Foreign Policy Archives - Zeihan on Geopolitics

Relocate or Move On from the Middle East

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Following the dumpster fire that was the Iran war, the U.S. is contemplating how and where to redeploy forces to the Middle East.

Iran has demonstrated an increasingly capable drone arsenal, striking U.S. facilities across the region. So, can the U.S. just plop a couple bases in Jordan or Israel’s Negev Desert and call it a day?

Not exactly. The U.S. relies on the Patriot systems to shoot down Iranian drones, but there’s a scale problem. Iran can pump out thousands of drones in the time it takes the U.S. to make a dozen or so Patriots. That means that without creating a new interceptor, the U.S. is only buying itself a little time by moving its bases further away; eventually, even these new bases will fall within Iran’s range.

Hey, everybody. Peter Zeihan here, coming to you from Banff, Canada in Alberta. Today we’re going to talk about the American in progress plans to redeploy its forces throughout the Middle East. One of the many things that we saw as a result of the Iran war is that the Iranians now have a limited number of precision weapons. As we’ve been watching the Ukraine war, we’ve seen the accuracy in the reach of drone warfare extending incrementally ever since February, which is the same window that the Iran war happened in. And what we now have are a new type of drone that I call memory drones, where you can program in a limited decision tree, and when the drone gets to the general vicinity of its target, the pilot releases it and the drone looks at its targeting criteria, selects a target itself, and then goes in. And since the decision was made on board, it can’t be jammed at that point. It can only be shot down. And most of the damage that we have seen to U.S. military facilities in places like Kuwait and the UAE and Saudi Arabia were by these drones. And it’s not just that they hit the United States. They hit with extreme precision hitting, whether it was a barracks or a radar dome.

Anyway, bottom line is that the United States lacks a good defense for these systems. The Patriots are absolutely the preeminent system that the Americans have for shooting down those drones, and they’ll definitely do that. But the United States can only build about a dozen of those things a week. Whereas the Iranians can assemble several thousand drones per week. The math was always going to be against the US’s favor. So the discussion now is to where to move these facilities and the two countries that keep coming up over and over and over again are Jordan and Israel, where you’d probably put them in the Negev desert. And the theory is, you would put them outside of Iran’s range.

But no, there are multiple versions of the drones that the Iranians are using. But what we’ve seen in the Ukraine war is that the range gets incrementally longer every single day. The Ukrainians are now regularly striking targets that are over a thousand miles away from the Ukrainian space. And in the case of Iran, they’re nowhere near that long. But they’ve certainly breached 600. And 600 miles range can bring those Iranian drones all the way to the Mediterranean, hit anywhere in Israel already. So if the American goal is to have a close in military facility in the Persian Gulf region or the Middle East in general that can threaten Iran. The interceptor problem has to be solved. It isn’t an issue of distance. Iran has already demonstrated has robust capability of hitting anything in the region all the way to Israel, all the way to the Red sea, all the way to Yemen. Moving the bases isn’t going to change anything, except for maybe buy just a few months while the Iranians tick up their drone range just a little bit. And that’s all it would take, just a little bit. So no, this isn’t a good solution. So we’re probably going to be seeing a broad scale American withdrawal from the region unless and until the interceptor problem can be solved. And it will not be solved with Patriots.

A Post-American Alliance for the Middle East

Pakistan, Turkey, and Saudi Arabia are entertaining a NATO-style mutual defense pact. While this alliance might not be practical at this moment, it’s a much different conversation in the long run.

Hey, all. Peter Zeihan here, coming to you from Colorado. It is the 10th of August. And the new news is that over the weekend, representatives of Pakistan, Turkey and Saudi Arabia met in Mecca and basically tried to build the local equivalent of NATO, complete with a joint defense clause where an attack on one of them is an attack on all of them.

Obviously, Iran is the boogeyman in the room at the moment. So let’s talk about how this at this moment in time, is kind of silly, but if you look forward a few years actually makes a lot of sense. So first the silly. Saudi Arabia obviously has been heavily involved in the war with Iran and has had any number of his physical assets for oil production, transport and refining attacked. And it’s been partially flanked by the Houthis, which are basically an Iranian proxy. So there is no part of Saudi Arabia that is safe from the drone and missile attacks the Iranians have been lobbying these last six. The idea that they would want a security pact with a country that’s not the United States makes a lot of sense, because the United States started this war, prosecuted this war without any consultation with the Saudis, and now looks to be getting bored with the war and is likely to just leave. And Saudi Arabia has to figure out how to live with that.

On the other hand, you’ve got Pakistan and Turkey, which, while they don’t necessarily have friendly relations with Iran all the time. They don’t consider it a hostile state in the traditional sense. Yes, they’ve got some security issues. There are ethnic Kurds living in the border region between Turkey and Iran, and both sides try to stir up problems for the other one on the other side of the border. And the Baluchis are the problem on the border between Iran and Pakistan and basically the same math flows. But Iran and Pakistan don’t nearly have the kind of death grip on relations that the Saudis have. And anything from the Iranian point of view that gets anyone else collaborating with or with the United States is generally not a good thing.

The Iranians are a lot like the Russians, in that they may have a lot of power, but they’re certainly not able to dictate a solution. So keeping everybody else broken up makes sense. And this agreement certainly doesn’t work for that. But keep in mind that the other countries have other things going on that the others want nothing to do with.

So Iran is the issue of the moment. But, you know, if you’re in Pakistan, your only issue that matters is India and the Turks and the Saudis want nothing to do with a fight with India. And if you’re in Turkey, you’re either wrestling diplomatically and economically in culture with the Europeans or you’re getting ready for a fight with the Russians. And that is something the Saudis and the Pakistanis want nothing to do with either. So at this moment in history, the idea that this is a tripartite alliance where one of them will bleed for the other two is honestly kind of silly. And the Iranians have already kind of called it that. But if you step back a little bit and take the longer view, the picture changes.

Regardless of why the United States is removing itself from a lot of the Eastern Hemisphere. You can make the argument that I’ve been making for some time that for reasons of demographics and geopolitics, the U.S. is entering a more retrenched phase. You can look at what the Trump administration has done is basically spent most of our long range weapons making it almost impossible for us to fight a real war in the Eastern Hemisphere now.

Regardless of the cause, the United States’ position is the determinant of what happens in the Persian Gulf, is fading very, very rapidly and will probably collapse before the end of this administration, if not the end of this year. That reorders everything. One of the big things that people have forgotten about when they talk about globalization is it allows any local power to project economic and cultural influence on a global basis.

And if you’re a non minor power, like, say, Turkey or Pakistan or Saudi Arabia, that can have an outsized impact on everything. But if you remove the United States in its security guarantor position and its ability to keep the sea lanes safe for everybody, all of a sudden all of these secondary powers have to take care of their own neighborhood. And that forces a reshuffling of priorities domestically and internationally. And so if you look at these three countries, all three of them are Sunni. So there’s that’s a religious extraction of Islam. So there’s already a degree of a cultural link. Saudi Arabia is the world’s largest oil exporter. Turkey and Pakistan are importers. And if you look at the other places where these places might get their energy from, Pakistan might be able to get some from Southeast Asia. But in a deglobalizing world almost all of that crude can be consumed locally. The Turks can get crude from, say, Turkey. But as the Ukraine war continues to heat up in a globalized world, it’s only going to get hotter. All of a sudden that becomes less viable to.

So these three countries in the mid-term are going to be seeing closer and closer security and economic integration anyway. And the idea that today they are laying the groundwork for something that might actually resemble an alliance down the line. Well, we’re now going from pie in the sky to kind of common sense. It won’t work this year, probably won’t work next year, but by the time we get to 2030, we’re going to be in a very different environment, both in the Middle East specifically and in the wider world. And it’s interesting to see countries that have capability, like Pakistan, like Turkey, largest army and NATO like Saudi Arabia, already starting to prepare for a postAmerican world.

Leaving the World Behind: Obama vs. Trump

The Obama and Trump administrations have both made deals with Iran. There are some glaring differences between the two, so let’s see which deal came out on top.

Obama’s Joint Comprehensive Plan of Action (JCPOA) failed to address Iran’s missile program or its support for regional proxy groups, but limited Iran’s access to frozen assets, maintained broader sanctions, required inspections of nuclear facilities by the International Atomic Energy Agency, and sought to create a regional balance of power. Trump’s deal is substantially weaker, as it allows Iran to sell oil freely and access the U.S. financial system with limited oversight, lacks long-term safeguards on Iran’s nuclear program, and leaves Iran without a proper framework to engage with the region.

Hey everybody. Peter Zeihan here, coming to you from Colorado. Due to popular demand. I’m going to do today. Compare and contrast of an agreement called the JCPoA, which I don’t remember what it stands for now, but it was the Obama era deal with Iran versus what the Trump administration has just done. Let’s start with the review of JCPoA.

It is held up as kind of the landmark example of how to not negotiate with a difficult country like Iran. There were insufficient safeguards. Most of the issues that really mattered to the United States were not addressed. It was considered kind of the first stage of a series of negotiations to try to normalize relations with the Iranians. And as such, it was ultimately abandoned.

And most independent observers looking back on it now, ten years on, would give it a degrade in terms of its overall quality. So why is that? There are a number of things in the bilateral relationship that matter. Obviously, there’s a lot of things we disagree about, but near the top of the list are sectarian groups that are on sponsors to foment chaos throughout the region and its missile program, which is designed to not simply threaten Israel but ultimately broader American interests.

And in time, maybe even the United States and JCPoA addressed neither of those at all. But neither did the Trump administration. There’s not a single word about any of that in the very short napkin deal that Donald Trump put his name on so famously in Versailles. That’s piece one. Piece two is finance. The United States controls the global financial system, and almost all commodities are almost exclusively settled in US dollars.

That means the United States has eyes on any transaction that uses any dollars. And honestly, on almost all trade period. Because if you’ve got two countries that don’t have a lot in common executing a trade deal like say, I don’t know, Oman selling crude oil to Korea, the Omanis don’t have anyone and they don’t want anyone, and the Koreans don’t have any Omani dinars and they don’t want any.

And so what they do is they take their dinars. I think it’s called a really not sure offhand. Maybe I should have picked Mexico anyway. Exchange them for U.S. dollars on the international exchange, and then it goes back to one when it hits Korea. And in doing it that way, the United States actually gets two points of view on every individual transaction.

Anyway, Iran had been under a degree of sanctions for decades. And so the Obama team offered up progressive relief from sanctions in exchange for cooperation on the other big deal nuclear issues. And so to that end, the first stage was unlocking some of the cash as an act of goodwill that Iran and had frozen all these years came out to something like, I don’t remember the name or number off the top of my head.

No WiFi here about, let’s call it $20 billion. I think that’s about what it was anyway. 20 to 30. Anyway, that was loaded up into pallets and flown to Tehran, which is something that Obama’s critics screamed bloody murder. You’re flying cash pallets of cash. And the response, which was accurate, was that access to the financial system, which would have allowed Iran to sell its crude on the open market and get all the cash direct and use it for whatever it wants?

That would have required loosening up the sanctions in a way that the Obama team didn’t want to grant right off. That was probably for phase two or phase three or phase four. So the only option was to fly some of Iran’s cash. That was Iran’s. Anyway.

Anyway, it was an awkward deal that really had bad optics, but it was probably the best. Could it be done at the time? In contrast, the Trump deal just gives a very similar amount of cash in the 20 to $30 billion that is frozen directly to Iran in US dollars and grants them full access to the US financial system and allows Iran to sell whatever it wants to on the international market and earn US dollars that are not under US jurisdiction or monitoring or in any sort of temporary account, so we can watch where it’s spent.

It’s basically gave her on everything that’s been demanding since 1979. Which brings us to the nuclear question. That was the big achievement of the Obama deal. Is it committed Iran to IAEA inspections? IAEA is the UN bureau that monitors everybody’s nuclear power plants and makes sure that you’re not taking some of the fuel and turn it into what would go into a bomb.

The Trump deal does mention nukes, but it says it’s all subject to a 60 day deal, and there’s no restrictions on them at the moment. In addition, the Iranians felt that they wouldn’t be attacked because they had a nuclear program. Now they know they need to have a nuclear bomb to have a deterrent. So we’ve basically incentivized them to build a nuke.

Well, whereas the Obama deal, while there were multiple rounds and we were only in the first round, was definitely weak and insufficient and a bad deal. It’s nothing compared to the strategic abdication that the Trump administration has just done on financial and nuclear issues.

The core logic for the Obama deal, and you can you can argue with it, is that if you’re going to withdraw yourself from a broader region that you have been managing for decades. Unless you just want to let the chips fall where they may, you need to do one of two things. Number one, you have to appoint a deputy or a new regional hegemon to take your place, a country that you trust enough and that has enough capacity to hopefully do things more or less in the way that you would.

And There was no one. There is no one in the region that checks those boxes for the United States. Israel isn’t trusted, and besides, its power projection is limited in a sustained way. Sure, it can bomb someone, but it can’t hold territory except in Lebanon, Saudi Arabia. The military is a joke. Turkey is on the wrong side of Iraq.

There’s just no one. Which leaves us with option two. You have to set up a regional balance of power that self regulates so that the region’s problems stay the region’s problems. And that was the approach the Obama team seized upon. And that required a degree of normalization of Iran so it could act as a normal power. The Trump administration’s deal is basically a wash your hands and walk away and what happens, happens.

And so things like the war in Lebanon, things like the human rights disasters that are Saudi Arabia are the sponsors of terror, that are the Guthrie, Qatari, whatever. And everything Iran does in his infamous for just like it’s left.

So yeah, the Obama deal will go down as the quintessential example of a grade D statecraft, a horrible deal that didn’t take all that many American interests into account. But we’ve all been through school, and we all know there’s a grade below D, and that’s where we are now.

How to End American Power

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Trump’s latest statement telling countries to secure their own oil dismantles the very fabric of the global order. We’d be stepping away from the post-WWII system where the U.S. provided security for everyone, so economic growth could be the priority.

Forcing everyone to secure their own resources takes us back about a century, triggering conflicts and competition over resource control. This move weakens America’s global position, as power projection will be challenged and former allies turn into rivals.

This move jeopardizes America’s long-term strategic power and could lead to a collapse…comparable to the fall of the Soviet Union.

Hey, all Peter Zeihan here coming to you from Colorado. Today is the 31st of March, and we, we’re having some fun things. On Donald Trump’s truth social account. So the big news is that Trump has said, NATO is pretty much finished, and all of the countries that want crude from the Persian Gulf now need to come and get it themselves and just take it.

If you read the line which will print here, basically what he’s asking for is a return to the colonial era when each individual country maintained its own independent military forces, especially naval forces, and in doing so, looked after its own, economic issues.

The reason we do things today, the way we have been for the last 35 years, is we know that that model guarantees inter-state conflict. There’s two big layers to it. The first is that if you maintain colonies, you’re fighting to control those colonies. In the case of the Persian Gulf, this is actually probably one of the easier places to do it, because so much of the population is dependent upon physical infrastructure, like, say, desalination.

And so maintaining a degree of control is relatively manpower light versus the economic assets you get. You’ll have to manage those populations. You might have to move some of those population. You may have to kill a lot of those populations. But, from a purely technical point of view, it’s not too bad. The second problem is that everyone will have their own preferences as to where the resources go, i.e. home.

So you are guaranteeing a degree of inter-state conflict among the oil importers, because they will all now need to have their own naval forces in order to secure shipments from point of production in the Persian Gulf to points of consumption, primarily back in Europe or East Asia.

One of the things that really worked about globalization is we basically told everybody, you don’t need a military anymore because we will take care of that. So if you do maintain a military, it doesn’t need to be big. And if there is a fight, we will defend you and we will take full control of what military forces you do have.

And what that did is it cleared the board. And every major power in world history, with the exception of Russia, was now, for the first time, on the same side under the NATO flag or the American flag, based on where you were. And the United States basically made all the security decisions, with very little debate, I might add.

Moving away from that system to a situation where each individual power has their own military and is looking out for their own economic interests, is going to take us back to what we had roughly in 1930 when we were industrialized. And so everyone realized they needed crude oil.

But now, with a whole new layer of technologies and things like drones, it’s difficult to overstate how much of a tidal shift this is, because American military power for the last 75 years has been based on the concept or the sole decision making. We’re the sole arbiter, and what we say goes, what Trump is now doing is deliberately forcing all of the allies to establish an independent military posture with independent military forces to look after their independent economic needs, because he doesn’t want to do it himself, said so very, very explicitly.

In that world, we will have taken every major power in world history that still exists today and forced them to move away from the American umbrella and to set up their own independent system. And no matter what version the future holds, we are never going to see eye to eye with all of them in that sort of scenario.

What part of what made globalization work part of it for the American alliance system work is we removed the military side of the equation from their thinking so they could focus entirely on the economic. And if you want to undo that deal, that’s, you know, there’s a conversation to be had there, but abrogated in this way and basically forcing everybody to take up arms for their own economic issues.

It’s turning the clock back to the weakest American security has ever been. And that’s in the 1930s. So the situation we have now is we’re not simply guaranteeing more colonial conflicts. We’re not simply guaranteeing more inter-state conflicts. We’re guaranteeing the fastest reduction in American strategic power in our lifetimes and arguably in the history of the Republic. Because while the US military may be first and foremost in the world, especially when it comes to the Navy deliberately ending the basing agreements, deliberately fostering demanding competition is going to land us in a world of hurt.

Ten, 20, 30, 40, 50 years from now. And we’re only now in the early second year of this administration. There is a lot of time to make this truth social post, which Trump deeply believes is the right thing. There’s a lot of time to make it stick. And if you look at what has happened in the last year with Donald Trump threatening invasion of NATO allies because he couldn’t get a chunk of ice, I’m concerned that we’re already well past the point of no return, and we’re now in a situation where the US military has to figure out how to close down its entire constellation of bases on a global basis and start building contingency plans for fights with all of the countries that have been on our side for the last 75 years, at a minimum, best case scenario, none of those fights happen, but it still means a massive reduction in America’s military global footprint and its ability to project power beyond the Western Hemisphere. So we are at the beginning of the greatest collapse in strategic power that I have seen in my life, the only similar situation that comes even remotely close would be the Soviet collapse, at the end of the Cold War.

But if you look at the Soviet empire at that time, it was not nearly as global. What the United States has now. Most of their retreats were far closer to home, say the loss of Central Europe, for example, we’re looking here at the United States becoming unwelcome, not just in the Middle East, but in Europe and probably in East Asia.

And we’re actively pushing to create strategic competitors for a generation or two from now. That is quite possibly the most fucking stupid thing that we could do. And yet here, here we are.

How to Break Iran

A ripped grungy back wall of the Iranian flag

If the U.S. wants to force a meaningful change in Iran’s government, there’s only one path forward. They have to destabilize the Islamic Revolutionary Guard Corps (IRGC).

The IRGC has become the center of power in Iran. While leadership is divided into three groups, the IRGC is the military-economic network that controls industry and enforces domestic control. Given Iran’s fragmentation and ethnic diversity, internal stability is essential. Should the IRGC’s revenue streams fall in the war, internal fractures would form.

If the younger members begin seeking power over the older elites who control the wealth, a civil conflict would erupt. Of course, it would be extremely destabilizing not only for Iran but also for the region.

Hey, all. Peter Zeihan here coming to you from Colorado. Sorry. Fever broke last night, so I’m better, but I’m still kind of weak. Where was I? Most of our coverage of the Iran war at this point is about what’s been blowing up the energy side of things. Strait of Hormuz, all that good stuff. Today, I wanted to go a different direction and talk about what might, might, might change in Iran that would end the war the way the United States would be really excited about, what I’m going to say isn’t necessarily how it’s going to go, but if we are going to break the Iranian government, it’ll look like this.

So the Iranian government basically has three big chunks that matter. First, you’ve got your supreme leader and surrounding the supreme leader are all of the people who are in charge of the guns and the overall strategy. So the intelligence minister, the defense minister, the people who are in charge of the IRGC, that is the Islamic Revolutionary Guard Corps, which is a militia that controls most of the day to day operations and, the country and among these groups controls all of their overseas assets and their influences throughout the Middle East, whether that is militants in Syria, Hezbollah, Shia in Iraq or what have you. A lot of these people, at least at the top, have now been killed. The Supreme leader’s gone. The new Supreme leader was selected, but his parents is one of his kids, and his wife has been killed.

The defense minister has been killed. And on and on and on. It’s not that this group is not functional, but it means that they’ve handed power down to the IRGC. More on them in a minute. The second group are the political and economic leadership that run the day to day operations of the country. The president, for example, the economics minister, the energy minister.

For the most part, these people have not been targeted by the Americans and the Israelis because they’re not responsible for most of the policies that the Americans and the Israelis find problematic. So when you see Iran going up and mucking up the region, these aren’t the people responsible. These are the people, for the most part, stay at home.

And they’ve been mostly left alone. But then you’ve got the IRGC, and that’s very different. A couple things to keep in mind. Number one, Iran is not a normal country. It’s all mountainous. And in each mountain valley you have a different ethnicity. And so how the Persians came to control this territory is they expanded out of their original mountain home in Persepolis and then went to the next valley over and conquered and intermingled with those people, and then to a third and a fourth and a fifth, and eventually did that a thousand times.

So when people talk about the thousand nations of Persia, they’re not exaggerating. This is a multi-ethnic society that has been trying to slowly grind its minorities into amalgamation for several thousand years, and today they’re only about half completed. Only 51% of Iranians identify as Persians. Now all the others still identify as Iranian. I’m not suggesting that there’s like a really robust opportunity here for multiple fifth columns, but it does shape the decision making, and it’s pretty clear that it’s the Persians who are in control of all the major decisions, especially the IRGC, the IRGC, plus the military.

Its primary job is to make sure that 49% of the population who are not Persian never get persnickety and rise up. So in many cases, the Iranian military force is primarily designed to occupy its own country.

All right. That’s the background you need for us to get into the real stuff. Now let’s talk about what can happen. The clerical class that is part of those first two categories, the supreme leader chunk and the more technocratic chunk.

That’s 10,000 people. And so if you wanted to destroy the political system of a country, that’s a lot of folks that you have to drop bombs on. And undoubtedly we’ve managed to do so for, for at least a couple hundred that were at the top. But there are always going to be more people waiting in the wings to step up and get into the big chair, even during a war.

So grinding through that entire class, which was basically would be a religious war, going after all the priests, is something that just really isn’t viable unless you’re going to put 1 million or 2 million troops on the ground in Iran to go through a country that’s twice the size of Texas with three times the population and root out each individual one, not really viable.

And then there’s the IRGC links to the clerical class, but more generally not of the clerical class. These are people about a quarter of a million to a half a million strong, based on whose numbers you’re using, who are also responsible for domestic pacification.

So whenever there is an uprising the IRGC comes in and starts shooting people. They also have very good relations with, say, the Syrians and especially the Russians. And so the Russians provide them with technology to track down people who are using cell phones or Starlink and basically get them in their homes and then remove them from the equation. Not nice people, but where there might might be a weakness in the IRGC model, it’s not in the guns.

Then the money. IRGC is self-funding. They control broad swaths of the Iranian economy from energy projects that they have forced private sector players out to the electricity system, which they control half of, to any sort of smuggled good. And since Iran is one of the most sanctioned countries in history, pretty much anything that is imported is smuggled at some level.

And that means that they have a vast array of income streams that add up to the tens of billions of dollars every year, and that money train is what entices people to join the IRGC. So today, we’re in a position where the senior political leadership around the supreme leader has been neutered or is at least in hiding. And the IRGC, in many ways, is the face of the regime now, because power devolve down to them, because they control a lot of military assets, including the missile program, the nuclear program, the shadow program.

And so when they see their interests get hit, waves of shitheads come out. So if you remember last week, Israel bombed part of a facility called the South Pars natural gas field, which is where the country gets the 70% of their natural gas. That natural gas is used to make power that hit the IRGC directly.

So they sent out 50 different attacks into various places across the entire region, and in doing so, made it very clear that they were perfectly willing to burn down all the energy infrastructure in the region if their economic interests are hurt. But if you really do want to change the government, you have to break the IRGC. Now, since there’s over a quarter of a million of them, there’s no way, even with a ground invasion, that you’re going to go in there and root them all out.

So you have to change the economic math here. It’s a generational issue. Ever since the Shah fell back in 79, there has been a baby bust and a consolidation of power among the people who were alive before that. And so we’ve seen the leadership of Iran, as a rule, get over and over and over.

That doesn’t mean that there aren’t young people there just fewer young people than there are old people. And how the demographic issue is playing out with the IRGC is you have a lot of people in their 20s and 30s and maybe even into their 40s that have never really tasted power, and they see their elders absorbing most of the profits from the smuggling and the energy in the electricity sector and construction and everything else. And they’re beginning to wonder with the war, when is my time?

Well, if the IRGC economic aspects get crushed in the war, then you might be able to generate this sort of uprising from within the Corps itself with the younger folks, the Young Turks, if you will, going against the older folks at the moment. That is the only path forward that I see where the United States might actually be able to change the regime in the country, forcing basically a civil war in the IRGC itself.

It would not be easy. And every time you go after the IRGC economic assets, you know, they’re going to hit the economic assets of the broader Gulf. But at this point, we have at least another 4 or 5 weeks of the war before the batch of Marines that are coming in from California arrive. And in that time, we’re probably going to lose most of that anyway.

So we’re already talking about the Persian Gulf being removed from the mechanics of global economics permanently. The question is whether or not you want to also try as part of that process to remove the IRGC. It’s an ugly way to do it, but at the moment, it’s the only real weakness in the way that Iran is set up that I think might be able to be exploited.

The Shield of the Americas

Silhouetted soldier against a black background

Trump has launched a new regional security initiative called the Shield of the Americas. This partners with several Latin American leaders that Trump likes to target drug cartels throughout LATAM.

The U.S. would utilize special forces and intelligence teams to carry this out. While they could target cartel leaders, labs, and trafficking nodes, as long as there is demand in the North, the drug trade will persist.

Eliminating the industry would require massive troop commitments, resulting in significant political consequences. And even then, the drugs would find a way to keep flowing.

Hey, everybody, Peter Zeihan here. Coming to you from Colorado. And today we’re going to talk about what went down to the white House over the weekend.

Specifically, there’s this new grouping called shield of the Americas that Donald Trump has initiated between the United States and a number of Latin American countries that he considers ideological allies. So, by the way, that the Latin Americans use the term further to the right, so not including Colombia or Brazil, but concluding places like El Salvador or Trinidad and Tobago or Argentina.

Keep in mind that what means left and right in Latin America is a little bit different from what it means here in the United States, but the Trump administration has not picked up on that. Bygones. Second that to all of these governments, just like any other democracy, switch back and forth. So this is an alliance, an alignment of the moment.

And first thing, you should not count on the current roster of countries being what is there tomorrow or the next day, or much less the day after. There are always elections going on. We won Columbia this summer. That is probably going to be quite significant.

And so the roster moves. But what is more important about the Shield of Americas, is not so much the Secretariat or any idea of policy. There’s no talk of trade deals. It’s all all about security cooperation. And the idea is that the Trump administration has decided it wants to take the U.S. military, push it into Latin America specifically to go after drug smuggling organizations. Now, back story. Historically speaking, the United States involvement in Latin America has been somewhat limited unless there is a third party from out of hemisphere operating the whole concept of the Monroe Doctrine is it’s not so much that this is our hemisphere, but it’s certainly not your hemisphere.

So whether it was the Germans or the Soviets or the Chinese or whatever, there’s always been a degree of built in American hostility to anyone on the outside pushing in here. That doesn’t necessarily mean that the United States is dominant economically, although there are periods in the history where that has happened. Second, with the United States is in the process, independent of Trump, exemplified by Trump of contracting its footprint and its interests in the Eastern Hemisphere.

Now we can have a conversation of whether that’s smart or not, but politically, it’s very popular on both sides of the aisle to bring the boys home and to be less involved in trade on a global basis. I would argue that’s mostly self-defeating, and guarantees will get drawn into something bigger later. But, you know, I’m only one guy.

If 330 million of us, my vote isn’t all that big. What it does mean, however, is that if you take the United States military and all of a sudden it’s not obsessed with the Eastern Hemisphere, and a lot of the forces come home, and of course, it’s going to be used more aggressively in the Western Hemisphere. And since there’s no country in the Western Hemisphere that’s even remotely capable of fielding a force that is of any conventional threat to the United States, then the question is, what are you going to use the tools for?

They may have been designed for Islamic fundamentalism or the Chinese army or whatever it happened to be, but if they’re here, they’re going to be applied to different threats. And the threat of international drug trafficking organizations is obviously a significant one that everyone agrees is a problem. We just all agree on what to do with it. I would argue that the simple way to destroy all of these organizations overnight is just just not do cocaine.

But again, I’m only one vote of 330 million. So we now have the Trump administration and at least 14 other governments, at least on the surface, agreeing to deploy American forces throughout the hemisphere to combat these cartels. Now, two things. Number one, as I said originally, the roster is going to change. And so you’re going to see a lot of small bases and coordination facilities popping up and then going away after an election and then popping up again after the next election.

And that means we’re not talking about a regular army, and probably not even the Marines, because the type of permanent footprint that’s necessary for those two institutions is in the billions of dollars of investment. And you can’t just come and go and come and go and expect it to be useful at all. It takes months to deploy the Army in a meaningful way.

Marines a little bit faster, but not by a lot. This is not a job for the Navy and aircraft carriers. This is much more specific. Once you limit what you can do with bases, and that means facilities that are small. And then if they get folded up tomorrow, it’s no big deal. Which means that the entire American deployment for this sort of thing is going to be special forces, whether it is the Green Berets or the Rangers or the Seals or the CIA.

Now that community, the Special Forces community, has more than doubled the number of operators they’ve had as an outcome of the war on terror, because you never knew where you needed to drop in a small team of a dozen people. Now that the war on terror is over, I don’t want to say that the Special Forces Command has nothing to do, but they’ve gone from having a long grading war where they’ve been working in tandem with over 100,000 Americans deployed in combat situations, throughout the Middle East to all of a sudden that’s gone.

And so they have become the premier force for the American president, whoever that happens to be, to address whatever issue happens to be coming up in the world or to a degree, deniable, they’re small, they’re agile, they’re lethal, they’re very skilled. They have a long logistical tail. But that means that at the point of the spear is a lot of force behind it.

So when you look at things like Latin America, you think of drug cartels. This is really the perfect tool for the job, independent of the fact that it’s twice as big as it used to be. It depends on the fact that they’re actually very good at what they do. The only problem, and it’s not a really big one from my point of view, is that they’ve been training for something else for 25 years now.

There’s not a lot of desert territory in Latin America where there’s drug trafficking. You’re talking primarily mountains. You’re talking primarily jungle or jungle mountains. That means we’re probably going to be seeing the teams deployed throughout the length and the breadth of the region. The question and only Donald Trump can answer this question right now is whether or not you’re going to deploy them exclusively in places where you have a degree of political cover and agreement with the host country.

In a place like El Salvador, pretty easy. El Salvador is not a major drug trafficking location in places like Colombia, where the government is currently kind of hostile. That’s a different question. As a rule, when Latin American countries realize they have a cartel problem, they’re usually pretty enthusiastic about working with the United States on security matters. But it’s always been a step of remove.

So, for example, if you look at Plan Colombia, which was the deal we cut with the Colombians in the early 2000, we shipped a lot of equipment, we provided a lot of Intel work. We provided some naval support, but it was always Colombian boots on the ground doing the actual grunt work. And in doing so, it ended their Civil War and led to a collapse in cocaine production.

You’re not going to do that with ten special forces teams. You can go after specific nodes. You can go after specific production sites, you can go after specific people. But we’re talking about an industry here. The drug industry gets tens of billions of dollars. And as long as there’s demand north of the border in the United States for these products, special forces are not going to be able to change the math to a huge degree.

That’s the second problem. The third problem is really much bigger. And that’s Mexico, in Mexico, with the current government in Colombia. Shame bomb. We have a government that is much more willing to work with the United States, even in the United States, as being a bully. But you’re talking about where the cartels, the big ones, originated.

And while they are in the process of fracturing because their leaderships have been removed, all of the economics that are still pushing the cocaine north are still there. And so you’re talking about having to do something like not special forces, but actually deploying tens of thousands of troops in order to impose a security reality. Here’s the thing. We’ve tried that if you go back to the Afghan war, at its height, we had 90,000 troops there.

And while they were trying to hold the country together to fight the war on terror, heroin production increased. Because you can only be so many places once Mexico is over twice the size of Afghanistan, Mexico has over twice the population of Afghanistan. And so even if we were to put a couple hundred thousand troops in Mexico, I really doubt it would be enough to change the overall economics of drugs.

Anyway, bottom line of all of this is, while the United States can’t solve these problems, as long as there is an insatiable source of narcotics demand, it does have some tools that allow it to interfere in the region in a really deep piercing, meaningful way. The question is whether or not the political and economic side effects of that are worth the perceived benefits.

Mild disruption of cocaine production, transiting versus breaking the political relationship that allows, say, the trade relationship to happen. Because Mexico is by far our largest trading partner and will be for the remainder of my life, and without them in the American trading network, everything we need to do gets a lot more difficult.

The End of U.S. Military Deployments?

A group of Marines loading into the back of a C-130 aircraft

Just because the US intervened in Venezuela doesn’t mean that America will be abandoning its global military posture.

The US maintains military deployments in Japan, Germany, and South Korea. Don’t think of this as imperial overreach; think of it as a low-cost force multiplier that prevents bloodier conflicts down the road. Should the US withdraw from these positions, things would likely get ugly…and quick.

The US is the only country with the ability to project power globally, and these optimally-sized deployments help extend that reach.

Hey everybody. Peter Zeihan here. Coming to you from Colorado, avoiding the crazy winds out there. Through with you inside. We’re taking questions from the Patreon crowd about the Venezuelan intervention and the rest of Nicolas Maduro, the former current. I’m not sure how that works out now. Venezuelan president. Anyway, he’s going to go in jail. We’ll never hear from him again.

The question is, is, is this a prelude to a general disengagement from the Eastern Hemisphere and closing down all the bases we have there? He’s like, oh, let’s let’s not get ahead of ourselves. First things first. The United States currently has fewer troops stationed abroad than at any time since the since World War two. We had a surge with the war on terror.

We’re back down to a pre, like the lows that we had in the early 2000. And it’s important to understand that the United States footprint globally is actually quite limited. Right now we have about, let’s called 100,000 troops abroad. Most of those are concentrated in three areas. You’ve got the largest contingent, which is in Japan. The second largest. which is in Germany and the third largest, which is in Korea, especially closer to the DMZ. All of these serve as force multipliers for the United States. Everything else is a very small contingent, maybe a naval base here and there that has a few hundred to a couple thousand people that are basically there to help the carriers operate.

But the way World War Two ended, we already have places like midway, for example, which is U.S. territory or access to the United Kingdom, which has their own naval bases that we just kind of rent. And so the, the need for the United States to maintain a far flung Imperial style military deployment just doesn’t exist. If you see the United States back away from the deployments we do have, it means that we have made a very clear strategic decision as a country to foment a war and so that we can participate in the next one.

And lose a few tens to hundreds, thousands of troops. So, for example, if we walk away from Japan, Japan is the anchor. And because of the way that the islands in the Pacific are position, it means that we basically give up the ability to influence the Asian mainland and the western third of the Pacific, which includes Japan and Korea and Taiwan and China and Singapore and Indonesia and Australia.

And if we decide to walk away from that, we’re basically saying that this whole area can evolve on its own, maybe generate a new hegemon, that we will then have to come back and deal with decades from now, basically setting up something similar to the rise of Japan in World War two. If we walk away from Germany.

Oh my God. Oh, God. Okay, so every time the Germans are responsible for making their own decisions, they start acting like a country or something. And as a large country, the largest of the European states by population, economy set in the middle of the continent, it will naturally try to influence the areas around it. And that is exactly what set everybody on the course to World War One and World War Two.

And so to do that deliberately, to set up a repeat of the world wars in Europe, strikes me as something that would not be in American interest. And that’s before you consider the fact that the Russians have been pointing nukes at US my entire life, and I’m now 50, 52 birthday coming up. That strikes me as immensely unwise.

One for the low, low cost of 30,000 troops stationed in bases that are nowhere near a front line. You can basically control the strategic destiny of a continent that’s cheap. Third, Korea, you draw those troops back. Forget about the likelihood of a war in the peninsula, which is would be very likely at that point. North Korea has nukes pointing at us, with the range to reach us.

So your permanently now putting Minneapolis, Denver, San Francisco, Los Angeles under a nuclear threat and defending against that would require an order of magnitude more cost, than simply maintaining 20 to 25,000 troops on the Korean Peninsula. So really, the three big deployments we have right now are there for very good reasons, mostly in terms of controlling the strategic environment, and because not having them there would require us to take a defensive position in our hemisphere, which would be extraordinarily more expensive and set up the situation for war down the road.

Okay, so that’s the United States. Now let’s talk about everybody else’s deployments.

Okay. That’s all of them. Here’s the thing that most people forget. Deploying troops in the thousands, much less tens of thousands a continent away, is very difficult, requires specialized logistics and decades of practice and infrastructure development. And so we are the only ones in the modern era that does that. The last time any countries did it at scale, it was before World War Two when we had the Japanese Empire, which we, to be perfectly honest, modeled some of our stuff, and the British Empire, which of course we modeled some of our stuff off besides that in the modern era, and nobody does it now.

Part of this is policy. The whole idea of the Cold War globalized system was that we will pay to create a world that keeps you safe is an exchange. You allow us to write your security policies. And that has been the basis of the American alliance going back to 1946. But the other part is just the sheer expense.

By creating a globalized system, we gave everyone access to the globe and all the economic goodies that come from that. And trade and access to commodities and markets the world over. And they didn’t have to have the military for it. So most of them never even bothered to try. And so the world’s second and third largest navies are the Japanese and the Brits, both of which work hand in glove with the United States.

And if we decided to withdraw from the Eastern Hemisphere, those two countries, as well as a number of others, would have no choice but to develop that capacity. Now, they wouldn’t do it in two years or five years. This is a generational thing, but eventually we’d have a half a dozen navies that had regional, maybe even global reach, and it would look a lot like 1929.

I would argue that’s something that we don’t want to do, because doing it the first time was really expensive in men and lives in the United States honestly got off cheap because it was most of the fighting was over there rather than over here. Okay, let’s talk about the the big countries, more specifically China. People keep pointing to the fact that they’ve got a large Navy unit, and they do and they do have about, 50 ships that are capable of operating more than 600km from the shore.

But even if you ignore the first island chain, which really hems them in, that doesn’t give them very much, because the Chinese don’t have basing rights in places that are useful to them. So when you look at the United States, we’ve got Japan’s second most powerful naval power on the world. Where we stage ships, we have midway, we have places that are allied in the North Atlantic basin, whether it happens to be Italy or Spain or the United Kingdom or Iceland.

We have global power projection, in part because of our territories and in part because of our allies. The Chinese have no allies, so they’ve gone out trying to build what they call a string of pearls model, where they develop friendly ports along the route that they want. And so they get along okay with Malaysia. They basically bought Cambodia.

And even though it has a coastline, they’re trying to build port there. They’ve got some friendly relations with Bangladesh and Myanmar, Sri Lanka and Pakistan. And so the idea is they can use their short haul ships to hop from base to base to get all the way to the Persian Gulf, where they, where the oil is.

And of course, everybody, because of pirate reasons, has a small base in Djibouti. But here’s the thing. If one of those gets broken in a hot war, every ship west of that is lost. The Chinese have tried to do it on the cheap, and that means it’s really easy to unravel. And so even if the United States were to find its vessels, say, stuck in the Indian Ocean, they have enough range to get out.

The Chinese don’t. And so I’ve never really been worried about the Chinese naval build out. Let’s talk about the Russians. The Russians aren’t a naval power. They’re not an air power. They’re losing their space capability. Within a decade. Pretty much everything that they have that’s not ground base is going to be gone. They just lost the manufacturing base to maintain it, much less expand it.

But they still have a large army, over a million men under arms. And every month, they’re bringing them another 20 to 40,000 men into the fight. That’s awful. If you’re on Russia’s border. And that’s the situation that the Ukrainians are struggling with right now. But if you’re not on Russia’s border, it’s actually not all that bad because you have standoff distance where you can use drones and air power.

If you’re another country back, you know, you really don’t have to worry about the tanks coming either. By the way, the Russians have almost run out of tanks, which is crazy. They started this war with 20,000 armored vehicles. They’re down to probably less than a quarter of that now anyway. Bottom line is that their their exposure is huge, but their ability to push back that exposure is very, very limited.

And their ability to use naval forces to protect power is basically zero. Now, they still have a handful of ships, but they’re split into four different bodies of water the Black Sea, where they can’t get past Istanbul unless the Turks allow them, and everything that does get passes. Relations with the Turks go south. That’s lost. They’ve got the Baltic Sea, but that is now completely a NATO lake.

At this point they’ve got the Arctic Sea, which is their their most powerful fleet is up there. But the problem is it’s a long way from anywhere. And they have to get by Norway and Iceland and Scotland and the United Kingdom, the United States, all of which are superior naval powers on that, but one that Iceland doesn’t have a military.

But everybody else could probably do it by themselves at this point, even without the United States. And then they have the Pacific Fleet that is based off of, Petrobras, which is basically a city you can only fly to on the peninsula. And of course, the Japanese are there. They could potentially be some things in the code Vladivostok, but that is literally surrounded by Japan, world’s second most powerful navy.

And even if all of the Russian ships were in the same place, the Japanese could still easily take them out because they’ve done that before. So the ability of the United States to project power is huge, in part because of its geography, but also because of its allies. The Chinese are blocked in by geography, the Russians are blocked in by geography, and neither of them have allies.

So we’re in this weird situation where the United States is considering a full scale withdrawal from everything, which will guarantee higher defense costs and longer, long term security challenges. This is one of the things that the people who are really pro isolation tend to miss the the footprint that we have right now is almost perfectly optimized to not have to spend money or lives.

As an added benefit, you also get to control the security architecture a huge part of the planet. You pull back all that goes away.

US Foreign Policy After Trump

Flags of multiple countries blowing in the wind

Trying to figure out what foreign policy will look like after Trump is a fool’s errand. With no strategic consensus or institutional planning capacity, the US is stuck in a car without brakes, a driver, or a steering wheel.

The US is undergoing a historic demographic transition, but the political realm hasn’t adjusted to this new reality. The bipartisan foreign policy framework that’s been in place since the 40s has collapsed. Trump has dismantled the Republican Party. Democrats lack coherent leadership. Key planning institutions have been gutted. Yikes.

The US is entering a volatile period where foreign policy is driven by instinct or ideology rather than strategy.

Hey all Peter Zeihan here coming from Colorado. Today we’re taking a question from the Patreon page. And it’s specifically, And I quote, foreign policy under the Trump administration is little, what’s going to happen after Trump? I would love to have a clear answer for you, but I don’t, A couple things to keep in mind. Number one, the United States economy is going through a transition as the baby boomers leave and the Zoomers come in. We’re losing our largest workforce ever, and it’s been replaced with our smallest workforce generation ever.

That’s going to change the complexion of the economy. That’s going to change what we need to do in foreign policy. From an economic point of view, that is very much in flux. This has never happened in American history before. We are making it up as we go along. Tariffs are part of that. Trade deals are part of that.

And we haven’t had time yet for politics to rearrange around this fact because we’re still in the opening years of the transition. So that’s problem one for why we really don’t know. Problem two is it the bipartisan nature of foreign policy is gone now, from 1945 until very recently, until probably the Obama administration, maybe even through Trump one and Biden.

But certainly within the last 15 years, it’s broken. We’ve had bipartisan foreign policy because we had an agreement on what we needed to do. The Soviet Union were the bad guys. We needed the alliance in order to contain them. So the United States used its military to basically buy up an alliance. We would protect you.

We would allow you to sell your products into our market if in exchange, we could control your security policies in order to box in the Soviet Union. Soviet Union’s been gone for 35 years. We never had a conversation on what should replace that policy. And eventually we knew it was going to fall apart. And under Trump, too, it has fallen apart good and hard.

But we don’t have a replacement system. Trump might think he has a foreign policy for the ages, but he doesn’t have a successor. And the Republican Party has been shorn of its policy arm. Trump destroyed it and basically made the party a just a campaign function with no talent recruitment, no talent gestation, no policy development. And the Democrats are useless, for so many reasons.

Anyway, bottom line is, when we go into the next presidential cycle, there’s no successor for Trump and the Democrats really don’t have any rising people. And even if you had a personality on both sides who Is liekly to take over things, there really isn’t an institution in either party that is capable of coming up with ideas for what should be next.

Nor is there in government, the Trump administration has gutted a lot of branches of the US governing system that help with planning. Just to pick two, there’s an office that basically hunts down epidemics on a global level, but it’s based on science. So one of the first things that DHS chief, Robert Kennedy Jr did was gut it so it could never tell him that he was making shit up.

And in the US military, we had something called the Office of Net Assessment, whose sole job was to look over the horizon and game out what the next conflicts were supposed to look like, but they made Pete Hegseth look like he wasn’t a very bright boy. And so that office was gutted as well. Things like this had happened in commerce and Treasury and all the rest.

And so the things that the US government used to do to help the presidency prepare for whatever is next, they’re all gone. So we’re kind of flying blind when it comes to thinking about what the challenges and the opportunities of the future are going to be. And because the parties have not been able to step into that gap for various reasons, we have an inability as a country now to prepare.

And so any policies that we are going to have for the next decade probably are going to be solely based on gut feelings like Donald Trump or blind ideology that is completely uninformed by modern affairs. That is going to get us involved in a lot more conflicts that are going to be a lot bloodier than they need to be, because we’re not doing anything to prepare for any of them.

We have been here before, in the world before the World wars in particular. Certainly before World War two, the United States didn’t have a dedicated foreign policy arm in the way that we thought about it during the Cold War. And so we basically had a complete overhaul of what our foreign policy used to be, almost every administration.

We are now going back to that sort of situation. But in a world that is far more interconnected than anything we had in the 19th century. So, yeah, it’s going to be a really rough, really rocky ride until such time as our political system regenerates and we get some decent leadership who can actually think forward. I would love to think that’s going to happen for the next presidential election.

I have absolutely no confidence it will, because Donald Trump has a vested interest in making sure the Republicans don’t turn the page. And the Democrats are so chaotic right now, it’s really difficult to see them coming together. We will probably have to wait for a third force, somebody either rising up within the parties or forming a new one to basically take the reins and start us over with a new structure.

Historically speaking, we have done that many times. But it isn’t always an awkward process to live through, and it usually takes about a decade. So for now, the next few years, this is where we are.

Who Needs National Security Guidance Anyways

The pentagon in Washington DC. | Photo by envato elements: https://app.envato.com/photos/982e8cf6-356f-43cd-88b2-6fac5fb7d312

The newly released national security document from the White House is more of a culture-war manifesto than a strategic guide for US foreign policy.

The document makes a series of troubling claims and, despite lacking any coherent guidance, signals two major shifts: an institutional breakdown at home and a strategic pullback from the Eastern Hemisphere.

Hey all, Peter Zeihan here coming to you from Colorado. And today we’re gonna talk about the new national security document that was put out by the white House. Now, the whole idea of the document comes out every year, and it’s supposed to be the white House guidance to the rest of the U.S. government. What our goals are and what we’re worried about on an international stage.

So it’s supposed to be tactical advice for generals and admirals and diplomats and all the rest. That’s not what we got this time. What we got this time was the American culture war in international form. It’s basically a campaign document. And whereas all the national security documents in the past have been designed about around guidance, this is really just a lot of really assertive claims.

And while in the past it’s all been about the United States, this is one is very much about Donald J. Trump. His name came up almost 30 times in the document. If as far as I am aware, in the decades of the white House has been putting this document together, never once has a sitting president’s name arrived at all.

Because it’s not about one guy. It’s about the country. That is not the case. And again, this is basically a culture war document taking American domestic political considerations and projecting that onto the international system, something that won’t work very well because in the United States, if you want to run for president of a political faction, you have to rally that faction.

That’s how Trump became president. So he got the Republican nomination. That’s how he took over the party. Yes, yes, yes. But that doesn’t work on the international stage because there is no vote. This is a document that is basically designed to be red meat for MAGA and provides absolutely nothing for guidance for policymakers. It also does a couple of things that are grossly against American national interests.

For example, it almost expressly ascribes a specific sphere of influence that no one else should have power. And for both China and Russia, and in conflict with several things that have actually come out of this administration, has actually said that the Chinese should have a right to basically control everything in their neighborhood. Russia barely comes up at all, despite the fact that the Russians have killed more Americans over the last 30 years than any other country, far more than anyone involved in the war on terror.

Obviously not a lot comes up about Ukraine. No real shock there. But what is perhaps most concerning from an international point of view, if you’re not an American, is the attitude towards Europe. Basically, the Trump administration is now saying it’s an American national interests for the politics of Europe to revert to back to where it was in the 1930s.

And I’m like, it’s like, just remember what happened in Europe in the 1930s. It was not a pretty place. It says national interests of the United States, involve include the ethnic breakdown of individual European states, which is, I mean, fascist and racist are the two words you would probably want to use. And the Europeans are…

Let me put it this way. If this really is what the United States wants, then we are basically asking the Europeans to go back to the darkest page of their history and basically kill anyone that doesn’t look like them. And to rearm as part of that process and have an independent foreign and security policy. Every time that that has happened in the past, Europe has gotten really fucking crazy in a very short period of time.

Most recently, we called it World War Two, and before that, World War one, and then the half dozen major wars we had in the 19th century as well. But let’s put that to the side. Does this mean that this thing doesn’t matter because there’s no real guidance? It’s really just a political stake in the ground, not what I’m saying.

It matters very much for two big reasons. Number one, this administration, is really bad at building institutions. And to implement the things that are in this document requires a fundamental rethinking of American governance, and especially the American military. For example, one of the things it says it wants to do is use the military to secure the southern border.

If that is what we want to do, that means no more F-35s, no more Abrams, no more special forces. That means retraining the military to patrol an area that’s 2000 miles from end to end to an indeterminate amount of thickness in order to catch illegal migrants. That is a very different sort of force. And the force we have now is vastly over trained for that.

And we’d be basically taking people that we’ve invested somewhere like 100 to $400,000 per person based on the job, to basically make them all cops, massive waste of material, massive weights of skill sets, and the time that it would take to build up an institution that was capable of doing that. It’s not something that you measure in months or even years.

A great example is what the Trump administration is trying to do with Immigration and Customs Enforcement. They’re trying to double the number of agents and for their domestic policy concerns. That makes a lot of sense. But what they’re discovering is when you take the rhetoric of the white House and combine it with the reality of the immigration, pool in the United States, you get a very different situation.

According to the rhetoric, they’re going after the drug dealers and the rapists. According to the data, most of the people that have been arrested have no record whatsoever or very, very minor infringements. And so when you’re recruiting people for that specific task and the people who start to look at the jobs realize that the drapes don’t match the carpet, you get a very different sort of applicant.

And so, the Immigration and Customs Enforcement Bureau has had to basically dumbed down their training regimen. They’ve gone from a 16 week course to a six week course. They’ve removed Spanish proficiency, and they’ve basically started to actively recruit from, like, white power gangs because they’re having a hard time getting people who have a sense of what law enforcement is about, who really want to uphold the rule of law, to go into downtown Chicago and get people who are trying to, you know, do yard work.

I actually have a client who told me a couple of weeks ago that She got hit by a little tear gas when she was out for a walk with her dog, because ice was reading a house where a guy was finishing a bathroom because, you know, the Sinaloa cartel of bathroom finishers. That’s the real threat.

When the rhetoric is done for ideological purposes, eventually it crashes into reality. And that happens here. And it’s making very hard for this administration to build an institution. They’re pretty good at tearing them down. Which brings us to the next piece. Something that can be done out of this document is a whole scale re shifting of American military power from the Eastern Hemisphere to the Western Hemisphere.

Very, very clear that that is something that this administration wants to do that can be done. You can shut down the bases in the Eastern Hemisphere. You can reposition your military in this hemisphere and carry out different sorts of activities here. Now, according to the document, they want to do that with allies.

The problem is, is that the three countries in the Western Hemisphere, that the United States has the strongest links with to battle human migration and to battle illegal narcotics, are the three countries that this administration has gone out of their way to antagonize Canada, Mexico and Colombia. Meaningful trade talks with Canadians are at a standstill at the moment.

The Mexicans are basically dodging every bullet that the Trump administration can fire their way. And now President Trump himself is down on record calling the president of Colombia a drug dealer. So this is stuff we’re going to have to do ourselves if we are serious about it. One of the advantages of the old system, where the United States controlled the global order and led this vast alliance network, is when the rubber hit the road.

If shooting never actually happened, the US took control of almost the entirety of the alliances, armies and navies and air forces. Massive force multiplier before you even consider things like basing rights. If we’re going to do this in the Western Hemisphere, if we’re going to do this ourselves. You’re talking about a military budget that’s going to have to at least double, and a massive retraining of everything that we have had the military do over the last 60 years.

That is a lot of wasted investment in order to do things that would be much easier to do hand in glove with some allies. So overall, what do I think about this document? Well, I don’t think you’re going to find a lot of people with any intelligence or security experience, much less economic experience, who think there’s a lot here that is worth salvaging. But this is only year one of a four year term for Trump round two, and there is a lot of time between now and the next presidential election where things like this can actually dig in

Until this administration can prove that it can build something as opposed to just tear it down, we’re simply looking at a reduction in the ability of the United States to affect the world around it, and that is something that will reverberate throughout the world for decades to come.

Crippling the Kremlin with Russian Sanctions

landscape of the kremlin in Moscow, Russia

The Trump administration’s sanctions on Russia’s energy sector are proving to be more substantive than the other policies we’ve seen.

Hey, all. Peter Zeihan here. Coming to you from Colorado. Today we’re talking about the sanctions that the Trump administration has put on the Russian energy sector, most notably on Rosneft, which is a state oil monopoly near monopoly, and Lukoil, which is the largest technically private company, but is really indirectly run by the state as well. A couple weeks back, the Trump administration put punitive tariffs on the two companies, saying that, no one can deal with them at all.

And, if they do, they can’t deal with the United States or access the US dollar. And since all, crude traded internationally, well, well over 99.9% of it is exchanged in the US dollar. That basically means being shut off from global finance, among other things. We’ve had a few developments. First, a minor one with Hungary, Hungary’s president, Viktor Orban, who is, well, it’s kind of a weird cat anyway.

He is an anti European anti-American pro Russian stooge, is the very short and to be perfectly honest, not particularly biased view. He’s been, working to sabotage sanctions on all things Russia and embargoes on all things Russian ever since the Ukraine war started, and has actually said that, if the Russian troops were in Kiev, they’d probably be better for Hungary because Hungary wants a piece of Ukraine as well.

Anyway, he was in the white House and managed to, Sweet talk his way into getting an exemption from the sanctions. Hungary has been basically using and gorging upon Russian crude for the entirety of the Ukraine war and has been trading, exemptions to European sanctions and tariffs and such, in order to maintain access in exchange for letting the Europeans do what they want more broadly with the Ukraine question.

And he was able to repeat that feat with Donald Trump this past week. I wouldn’t count on that lasting because no country that borders Hungary has a similar exception. So now that the sanctions are in place, there won’t be Russian oil or natural gas flowing through Ukraine to Hungary and even things like nuclear fuel are gonna have to be flown direct, but they’re going to have to be flown around the war zone that is Ukraine.

And if you have radioactive material in your plane that trigger some other issues anyway. So, the Ukrainians are saying it’s a permanent exemption, that the Trump administration is saying it’s a 12 month exemption. The, the disconnect between the two is pretty typical for Trump’s deals on anything, and how the Hungarians are going to be squeezed out of this.

It’s not a real problem. There is no alternate infrastructures that comes in through Slovakia or especially through Croatia. So they’re going to be fine. So it’s temporary issue. The broader issue is that Lukoil is actually an international company, whereas Rosneft’s holdings are all domestic. And for Lukoil, who holds assets in the United States, a lot of fuel stations. Or oil fields in Iraq. You’re actually talking about a substantial amount of production and financially viable assets that they’re going to have to now dump. Now, they were planning on selling them to a trading company based in Switzerland called governor. Now, governor was this is kind of funny. It’s a shell game.

Back in 2014, the first time the Russians invaded Ukraine, governor was set up by a Russian who was affiliated with Lukoil. And then he immediately sold all of his shares to his Swedish partner because he knew he was going to be sanctioned. And it’s been operating as an independent, independent trading, platform ever since. The whole time it’s basically been a front for the Kremlin.

And so the feeling was that governor was just going to buy all the assets. The Trump administration still hasn’t staffed up. Almost a year into its administration. And if you want to actually have a sanctions regime that is meaningful, you have to have a staff on it full time to deal with all the loopholes that will pop up.

That’s been a big one. Well, the Treasury Department under Treasury Secretary percent, figure that all do all by themselves or with some help. I don’t really care how. And have already said that they oppose the sale to governor. So the assets are going to have to be split up on a national basis and sold more viably to get away from Russian influence, which is, you know, great.

This is the first time in any sort of economic policy out of this administration that there seems to have been any awareness of some of the political and economic realities at the ground level. Normally we get a big broad tariff policy and then countries figure out how to get around it. The Chinese certainly have done that over and over and over again.

But at least on this one point, the Russians have not. And that is absolutely worth noting. And giving credit where credit is due. Let’s see. There was one more. Oh, yeah. Rosneft has is a state monopoly. It’s technically incompetent. It really has very few petroleum engineers, and it’s gotten to where it is as being the biggest company in Russia by absorbing the assets of other people who have, from time to time fallen a foul of the Kremlin.

Maybe that’s Yukos, which was run by a one time Russian oligarch. Maybe that’s T and CPP, which was a partnership that was part owned by British Petroleum. They just call themselves BP now. Anyway, it’s expansion through government thuggery rather than the traditional methods. Well, that that’s now reached its peak because there are a number of projects that Rosneft is involved in and is technically the operator that it can’t operate.

It can only run the projects with foreign partners who are doing most of the technical lifting. And the biggest and most important of those is something called Sakhalin. Now that’s an island off in the Russian Far East, just north of Japan, that produces some of the world’s most difficult to produce crude oil in league with a company called Exxon, and which produces liquefied natural gas with a couple of Japanese companies, Mitsu and Mitsubishi.

Well, now that the sanctions are in place, the Russians are going to have to run Sakhalin themselves, and they don’t know how to do offshore, and they don’t know how to do liquefied natural gas. And they certainly can’t operate in the Sakhalin environment. So here we’ve got a project that is the single largest dollar item of foreign investment into Russia ever.

That’s probably going to shut down over the next few months because the Russians can’t operate it themselves. Unless, of course, there’s something that weird goes on where Exxon, for example, gets an exemption to the sanctions, which I don’t find likely. Anyway, that’s the money. Russia, most of which is pretty good for Ukraine and honestly, broadly positive for the United States as well.

So, you know, mazel tov.

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