slower to happen and use more labor, be less productive, less efficient at the end of the day, have lower quality product.

But in a fractured world, India will have something that a lot of countries won’t. It’ll still have stuff. And in that sort of world, India looks good. They are perfectly capable, the Indians, of running an economy that is globally significant without being one that is globally wired. So for Biden, do I think anything of substance is going to come out of this summit?

No. The geography of India, the politics of India, the ideology in India probably precludes that. But that doesn’t mean that the relationship has to be hostile. And if there’s going to be a major power in a different hemisphere, in a strategically interesting area, you should at least have a conversation. And so think of that as what’s going on with the Biden administration right now.

Not a plan for the future, a conversation about it. We could do a lot worse. All right. That’s it. Take care.