In the early hours of Monday, Feb. 6th, an earthquake with a magnitude of 7.8 hit the city of Gaziantep in southern Turkey. The quake was felt across Turkey and deep into Syria, leaving behind a path of deadly destruction.
At the time of recording, the death toll in Turkey and Syria was in the 2,000s. At the time of scheduling this newsletter, the death toll in Turkey and Syria is well above 3,500 and will continue to rise throughout the coming days.
Natural disasters happen at random, but that doesn’t mean they can’t also be geopolitical events. The 2011 Togoku earthquake/tsunami that took the Fukushima-Daiichi nuclear reactor offline had grave consequences for global nuclear energy policy. In Turkey’s case, expect Sweden and Russia to offer humanitarian aid and try to get back into Ankara’s good graces.
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.
Hey everyone. Peter Zeihan here coming to you from somewhere in Florida. On Monday, the 6th of February in the early hours, an earthquake hit the city of Gaziantep in south central Turkey, which is hard up on the Syrian border. And the destructive capacity of it was 7.8 on the Richter scale. It was felt as far away as Hatay, which is where the Turkish territory meets the Mediterranean as well as, well into Turkish Kurdistan. And of course throughout most of Syria.
Devastation is considerable. This is definitely the strongest earthquake that has hit the area in about 20 years. Early death estimates are already well over 2000. They’ll probably be over 20,000 within a week. When earthquakes hit this area, they can really be awful. We are in a very seismically active area here and a lot of the construction is not what you consider up to, say, a Japanese style standard. So the idea that you could actually reach 100,000 deaths is not out of the ballpark.
Earthquakes are often geopolitical events, not in that they wreck countries, although they do, but instead they provide opportunities for diplomatic breakthroughs. And as regards Turkey, at this moment, there’s really two countries that would be really, really looking to provide some aid in order to tilt politics and Turkey in their direction.
The first one would be Russia. Turkey is one of the very few outlets that the Russians have right now for getting their trade in and out. And the Turks have been acting as middlemen. So if the Russians were able to provide some sort of diplomatic and economic emergency assistance and bridge building relief crews, that sort of thing, then you could see some significant warming in relations. The problem, of course, is that all the Russians’ capacity is already spoken for in Ukraine, and it’s not clear that it’d be worth the Russians time to pull people off of the front lines in order to give supply to the Turks. The Russians have something called the Disasters Ministry, which is actually really good at doing stuff like this. Used to be run by Shoigu, who’s the current defense minister, but it’s really just a paramilitary arm of the government, and it’s just completely spoken for already.
The second group that would have an interest of maybe tilting things diplomatically with the Turks would be the Swedes. The Swedes have been trying to get into NATO’s for about a year now, and the Turks have been threatening to veto over membership because of the Swedes taking a certain position on Kurdish issues with the Turks think is FEMA to them being an alliance. But if Sweden, which does have some spare capacity and does have a good record of humanitarian effort, even with the Kurds, were to provide that with the Turks, it might just provide the sort of opening that the Swedes need to get over Turkish hesitance in terms of letting them join the alliance.
So those are two to watch for. You won’t have to wait very long. This is the kind of thing that either happens or it doesn’t within just a couple of days because after that it’s too late and the people buried under the rubble are already gone. So we’ll know soon.
For solar power to make sense, there’s one non-negotiable component…and yes, it’s that bright, shiny thing in the sky – the sun. But just because your planet has a sun doesn’t mean you should use solar power…
The best examples are places like Denver or SoCal, where the sun is out showing off most days of the year. Then you move on to places like New York, Toronto or Berlin – which have plenty of overcast days – and your case for using solar power goes out the window.
The point of all of this isn’t to say that solar power can’t be part of the energy solution, but there are still quite a few hoops we’ve got to jump through to get there.
Prefer to read the transcript of the video?Click here
Join me on Feb. 17th for the webinar – Global Outlook: One Year into the Ukraine War.
We’ll dive into the global impacts the war has had on supply chains, agriculture, and much more. After my presentation we’ll have a Q&A portion to answer all those burning questions.
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.
Hey everybody. Hello from Colorado. Peter Zeihan here. Today I wanted to talk about solar. Since it’s a sunny day. I am green, but I’m a green who can do math. So I don’t get invited to really any of the green parties. Solar is great if you know, if you have one of those a sun, not just you have to have one for your planet. You have to be able to see it regularly. Solar intensity around the world varies by an order of magnitude based on where you are, and if your goal is to both generate a meaningful amount of electricity and reduce your carbon footprint. There are only a handful of places where today’s solar technology really work well.
Now I live in one of them. Denver is the sunniest city in the United States, and people like, Oh, shouldn’t that be Phenix or Dallas – no. Because there’s more things that go in there than temperature, humidity, air density, wind patterns, weather patterns. Denver sits on the Lees side of the Rocky Mountains. So it’s in the rain shadow of the largest mountain range on the continent. And it gets its weather in two phases. Either storms that blow in from the mountains or storms that blow off the Great Plains. In both cases, the storms tend to be cold fronts, so they whip through fast. They drop a lot of rain or snow and then they move on, leaving clear air behind.
If you’re in Phenix, you’re going to be dealing with a lot of particulate matter because of the dry desert nature of the place and a lot of smog. If you’re in Dallas Fort Worth, you’re dealing with humidity. There just aren’t very many places in the world that have a really good solar quotient. And in the United States, you’re pretty much talking about the California coastline into southern California and then into the desert southwest. And there’s this little hook up the east side of the front range, which is where I live. In fact, I’m one up on Denver because I’m at 7500 feet. So we regularly get snow in our valleys and fog in our valleys and Denver will get fogged in. But I am a half a vertical mile above Denver and so it is very rare for my neighborhood to be fully cloudy for a whole day. It only happens about 20 or 30 days a year as opposed to when you have an atmospheric haze, which in most populated parts of the world lasts pretty much, you know, entire seasons.
That means that my panels, if you were to put them in New York, only generate about a quarter of the power that they generate for me. Put that in Toronto you’re down to one fifth. You put in Berlin down to one sixth. As a rule, most of the human population, most notably in Southeast China or excuse me, and the East Chinese coast, Northern Europe and Northeast United States. If you put up solar panels, you are most likely generating more carbon from the creation of a panel and transmission system than you’ll ever pay down from the electricity that you generate. So you’re actually contributing to the problem rather than solving it.
Which brings us to a second problem. I live in a rural area, so I’ve got a big roof line and I have an 11.5 kilowatt solar system, which is about the maximum of the Colorado allows when you’re going to do a feed in tariff, which is a fancy way of saying that you pay into the grid with electricity, the same rate that they charge you going to get it out. It’s a great system we’ve got here in rural Colorado. Most cities don’t have that option. Number one, you’re going to have to have a more profit driven electrical system. I work with a co-op, which means they’re not going to give you as generous of feed in rates and second cities by their very definition, are densely populated. Solar, by its very nature, has to be distributed.
So, yes, if you live in a traditional single family neighborhood with homes, with sizable roof lines and a lot of south facing frontage, you may, may, be able to have a decent solar quotient for your system, especially if you live in the American Southwest or California. But if you live in a mid-rise, much less a highrise, much less in a calculated city like Chicago or New York, there’s nowhere to put the panels in the first place. You’re going to put them outside of the city, and now you’re talking about transmission costs. And if you’re in New York, you’re not going to put it outside of city of New York because that’s equally cloudy. You’re going have to go down like central Virginia. And then there’s a half a dozen major cities between you and we’re going to be pulling your power from.
It’s not that solar can’t be part of the solution. It can. But it really only works in some very specific geographies like where I live, where it works really well. For us to fix this, three things need to change. Number one, we need panels that capture more of the sun and translate more of its energy into electricity. The rate of recovery for that has been incrementally going up for a while now. There is now panels on the drawing board, not on production, on the drawing board that can capture as much as half. That’s great. A huge step in the right direction. But you also then need transmission to get it from places that are sunny and you put up your solar panels where people actually live. And to do that at scale, we’re not just talking about high voltage lines that cross state lines, we’re talking about relatively room temperature semiconductors. And for those of you been following some of my other energy work, you know, the same thing is basically basically necessary for diffusion power as well. Single large facilities that you want nowhere near a city that can transport the power over hundreds of miles if necessary.
But the third thing that’s probably going to be the most problematic in the near term, and that’s capital. When you put up a solar farm or wind farm or any sort of green tech, you have to pay for it up front, which means you have to finance it. If you’re putting up a coal and natural gas plant, most of the cost of operating that plant over its lifespan is in fuel. So you pay for that as you go. The financing needs are not nearly as much. And with the baby boomers moving into mass retirement and liquidating all of their high velocity capital, all their stocks, all their bonds, everything is going into T-bills and cash. And the volume of capital that is available to finance green tech projects just isn’t going to be there at the scale we’ve become used to. And that’s not just for green tech. That’s for everything from car loans to borrowing to pay for super carriers, everything is going to get more expensive to finance. And since green tech must be financed upfront, it is going to be the economic subsector that’s probably going to suffer most dramatically over the next few years. Unless the technology changes, you change the technology on me. I reserve the right to change my mind.
Today we’re talking about the overlooked redheaded stepchild between mining raw materials and incorporating those into a product…processing. Essentially throwing tons of energy at the ore through several steps and facilities, converting them into usable materials like aluminum or steel.
For the vast majority of materials, this processing is carried out in 1 of 2 locations – China or Russia. This is a result of subsidies or cheap energy. However, all of that is changing thanks to the collapsing demographics of these two societies.
The reason for the redheaded stepchild analogy is that processing is about to become very annoying for the rest of the world. Not because it’s expensive or difficult to do but because the decrease in supply is culminating with an increase in demand thanks to the green movement.
Prefer to read the transcript of the video?Click here
Join me on Feb. 17th for the webinar – Global Outlook: One Year into the Ukraine War.
We’ll dive into the global impacts the war has had on supply chains, agriculture, and much more. After my presentation we’ll have a Q&A portion to answer all those burning questions.
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.
Hello from sunny Colorado, Peter Zeihan here. Today we’re going to talk about processing. So a lot of people are familiar with some of the issues and opportunities that come from any number of industrial materials, whether that’s iron ore or aluminum or lithium or cobalt. But in between the mining and the actually incorporating the product into something that we actually use like lithium into a battery or steel into a car, there is an intermediate processing step that tends to just kind of get ignored and that’s about to become a very large concern for any number of sectors and countries. Once you get the raw material, the ore, the industrial material itself out of a mine, you then have to basically throw a lot of energy at it. Breaking down the orders to separate out the metals or the other materials that are within is an incredibly energy intensive process that usually takes place over several steps and within those several steps, not always can the same facility do all the same processing. So for example, you can smelt bauxite in order to get an intermediate product that looks a lot like cocaine called alumina. But then a different facility is needed to basically electrocute the crap out of it in order to transform it into aluminum. And you’ve got processes like this for everything, typically for steel, your first step is to throw it into a foundry with some coal into a blast furnace, and then you get something called pig iron. And then as a rule, another facility will turn it into type of iron and steel that we use every day. Now, the problem we’re facing is that most of the world’s materials processing is done in two specific locations. The first is in China. Now the Chinese have heavily subsidized their entire industrial base whenever they find a technology that they can master without needing input from another country. And since steel smelting was developed well over a century ago, this is something they have no problem doing. So they are by far the world’s largest producer of raw and finished steel. Though subsidies have taken the form in many cases of financial assistance. Basically, if you can get a bottomless supply of 0% loans and you can build whatever infrastructure you want, and that’s helped drive more profit driven industries out of business around the world. The second big player is Russia, and this is largely because they have very cheap electricity, because when the Soviet system collapsed in 89, the entire industrial base basically went kaput, except for the electricity generation system. So what the Russians did was they would import raw materials, use their cheap power and their cheap coal to do the processing, and then export a degree of value added materials. And they do this pretty heavily with aluminum. They do this with chromium, they do with this what, titanium materials that they don’t really mine themselves, but they will bring them in for processing. There are very few materials in the world where this is not true. And if you’ve been following me for some time, you know that these are the two major countries that are facing the biggest demographic economic, financial and security crises of the world we’re evolving into. So we need to prepare for a system where materials that come out of these two countries, intermediate and finished materials, maybe don’t go to zero, but certainly face a significant
collapse in the volume that they produce. There’s nothing about this that can’t be done anywhere else. It doesn’t even take a huge amount of time and it doesn’t even take a huge amount of money because a lot of this is technology that’s, you know, 50 or more years old. But that doesn’t mean it’s free. And that doesn’t mean we can do it overnight. And even if all siting and regulatory concerns vanish, you’re probably not going to put up a smelter for cobalt in the United States and anything less than a year. So not only with the way technology is evolving do we need a lot more critical materials and not only with the industrialization of the United States, do we need a lot more steel and aluminum? And not only with the green transition, we need a lot more graphite and chromium and nickel. We’re also looking at losing a lot of the world’s processing capacity for these things all at the same time. Something’s going to have to give and that is going to be one of the greatest economic arguments, fights and perhaps even wars of the next ten years. Stay tuned. We’ll talk about more of this sort of thing on and off for the next several months, because it’s getting to the point where it’s becoming not a hypothetical problem in the future, but a problem in the here and now. Oh, hey, all this talk of processing reminds me that we are having a webinar on February 17 that is going to be going into the economic implications of the Ukraine war one year on, and the implications for Russian minerals and minerals processing is a big, big part of all of that. So we’re going to include the sign up information for that webinar at the end of this email. Feel free to come. Anyone who signs up is going to get a PDF of the full presentation, complete with the data and the graphics, as well as a link to the video itself for future ruminations. Okay, that’s it for me. For real. Until next time
The globalized world has seemingly been great for everyone…security, access to foreign markets, the list goes on…so why would the US choose to continue down the path of deglobalization?
The US has been heading down this path for years, and they’re well past the point of no return. There are a few reasons we ended up here: the US never benefitted from this arrangement like everyone else, American politics are all about casting a wide net and making the most people happy (so when the globalization topic is hurting your party, you give it the cold shoulder), and most importantly, demographics.
Perhaps the only thing that could flip the script and make the US rethink this would be a security threat that impacts Americans more than anyone else.
Prefer to read the transcript of the video?Click here
Join me on Feb. 17th for the webinar – Global Outlook: One Year into the Ukraine War.
We’ll dive into the global impacts the war has had on supply chains, agriculture, and much more. After my presentation we’ll have a Q&A portion to answer all those burning questions.
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.
Hey everyone. Peter Zeihan here, coming to you from Colorado today. I wanted to answer a couple of questions that folks had, namely why I’m so confident that globalization is past the point of return. The idea is that if the United States has benefited from globalization for so long, why, even if it was in danger, wouldn’t the U.S. just kind of double down?
Three things. First, you’ve got to look at why the United States did this in the first place. Globalization was never about the economics for the United States, or at least not about the economics in a traditional sense. The United States had the world’s largest economy long before World War Two, and with the war we found all of our potential rivals, cooperation nations, friends, allies, enemies everybody put together have an economy that was about the same size of the United States. And economic growth was hard to come by. Economic security was impossible. And a big part of what led to that was competition over resources, over lands, over security. Basically, all of the things that have colored human history since the beginning.
So the Americans came to the conclusion that when they were facing down Stalin in the middle of Europe, that there was no way that Americans would be able to economically, politically support the kind of conflict where the Soviets were right there and we were an ocean away, especially when we would be fighting on the territory of countries that have been absolutely devastated.
So the solution was to bribe everybody to use our Navy to patrol the global oceans so that any one of our allies could go anywhere at any time and interact with any other player, access any material, and especially access the American market, which was really the only one of soft to survive the war. The catch was you had to let the Americans write your security policies.
And so never forget that from the very beginning, the very concept of globalization for the United States was never about security. I’m sorry. It was never about economics or trade. It was about security. We pay you to be on our side. And that worked. And after 40, 45 years, the Cold War ended because the Soviet system could not compete, because the Americans not only held the security upper hand, but it created this alliance of economies that were massively larger. Because by the time we get to the 1980s, Korea, which had been the world’s fifth poorest country in per capita terms, actually surpassed that of the Soviet Union. So there was just no long term competition to be had. Now, that was 30, 35 years ago. And since then, the world has changed. We’ve entered into a hyper globalization era where any number of other players have come into the global system and participated under the rules the U.S. set up.
And this means it’s not just the West and it’s not just the Asian protectorates, but it’s Southeast Asia, it’s Brazil, it’s India, it’s Russia itself, and, of course, China. We’re no longer in a world where the U.S. economy is as large as everybody else put together.
Based on how you do the math, the rest of the world combined is three or four times the size of the United States. So doing indirect economic subsidization, as the U.S. had for 45 years, became less and less tenable over the next 30. And we’re now in an environment where some of these countries, China, for the most part, are so overextended and so dependent on globalization that the only way they can survive is as the United States increases support, not decreases. Their demographics mean they have no market. Their lack of military reach means they can’t get energy, and their dependance on the Russians means that the country that is most likely to use economics, especially raw material supply, in order to achieve geopolitical concessions, is now their single largest partner. Newsflash that’s not going to end well. Okay, so that’s kind of piece one. The idea of globalization is no longer benefiting the United States because we’ve never viewed it the same way as everyone else.
But there’s a couple other reasons to think of. First, American politics. During the Cold War, we had a pretty strong bipartisan foreign policy. Remember that American foreign policy is a reflection of its domestic policy. And every generation or two Americans go through and kind of fabricate what their parties mean. This is part of a side effect of having a first past the post single member district system, which is a fancy way of saying that you vote for a candidate who’s going to represent a specific geographic area and they have to get more votes than whoever comes in second. So the parties have a vested interest in throwing as wide of a net as possible so they can get that extra marginal vote. Well, every few decades, politics shifts because demographics change and economics change and security changes. And if you think about what we’ve been through in the last 35 years, the Cold War has ended. Hyper globalization has risen. Hyper globalization has fallen. The baby boomers were in their prime. The baby boomers are now retiring. We’ve had the information revolution. We’ve got social media. Of course, we’re going to handle our politics different. And when you do that, the factions that make up the parties move around. Remember, big net, big, big tent parties. That means they’ve got lots of factions that are always struggling for dominance and influence.
When politics shifts, those factional alliances don’t make sense anymore. And so they have to evolve. And the politics don’t just rise and fall within the big tent party. They fall out. They shift sides. And if you look at what has happened so far, none of it supports globalization. So, for example, unions have largely fallen out of the Democratic coalition. The Trump coalition was fairly successful at drawing them out. They are very anti-free trade. The Trump administration also kicked the business community and the national security conservatives out of the Republican coalition. Those were the two factions for economic and security reasons that were most in favor of globalization. And so now we’ve got the Biden administration and the Trump led Republican coalition that is basically having a tug of war for the unions.
So it’s just like we can’t have a conversation about immigration in the United States because the unions don’t want to have it. No one in Washington wants to talk about globalization in a positive light because the unions are at stake in terms of which political alignment they’re going to take. And the two groups that used to like globalization, national security and business conservatives, they’re not even part of the room anymore.
But probably the biggest reason is the third one, and that’s demographics. When you urbanize and industrialize and for most of the world, they didn’t start that in earnest until 1945 or in the case of the developing world, until 1992. You move off the farm, you move into the town, and instead of working on a subsistence agricultural system, you now are getting a services, a manufacturing or an industrial job. And that means you are living in condos or single family homes or townhomes that are crammed together and in that sort of environment, kids going from being free labor to just being expensive headaches and you have fewer of them. Well, for the rich world, these transition has started 75 years ago. For the developing world, they started 40 years ago. You play that forward and the world is literally running out of people age 20 and under and has for 20 years now, which means now most of the world has run into people 40 and under. Well, the whole idea of trade, the whole idea of globalization is someone has to buy this stuff. Trade makes no sense if there’s nobody on the other end of the sale.
And we are now entering a world where the people who traditionally have done most of the consuming people, 45 and under the folks who are having kids and buying homes and cars, they just don’t exist in the necessary numbers to sustain the system. You’ve undoubtedly heard from me about how the Chinese and the Russians are the two fastest aging societies in human history. But the Germans aren’t far behind. And the Koreans behind that and the Indonesians, the Indians and the Brazilians are actually aging faster than what most of the developing world has done for the last 70 years. And you only have to fast forward to about 2040, 2045 before the average American is younger than the average Brazilian. And ten years after that, younger than the average Indian, Indonesian or Mexican.
So we no longer have the security parameters to make this work because the Americans aren’t interested. We no longer have the economic basis to make this work because we don’t have enough young people to consume? And the Americans are taking a political moment for themselves that’s going to last a few more years in order to digest whatever is going to happen with the unions and that is more than enough time to kill any remnants of the globalized system.
What would need to happen if the United States really wanted to get back in this game is some sort of security scare that scares us more than the rest of the world, where we feel we need to pay for a new alliance. The Ukraine war is not that. If you look at what the Biden administration has done, all the deals that are on the table or on security, there’s not a single guns for butter trade. In fact, every single trade war, every single tariff that the Trump administration put into place, the Biden administration has doubled and tripled down on, except for one. There has been a deal over aerospace with the Europeans, but that’s it. If anything, the Biden administration is far more anti-globalization than the Trump administration was, or at a minimum, it’s actually putting in the long term policy.
So even if the next president happens to be a strong globalist, they’re going to have to unwind eight years of anti-globalization sentiment that is now hardwired into American policy and another eight years under Obama of just complete strategic apathy. You’re not going to do that in four years. So we are talking, best case scenario if you want to be involved in a globalized system another six years before the Americans might belly up back to the table. By then, China will be gone. Until next time.
As the US attempts to reshore many previously outsourced industries, the Chinese are looking for any opportunity to retain their competitive edge…so let’s talk about solar panels.
China isn’t known for its grand technology or innovation, but through a mix of labor, security and scale, they have emerged as the dominant manufacturer of solar panels.
China’s not letting go of the reins anytime soon. So what will happen next…Industrial espionage? Technology theft? One way or another, the US is bringing solar home.
Prefer to read the transcript of the video?Click here
February is here and that means the Webinar is only 17 days away!
Join me on Feb. 17th for the webinar – Global Outlook: One Year into the Ukraine War. We’ll dive into the global impacts the war has had on supply chains, agriculture, and much more. After my presentation we’ll have a Q&A portion to answer all those burning questions.
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.
Hey Everybody. Peter Zeihan here coming at you from fairly windy and noisy Miami. I hope the sound on this one’s okay. The news that you can use this week is that the Chinese government is considering putting export bans on certain types of solar panel manufacturing, specifically the ability to make the wafers and silicon ingots that go into certain types of solar panels.
Some people are saying that this is a retaliation to things that the United States has done recently with semiconductors. But I don’t think there’s a direct link here. A couple of things. First of all, when you think of technology and you think of China, those two words only go together in the word manufacturing. The Chinese do not have a history and really any industry or subsector of being the innovators. They’ve got the manufacturing plant because it used a mix of labor and security and scale in order to become the dominant player in a lot of sectors…solar panels are one of those. But they don’t do much innovation at all. In fact, we were kind of racking our brains over this in the offices when what items out there were the Chinese the pioneers at, that they hold the technological edge, and there’s still a demand for it outside in the rest of the world. There is really nothing.
What’s going on here is that the Chinese have discovered that the United States is starting to build on an industrial policy and lots of other countries in the world are going with it. And once you marry state power to the efficiencies that you get from the American workforce and capital markets and market size, well, the Chinese just aren’t nearly as important in that sort of world.
So in those rare places where they do have a technical edge, they would like to keep it. This brings us to the solar panels. The Chinese dominated this space years ago and drove out most of the competition completely and then were left as the only ones in the space. Something like 80% of the global total and the assembly of solar panels requires a lot of fingers and eyes, something the Chinese dominate because of the size of the labor force. And that means they have made certain technological advances. The one that they’re talking about at the moment, the most important one by far, is that the Chinese and only the Chinese can make the wafers for the PV panels larger and thinner than anyone else. It’s an edge they would like to keep. But with the United States now mandating that a certain percentage or rising percentage of solar panels have to be manufactured in the United States. This technology is going to move there, whether it’s the U.S. having to develop it or not. So the question comes down to what kind of time frame are we talking about?
If the Americans started from a naked start, this would probably be a 5 to 8 year process, which for the Biden administration is just not fast enough. And so that brings us to the question of espionage. Now, the Americans, as a rule, are not great at industrial espionage, and it’s because our economy is too large and the government tends to be too hands off. So let’s say, for example, that the CIA did have the capacity to steal the plans for the next transmission that the Germans were able to put together. Who do you give it to? Ford? Chevy? Doesn’t work that way here because we would have to choose sides on everything. Our economy is too big. There just aren’t a lot of sectors where we only have one significant firm. But that’s not the case in most other systems where you have national champions, in part because of technology theft.
The three countries that would be most likely to go after this are three countries that after China are the biggest thieves of technology in the world, and that would be France, South Korea and Israel. And of those three, the South Koreans are definitely the ones to watch because they now have a fairly robust history of building industrial plants within the United States in order to meet whatever requirements the US government demands. So I can absolutely see a future where either the Biden administration breaks with longstanding policy and actually gets intelligence professionals involved in technology transfer against the wishes of the home country.
Or more likely, the South Koreans have already stolen stuff and they’re already negotiating with the Biden administration on how to build stuff on our side of the border in order to get the Koreans concessions and other economic sectors, which is something they would dearly love anyway.
One way or another, this is going to happen. The Biden administration has already put out the money. The demand is there. Solar panels are getting more efficient every year. They’re making more sense and more parts of the country. But most of all, most importantly, the political will for the general population to play hardball with the Chinese is there.
So all the pieces are in place and Chinese leadership in this sector, its days are numbered. And even if that proves to be false, if the Chinese refuse to export the tech to the United States, then the United States will have no choice but to build the stuff itself. One way or another solar panels are coming home.
An American, a Dutch, and a Japanese guy all walk into a bar…sounds like the beginning of a bad joke, right? Unfortunately for the Chinese, their semiconductors are on the shit end of this joke.
As the Japanese and Dutch join the US sanctions against Chinese Semiconductors, we find ourselves at a precarious crossroads. The semiconductor industry has long been the personification of globalization, with dozens of products crossing countless borders and supply chains longer than the DMV line. But what happens now?
China’s demography is collapsing, and its semiconductor industry isn’t far behind. So someone else will have to step up and start producing these semiconductors; all eyes are on the US, the Netherlands, and Japan. Although, we may have to put up with middle-of-the-road semiconductors for a while.
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.
Hey everyone. Peter Zeihan coming to you for a very, very chilly Colorado. It’s a balmy negative seven degrees Fahrenheit right now. It’s the 30th of January and the big news internationally is that the Dutch and the Japanese have decided to join the American sanctions package against China for high end semiconductors. Now, there has been a lot of talk about how when the United States goes alone, it’s a problem with semiconductors, it just encourages other people to build alternatives and use alternatives.
That is hideously wrong for two reasons. First of all, the nature of the semiconductor industry is more of an ecosystem. There’s very few places that, without significant industrial buildout, could even pretend to do more than two or three steps of it, much less the dozen or so steps that are necessary to make sorry it is really cold. Are going to go down another layer here.
For example, the lithography, the wafer, manufacturing, the design, these are all done in different places and the hardware is built in different places and it all has to be brought together. Semiconductors are globalization given physical form. The idea that you can shuttle multiple products among multiple borders at any time and have long involved technical supply chains operating without interruption, and that’s computing in general. But for semiconductors specifically, all of the hardware needs to get to the same location and order than build the semiconductors. So you need lithography machines, which are fancy lasers that come from the Netherlands. You need lenses from Germany, you need optics from California, need designs from Silicon Valley and Salt Lake City. And you need wafer systems that come from Japan and so on.
So you remove one country from this ecosystem and the whole thing falls apart. So that means that the United States, should it choose to go it alone, really can stick to the Chinese or anyone for that matter. But so can the Dutch. And so can the Japanese. And so can the Koreans. And so can the Taiwanese. It takes the family. So that’s kinda piece one. Piece Two, is there was really never any doubt that the Japanese and especially the Dutch were going to join in the sanctions. And I know, I know, I know people are like, oh, their bottom line comes from China and corporations are not the same as governments. Well, I’m sorry, but it’s just not that clean.
The issue is you have to look at the locations of these countries and what they need to be independent, much less to thrive. In the case of the Netherlands, they’re the runt in the neighborhood. They may be a powerful economy. They may be very high valuated and technologically advanced, but they’re sandwiched between the Germans, the French and the Brits. And while the Dutch have a reputation for being brusque and abrupt, everyone in Europe would rather deal with them than the Germans or the French or the Brits. And so they become the middlemen of the European system. That is a very awkward place to be from a security point of view, because you never know when someone’s going to throw a war and you might get inadvertently invited.
So the Dutch have always tried to find a friend who’s not on the continent in the short term. That has always been the Brits, but they prefer a bigger friend who is even further afield, who cares less about the minutia of European affairs and just tries to keep the war from happening in the first place. That since World War Two has always been the United States.
And you can argue that. I could argue I do argue, that the Dutch are among the top five most loyal nations to American security interests because the Dutch know they’re going to need the help back home. So as soon as the Biden administration announced their semiconductor sanctions back in October, talks started with not just the Dutch government, but ASML, which is the company that does the lithography. And they were cordial and they were cooperative. And we now have an agreement that very soon the Dutch will formally be joining the sanctions system against the Chinese.
Now, the Japanese are a slightly different story because Japan used to be a great power not all that long ago. If you remember World War Two. But as their demographics have decayed, more and more industry from Japan has offshored to other places, most notably the United States. They want to have the production in a place with a strong enough demography to actually consume the stuff that they build. That’s changed the nature of the relationship. It’s far more co-mingled now than we have ever had with the Japanese and the Japanese have ever had with anyone. And so under a previous government, the Shinzo Abe government, a trade negotiators were dispatched to Washington to basically seek a deal with the Trump administration.
And the deal they ended up getting was humiliating. But they realized that was the price of a strategic partnership that could stick. And then when Biden became president, all other trade deals that were struck by the Trump team, other countries tried to back out, most notably Canada. Mexico tried out to get away from some of the terms of NAFTA to the Japanese, made it very clear to the Biden administration that they were not going to be on that list. They were happy with the deal as it was. And the Japanese are now the only country that has been able to strike deals on trade and on security with both the Trump and the Biden administration’s. Same terms, which means that Japan’s already made its bed. It has already decided that it has to be part of the American network. And so when the sanctions came up against semiconductors to China in October, honestly, it didn’t take much arm twisting at all.
So the Chinese, when it comes to the mid to high end chips, are just out of the game now. They can’t make any of this work. They’re going to be buying as many chips as they can for as long as they can, but they’re just not going to be able to advance past where they are right now.
The only country that’s kind of on the outs that has not agreed to join the sanctions in any meaningful way at this point is Korea. And it’s easy to see why they’re in a tough spot. They’ve got Japan on one side, which has colonized them many times. They’ve got the Chinese on the other side, which is a huge neighbor. And their relationships are, in a word, complicated. And, of course, there’s the North Korean question. In many ways, South Korea today is a bit like the Europeans of the last 30 years, desperate for security issues, to not figure into trade relations because they know they’re in a tough neighborhood. And when things crack, it all goes to hell very quickly.
So now the United States really only has one country to focus on. And so all its diplomatic heft is going to be going and looking at the Koreans to try to get them on board as well. And they’re the last ones I would expect for them to join the system later this year as well.
Now, the nature of making semiconductors, so there’s dozens of different types, but you can kind of put them to three big buckets. Your top tier, the best ones. These are ten nanometer and smaller. This is typically what’s in your cell phone or in your high end computers and servers. Those about 80% of them are actually fabricated in Taiwan, with another 20% in South Korea. But again, you need the whole ecosystem to make it work or move one country. The whole thing falls apart. In the middle, you’ve got everything that goes from climate control systems to automotive to aerospace to machinery. Those are made in a host of places the United States, Taiwan, Korea, Japan, China, the Netherlands, a little bit in Britain and Germany as well. This still requires the ecosystem, but you could probably lose one player, probably not more than one player. And then you get your low end, your 90 nano meters and up. These are chips that are basically analog processors. They can do one little yes no equation, not much more than that. This is the Internet of Things. And this, for the most part, is centered in the Chinese system. Now, the Chinese are the only country that makes the 90 nanometer chips. And this is a low tech enough chip that the Chinese don’t need substantial help from the rest of the world in order to do it.
So we’re going into a really interesting phase here. I would argue that for reasons of energy and agriculture and security and trade and personality and politics, that the Chinese system is in its final years. It’s going to collapse this decade. And I would argue that the globalized system that allows the great good chips, the ten nanometer and better to exist, that perfect situation of trade with no friction that that’s going away.
What’s in the middle that is a little bit more forgiving in terms of supply chain. That’s what’s probably going to last. So we’re going to lose the really good chips and the really bad chips. And what’s in the middle is just what we’re going to have to make do with until we can have a significant industrial buildout in the countries that already have most of the remaining steps. And the Japanese, the Americans and the Dutch are going to be the center of all of that effort.
Alright. That’s it for me. I’m going to go warm up. Take care.
Today we answer the question that’s been in the back of everyone’s mind since The Terminator came out – is Skynet taking over? The short answer is no, but let me explain…
The AI capable of decision-making and judgment (i.e., Skynet) is nowhere near being ready to go, and won’t be for at least another 30+ years. On the other hand, applied AI (i.e., mission-specific and code-driven) is great at completing tasks as long as it’s written into its program.
So AI that’s used as a copywriter or chatbot is already up and running, but the omnipotent robots that hunt us down and try to take over the world…ya, not happening anytime soon.
The biggest takeaway is that change is coming, but not in the scary revolution type of way that we’ve been hearing about for 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.
Hey Everybody. Peter Zeihan here. We’ve had a lot of questions come in about AI and what that means for the workforce moving forward. What sort of activity should we expect to be replaced? What does this mean for economics and labor and politics and are there any obvious winners either in terms of geography or sectors? What popular when it comes in is whether or not this is going to hit red states or blue states more. For example, the cop out answer is we don’t really know yet because we’re dealing with technologies that have yet to be invented. But there are a few general guidelines we have.
First of all, it’s not so much that jobs get created or destroyed, it’s that they change. And it’s pretty common when you’re dealing with an environment that has evolved because of technology. You know, jobs evolve, too. We’ve been talking about technology overwhelming the workforce really since the onset of the Industrial Revolution, and it obviously generates changes. We don’t all live on subsistence farms anymore. The trick is whether or not the technology evolves faster than our political ability to adapt to the changing workforce conditions. And I would argue that at least at the moment, we’re nowhere near that.
I mean, yes, we’re dealing with the information revolution. And, yes, there is the possibility that’s going to replace a lot of jobs, increase productivity. The point that a lot of people just don’t have anything to do. But that’s all theoretical. Our experience in the last five years is, if anything, it’s going to be the opposite. You see the sort of things that IT revolutions do is they make it, it’s in the name information, information tech. It manipulates information at a faster rate, but that is not where the uneducated people in our society are. Most of the uneducated society, people in our society are in lower class, blue collar jobs. That is not something that AI can help with at all. That’s something that the advances we’ve seen in productivity are almost irrelevant. AI instead is taking away those low to mid skilled white collar jobs, which is not normally what we think of when we think about the sort of jobs that can be destroyed.
So we’ve actually, in the last three years since the greatest increase in take home pay for low skilled blue collar workers in over a century. And that has actually helped in the case of United States, narrow economic inequality to a degree that we have not seen since before the World Wars. So if anything, the theory is proving itself wrong rather than right.
However, if you’re, say, a copy editor or a secretary, well, you might have some really big problems because I already has been able to deal with those jobs in a more efficient manner. You just don’t need as many people. In fact, the blockchain, which is one of the things that undergirds crypto. Crypto is something that could be very transformative in things like health care. If you think about any doctor’s office you’ve been in, there’s that huge forest of staff in the back who are basically on the phone with the insurance agents every day, all day. Well, the whole idea of blockchain is that anyone who controls half of the pieces can grant others access. Well, in your health care records, that would be you. And if everything from that can be digitized, then that entire flood of low skilled white collar workers in the back of every doctor’s office and hospital simply goes away. So it’s probably not going to hit where we think it is. And it’s probably not a red versus blue thing, and it’s probably not a coastal versus interior thing. It’s a mid-levels of education versus the edges.
If you’re highly educated or low educated, you look fine from this. Second, there’s the issue of time. Now, obviously, these technologies continue moving, but there’s two reasons to expect that we’re going to have a lot more time to make this adaptation that I think a lot of people give it credit for. Number one is, as the baby boomers are retiring, which is happening right now, they are liquidating all of their investments and going into really boring stuff like T-bills and cash.
That’s not what funds I.T. startups. That’s not even what funds the big IT companies in Silicon Valley. For that, you need venture capital. You need a high velocity of money. Retirees are no good for that. And the whole world is aging very rapidly. And baby boomers are not a phenomenon limited to the United States. So we’re going to see the amount of capital just kind of seize up in the entire space.
At the same time, most of the world is running out of the 20 and the 30 somethings that are necessary to do the research and develop these technologies in the first place. So overall, we should expect the pace of technological evolution in the world to slow quite a bit in the two decades to come, compared to the two decades we’ve just completed.
Second, we’re not close to a general, a breakthrough. Let me explain what I mean by that. Artificial intelligence kind of falls into two general buckets. General A.I. is, you know, Skynet. The idea that the machine can actually look at a situation thing, come up with a potential solution and act on it, or nowhere close to that. I don’t know anyone, even Elon Musk, who thinks we’re going to be there before 2050. And this is before you consider that the amount of capital and workers that are available to develop these sort of things is in the process of drying up. So probably we’re looking at 2060, 2070 or beyond. We’re just we’re not even close.
The other type of AI is applied A.I. or mission specific A.I. and it’s not so much artificial intelligence in the way that we kind of have it on our heads. But it is machine learning, but it’s really more like machine programing. So you put in dozens, hundreds of thousands of if then statements into a program for it to execute. And as long as the conditions that are presented to the machine fall within the rubric of what you programed, you’re okay. But if you see something even a little out of context, the whole thing tends to fall apart.
So an example, let’s say you’re developing an A.I. driving program and you tell it what a stop sign looks like. What if the stop sign has a bumper sticker on it or graffiti, or if it’s on the side of a building as part of an ad. Applied to a I can’t recognize those other conditions. And if you kind of widen your parameters to make it a rounding error, then it’s going to make a very real mistakes in the very real world that any four year old could hit.
So if you need A.I. to do calculus, yes, they’re light years ahead of what we as humans can do right now. If you need it to make a decision based on a judgment call, they are still completely and utterly incompetent.
Alright. But let’s assume that some of this happens anyway. And so we’re going to have to deal with an A.I. system that is making decisions. What does that mean for the job industry?
So historically speaking, this is not the first time we’ve dealt with this issue. In fact, for those of you who remember your 1800s of political economic theory, good old Karl Marx, his whole idea was that the future of the proletariat was to take over from the capitalists, that once the industrial plant was built, then you could get rid of the bourgeoisie and the proletariat could live and do very, very well for itself because the machines and the industrial plant would be there to provide for everyone.
Well, folks, he was wrong then. He’s still wrong. Now, universal basic income is the idea that we live in such a world of plenty that we don’t need to work. But as we have seen in the last three or five years, if anything, the opposite is true. The productivity has stalled in part because of tech, but moreover, because we’ve discovered that as populations evolve in industrialization, we live longer, we have fewer kids. And that means after we urbanize five, six, seven, eight decades after, we’re actually running out of young people to do a lot of the lower skilled work. So if anything, Marx was completely wrong because the part of the population that he thought that would benefit the most from industrialization is at the current moment, actually not doing all that well.
The middle class, it’s the lower classes that are cleaning up right now. There are very, very few places in the United States at this point where if you were earning $15 an hour before COVID, you’re still in that bracket today. You’ve been able to leverage the fact that there’s a sharp labor shortage to move up, and that means you have a vested interest in the system.
And it means if you decide not work, there is no one who is willing to pay you to not work because there are jobs, jobs, jobs everywhere. So in conclusion, is AI real yes, but we’ve been thinking about it completely wrong. And most of the assessments that I have seen from almost everywhere are drawing the wrong conclusions when it comes to sociological outcomes.
It’s going to be important. It’s going to change who we are. It’s going to change how we live and how we work. But the word here is change. It’s not a revolution. All right. That’s it for me. I want to go get a snow shovel. Take care.
Disclaimer: The following newsletters were originally published in early 2021. As the newsletter continues to grow, I will occasionally re-share some of my older releases for the newer members of the audience.
The years of Donald Trump’s presidency are known far and wide. And the impact those 4 years had was…not small. The Trump-era of American politics has left the world with a number of questions, perhaps the most important being…what does life after Trump look like? Not just for Americans, but for everyone. This question is something still being discussed on the daily, and as the 2024 elections close in, we’ll continue to see the name Trump in the headlines for years to come.
I’m not sure precisely what I’m expecting to achieve with this series. Perhaps we’ll figure that out together.
Let me start of by saying that in an advanced democracy like the United States, political violence must never be tolerated. We have institutions and courts and elections expressly to manage our differences and debates. That isn’t simply how things are, that is how things should be. The ban on political violence is entrenched in both our norms and our laws and is the foundation of not simply our Constitution or our civilization, but of civilization itself. Anyone who encourages otherwise should rot.
Many have compared the events of the January 6 Capitol riots with the violence which occurred concurrently with the Black Lives Matter movement of 2020. The idea cannot simply be dismissed out of hand. But not being correct isn’t the same as being right. During the 2020 protests, some figures in national leadership encouraged people to do more than simply march, and cheerfully paid their bail after their arrests. AOC comes to mind. That is indeed crassly irresponsible. Damaging. Stupid.
But we expect different things from different people. We hold four-year-olds to different standards than college students, much less parents of four. That’s life.
So, while I am the polar opposite of impressed when folks like AOC engage in dubious political acts and grandstanding, I can’t say that I’m shocked or offended or mourning for the future of my country. I expect that sort of crap from young, first term Congresspeople and I weigh it against some of the less-than-wise things I did in my 20s. Yes, from time to time they besmirch their office and their place in history, but they are rabble-rousers. It’s their schtick. It isn’t like they are leaders.
In contrast, Trump is the president. He is the leader of the free world. The presidential standard is higher than the standard for a 31-year-old-until-recently-bartender-now-first-term-Congresswomen.
Even if the standard were the same, Trump has surrounded himself with people seeped in law & order conservatism and respect for American institutions like Reince Priebus, Sarah Huckabee Sanders, Rex Tillerson, James Mattis, John Kelly, Nikki Haley, and HR McMaster. Even folks on TeamTrump that I might personally disagree with more often – such as John Bolton, Jeff Sessions and Gary Cohn – are hardly what I would call fascists or anarchists. Even if you hate any or all these men and women on ideological grounds, you must admit that they are adults and that they realize spending a month of your time encouraging the most violent portions of American society to descend on the capital to lay siege to the Capital complex isn’t a good call. I have zero doubt that all of them warned Trump against similar actions on multiple occasions.
I have zero doubt such warnings were the proximate reasons all no longer serve in the White House.
It’s time we talk about a region that has long held the title of “worst demographics”…The Orthodox Christian countries.
The big dog of the region – Russia – has entered a point of no return for its demographic situation. Ukrainians are even worse off. Regardless of the outcome of this war – they’ll end up with a s*** stew of demographics.
Other countries like Bulgaria and Romania aren’t any better off. They’ve basically sent out all of their youth to other countries for economic opportunities…and even if they do return, they’re not adding to the population once they reach their 40s and 50s.
Serbia had the opportunity to flourish into the most rapidly growing economy in the region. Still, they’ve made every wrong policy decision in the book…so no dice for them either.
Each of these countries will likely come face-to-face with its inevitable demise within the next 20 years, and there’s not much they can do about it.
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.
Hey Everyone, Peter Zeihan here coming to you from snowy Colorado, where, as promised, we’re going to be talking about the next chunk of our demographic series, specifically talking about the Orthodox Christian world, which is a huge swath of territory stretching from Russia to Belarus and Ukraine and Moldova, Bulgaria, Romania and Serbia. Now, these countries have three characteristics in common that have really shaped their demographic destinies, and none of them have been great.
The first is broad scale economic dislocation. These were the parts of the former communist world that didn’t do well, even at the height of communism. They weren’t very advanced. And especially when the post-Cold War system erupted, they didn’t have anything really to contribute aside from raw commodities. Their industry was outdated. They weren’t producing steel like the Czech Republic or I.T., stuff like the Latvians. They were only doing grains and raw materials and energy. And you can get growth from that. You can get wealth from that, you can get infrastructure and development from that. But unless it is really, really well-managed, the population just doesn’t see a whole lot of it. So these countries were in and out of horrible recessions for really 30 years.
It’s less bad in places like Romania and Bulgaria because they did ultimately get into the EU in the late 2000s, but they were the last ones in line. Serbia took a kind of a double hit because they don’t have a lot of raw materials that they can export to the world. And in the aftermath of the NATO bombings in the Yugoslav wars in the early 1990s, Serbia never moved on. So even with the Russians under Putin going from win to win, in terms of global policy and generating a lot of income from oil in Serbia, there was a whole lot of nothing. And politics basically became locked down in the aftermath of the Yugoslav wars, and the country really was never able to advance to whatever is next. And that holds true even today.
Okay. What’s second because of the economic dislocation, because so many people didn’t see a lot of opportunity. You had huge immigration from all of these states, mostly to Western Europe, some to the United States and Canada in the cases of Romania and Bulgaria once they got into the EU. If anything, the outmigration accelerated because there were then fewer restrictions.
The Russians easily lost 10 million people in the 1990 and early 2000s to the wider world. And in the case of Moldova, perhaps as much as one quarter of the female population under age 50 left never to return, some of them going, a lot of them going into the sex trade because there really wasn’t a lot of an option because education in Moldova during the Soviet periods was even very low.
Serbia is probably the country that has suffered the most from this outmigration because again, the government just has never moved on and there’s never been a plan economically for what’s next.
The third one kind of flies under the radar and is probably going to piss a few people off. But here we are. Birth control in this region. The primary method is abortion.
So on average, more than seven out of ten pregnancies across this space are terminated. And if you have one abortion, I know I’m a dude. I really have no right to say this, but, you know, I’m going to go out on a limb and guess that it’s not critical to your health. But if you have ten, you’re probably endangering your future fertility.
So between a very low death rate, a very high abortion rate and very high infertility rates because of the weird intersection of health care and birth control and economic collapse, it’s arguable that a lot of these countries, probably Russia, right at the very top of that list, simply could not repopulate, even if the economic conditions were to turn around. So this is the part of the world that is duking it out with Northeast Asia for the lowest birth rates and the fastest national mortality, if that’s the right term in the world. So that’s kind of the overview.
Those are the three big issues that shape the region as a whole. But we do need to give additional attention to the Russians and the Ukrainians.
Now, the Russians have had a series of stacked geopolitical disasters World War One, World War Two, Stalin’s famines, Brezhnev’s mismanagement, Khrushchev’s mismanagement, and then the post-Cold War collapse. All these kind of stacked on each other. And so that the current generation that is now in their twenties is the smallest one they’ve ever had.
The Russians say they’ve got a metric ton of teenagers and that the demographic turn has been made and they’re going to be fine if they are telling the truth about that. That would be the only of their data that they’re telling the truth. More likely that we actually have fewer teenagers than 20 somethings. And you’ll see that in the demographic graphic that we’ve patched into the show.
More likely, their data is more similar to the situation in Ukraine. One more thing about the Russian demographics. They’re not equal. Just as in the United States, where places like Utah, Texas have higher birth rates in places like New York or Connecticut because they’re less urbanized or have different cultural norms. The same is true in Russia. Russia is not just Russian. The Russian state was originally founded in the area in Moscow, and they discovered that they really had no borders that were secure. So the way they decided to deal with that was to expand, conquer all their neighbors, consolidate and expand again, conquer all of those neighbors and so on and so on and so on until they get to the Russia that we more or less know today and during the Soviet period.
That means that there are dozens of conquered peoples living within the Russian system. Some of them have demographic stats that are just as bad as the Russians, but not all of them. A lot of the Turkic minorities, most notably the Chechens, the Dagestanis, the Basqueirs, and the Tatars actually have very robust demographic structures and are doing very well from a health and a growth point of view.
Well, the last decent number that we’ve got from the Russians was done by the 1989 Soviet Census. And at that point, the best guess – Soviet numbers, after all, was that 20% of the Russian population within the Russian Federation was non Russian. So 80% Russian, 20% non-Russian. Well folks, that was over 30 years ago. It’s probably closer to 25 to 30% today.
That’s non Russian. And if you fast forward another 20 years, you’re talking about probably 30 to 35%. Now these are all guesstimates upon guesstimates because this is Russia and getting good data is next to impossible even before there was a war. But we do know for sure that even if you include all of the minorities, the Russians, only have 8 million men aged 20 to 36 months from now.
At least a million of those are going to be committed to the war in Ukraine. We already have over 100,000 dead. We already have about a million who have fled the country. So one way or another, the Ukraine war is the last conventional war that the Russians are ever going to be able to fight because they simply won’t have enough people.
Now, the Ukrainians have no reason to lie about their demographic data, aside from the fact that it’s absolutely atrocious. And if you look at it and you look at just the collapse from the fifties to the forties to the thirties to the twenties, to the teens to kids, you’ll notice that this isn’t just a demographically spent country. This is a demographically dissolving country.
So unfortunately, even if the Ukrainians achieve runaway success in this war this year, it’s already too late. Even before the Russians started kidnaping children in the thousand, perhaps hundreds of thousands from Ukraine, this was a country that simply didn’t have enough people under age 40 to even theoretically repopulate themselves. So within 20 or 30 years, we are looking at the Ukrainian ethnicity vanishing from this world and probably the Russian ethnicity, no more than 20 or 30 years behind that.
Like I said, they are duking it out with Northeast Asia to see who vanishes faster, which means we have to turn to Northeast Asia next, because that is going to be the part of the world where from an economic point of view, these demographic turnings have the greatest impact. Okay, take care. Until next time.
After months of discussion, the Germans have opted to allow the Leopard Tanks to be sent into Ukraine…and while it may seem like this resolution took far too long, anyone that has read a history book can at least understand the reason for the delay.
There are two main factors to understand in this situation. First, the Leopards within the countries near Ukraine can get there and into the fight for the spring offensive. That’s huge. Second, the Germans put a clause into their policy that states the Americans must also provide some of their tanks – the Abrams. That one’s a bit more problematic.
The Abrams is less tank and more “armored weapons system” – and some of those systems are still classified. On top of that, just imagine all the heavy lifting required to create Abrams-specific logistics and service infrastructure stretching from the USA to Ukraine…it’ll be a while before those Abrams hit Ukrainian soil in any useful manner.
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Hey everybody Peter Zeihan here coming to you from a hotel room where I am in a hurry to get ready for a presentation. I have to be mic’d up in 20 minutes, so we’re just going to do this as we go. The big news on the 24th of January is that we seem to have a deal between the Germans and everybody else in the Western Alliance about the Germans providing leopard tanks to Ukraine.
Now, this is a main battle tank. It is the primary battle tank for most members of the NATO Alliance. It is obviously German made and there are export clauses that you can’t share your tanks, your leopards, with anyone unless the Germans give it the official approval that has been withheld until this moment. The Germans have been saying that they don’t want to be the ones taking the lead on this and they will only provide leopard 2s in the instances where the Americans provide the Abrams battle tanks, which are the American primary system.
It appears that there has been a compromise between the Scholz government of Germany and the Biden government of the United States to do some version of that. Now, there’s a few things here. First of all, why the Germans have been so hesitant. I don’t know if you know your history, but the last couple of hundred years of history has not been well, based on your point of view, it doesn’t necessarily put the Germans in the best light.
And so the idea that the Germans would ever, in a peaceful environment, decide that they should take a leadership position on military affairs is something that is antithetical, not just to the German population in general, but the government of Scholz specifically. His party is the Social Democrats and they have basically made their bones in geopolitics about making sure that Germany is never an offensive power at all.
Now the Ukraine war is forcing everyone to reassess what ideology shapes strategy and vice versa. But the idea I got to say, the idea that the Germans are beyond hesitant to be a leader in military and affairs in Europe and in the former Soviet Union. This is a really smart move. If the Germans just started providing weapons to one side or another in any war, regardless of what you think of the belligerence, I think we should all get a little bit nervous.
So while the Ukrainians are the ones who are paying the price for this reticence and I can understand why they’ve been upset to this point, you’ve got to admit, if you take an honest look at history, this is an a-okay situation. The second issue has to do with the Americans, specifically the Abrams tanks themselves. Now the leopard’s – they’re good hardware.
I’m not going to tell anyone that German engineering, especially when it comes to weapons systems, isn’t top notch. The Abrams should be more accurately thought of as the pinnacle of armored equipment development. This is a system that is not merely a tank. It’s a weapons system that has several integrated programs within it, some of which the Americans still consider top secret.
So anything that the United States sends from its arsenal is going to honestly have to be dumbed down a significant amount, and that is going to, at a minimum, take time. There’s also a question whether or not these weapons are going to be getting to the Ukrainians in any sort of reasonable time. Now, in the case of the leopards, there are over a dozen countries in Europe that use them. And everyone except for the Germans has been arguing for sending these things for weeks now. So the leopards can actually be on the front lines in Ukraine probably within two or three or four months, which means that can actually make a difference in the coming spring offensive, which will happen in May and June. And so from the Ukrainian point of view, that is absolutely essential.
Now, from the American point of view, that is equally essential and is part of the reason why the Biden administration to this point has not provided the Abrams, because it is not battle ready in that way. Even if the Biden administration could just turn them over tomorrow, which it honestly can’t. No one in Europe at the moment operates Abrams at all.
And because so many systems on the Abrams are cutting edge and have not been replicated anywhere else in any country, the maintenance and supply, the logistical tail that’s necessary to operate. Abrams doesn’t exist anywhere in the world except for in the United States itself. So the United States does have to build facilities in Europe, probably some in Germany, certainly some in Poland, which is in the process of purchasing some Abrams, but that is going to have to stretch all the way to Ukraine. And if you want to talk about something that might cross a red line or two with the Russians, a NATO logistical tail going all the way back to the continental United States for everything from arming to repairs, we’re going to do a lot of gray areas there.
But most importantly, the infrastructure does not yet exist. But for the leopards, it’s right there. Not only is Germany the manufacturer, it’s operated by Finland, and the Balts and Poland. All countries that border the conflict zone. So you can get leopards on the field of battle very, very quickly. ABRAMS Even if the training requirements were identical, which they are not.
You’re talking a minimum of a year, probably closer to three, to build out the physical support and infrastructure to get an appreciable number. Abrams In play now, there’s some people who are saying, you know, you know, by getting an Abrams into Ukraine, that is a vote of confidence in the Ukrainians. Absolutely. That is a signal that the United States is not going to quit.
Absolutely. Those are relevant conversation points. But an Abrams in theater without that support infrastructure is a target that the Russians will try to take out. You do not use an Abrams battle tank for a photo op. You use it to ruin someone else’s photo op. So do we have a political deal now to get Abrams into Ukraine? Sounds like it. That doesn’t mean they’re going to be on the battlefield anytime soon. And that’s okay.
