Hey everybody. Peter Zeihan here coming to you from the Trinity River Greenbelt in the heart of Dallas, Texas. Today we’re gonna do a little bit of a compare and contrast of the two parts of the United States that economically, I think are going to do the best. The first one, of course, is Texas, specifically an area called the Texas Triangle, which includes the four great Texas cities of Dallas, Fort Worth, Houston, San Antonio, and Austin.

Now, this is a part of the country that has done exceedingly well for the last 30 years. It has taken advantage of the fusion with Mexico to basically generate like one third of the total economic growth the U.S. has experienced. Mostly, that’s just the integration of Texas and northern Mexico. Houston is, of course, the energy town and the Permian Basin and the Eagle further right here.

So they will never have, a problem with energy supply. Austin is a tech center, which is where Silicon Valley sends all their new designs. And Austin figures out how to make it work. Those, once they make it work, it they go to San Antonio and Dallas for the mass manufacture in Dallas is in addition to being a manufacturing center, it’s also arguably the second or third biggest financial center in the United States.

It’s also in terms of spatial land and population growth and the fastest growing city in the United States. These are all trends that are likely to continue for at least the next 30 years. And as the United States needs to restore jobs and gobs and gobs of manufacturing, this is definitely the region that will benefit from these changes the most in absolute terms, with it basically being a Duke out between Dallas-Fort Worth and Houston, I’ve seen who’s the top city and who’s number two and number two still a pretty good position.

The only downside of it, as you may have guessed, is that, you know, this is not a walk friendly city. Dallas, all of the Texas cities have expanded hugely over the last 30 years, and they’re having all the growing pains that come from this. And just getting to this green belt was a bit of a chore. Also, it is October 2nd.

As I recording this, it’s already 85 degrees at nine in the morning. We’re hit 95 today. So these in many ways are becoming indoor cities, especially Houston, where for large portions of the year you just don’t want to be outside. So there’s definitely a quality of living issue. But they make up for it by having no income tax.

So you know you got to choose, the other state, which I had hoped to record, the other half of this video from is North Carolina. Unfortunately, it was raining the entire time I was there because of Hurricane Helene. And when we finally got a break and I went outside, I got stung by a bee before I got more than a 10th of a mile from my hotel.

So I took the Q and A recording. The North Carolina function from here. North Carolina is not a state that a lot of people think of when they think of industry. I mean, you know, it’s got more than 10 million people. It’s got a reasonable chunk of population. But the coast of North Carolina isn’t that great for ports.

And so it’s never been thought of as kind of an inroad X road ingress egress sort of trade hub. Also, you’ve got the much more dynamic economies and larger economies further to the north of the south. Atlanta obviously is a bigger city than anything that the North Carolinians have. And if you go north, you don’t just hit, the greater DC area, you hit Megalopolis.

So we always kind of forget about North Carolina in the middle, but in the world we’re moving into, the United States needs to double the size of the industrial plate. We are seeing that in Texas on a very daily basis. But in the case of North Carolina, the advantage is that the northeast can’t do it. Like I said, 100 million people, they don’t have much brown space.

They don’t really have green space at all. And they’re still going to need product. So they are going to be looking around for places to invest in physical plants in order to build the stuff that they need. The first stop is Virginia, and I’m not suggesting Virginia is going to punch well above her weight, but Northern Virginia is incorporated into the DC sprawl.

There’s no room there for a lot of industry. Richmond is great. Love Richmond, but it’s on its own. And until the Jones Act is repealed, the Chesapeake is a body of water that should be an industrial powerhouse, but isn’t because we’ve made it impossible for shipping among the Chesapeake communities. And so it’s basically a near rural region, which means your next chunk of population centers, if you go west, you hit, Pennsylvania.

And, you know, you’re probably going to see some build out there of the former, Rust Belt. But really it comes down to North Carolina and the, options kind of come in three phases. The first phase is a corridor that already exists, and that’s the kind of northeast or southwest corridor between Charlotte at the south end and the triad cities of Greensboro, High Point and Winston-Salem at the north.

This is an area that is very well developed, has a lot of infrastructure that’s in very good shape and basically there’s endless room for industrial parks up and down the entire corridor. In the second phase, you can link this first quarter up with another quarter that’s further east. The Fayetteville, Raleigh, Durham corridor. And basically you get this parallelogram that looks a lot to me in shape and structure, like the Texas triangle.

And the space in between is pretty much easy to develop. And even if that’s not enough and that’s a lot a little bit further east, you’ve got some areas that are kind of cut through with rivers and the North Carolina. So try not to think about that because it’s the poorer part of the state. But the potential industrial space there, the worst of it is better than the best in the northeast.

The only problem that the North Carolina is going to have with this is the capital, build out the industrial plant, but that’s where New York and Boston and DC and Connecticut and the rest of them come in because their choice is to not have product or to help the North Carolinians help there. So in absolute terms, Texas definitely far and away the winner here in relative terms look to North Carolina.

Something we discuss amongst ourselves, Peter, is the shifting, changing global order. What happens to small countries around the world, like New Zealand, as the U.S. strategic relationship with this post-Cold War global order starts to change and the global environment shifts? I don’t think New Zealand is the country to look to. I think Japan is the country to look to because Japan so far is the only country that’s figured it out.

A few governments ago, the Japanese realized that the Americans were losing interest in everything. Japan, like a lot of countries, is dependent on international trade for its economic health, especially for its energy imports. They realized that unless they could get into the American inner circle, give the Americans something that they want, there wasn’t much of a future.

For smaller countries that are less capable than Japan, this is triply true. What Japan did is seek out a deal with the United States on America’s terms. During the Cold War, when we needed everybody to be on our side to face down the Soviets, it was the United States that provided the economic and strategic concessions in order to build the alliance.

That’s not the world we’re in anymore. Now, if you have a more disassociated America, you have to bring the case to them. You have to offer them something in order to keep them involved. In Japan, it was trade concessions and a security partnership. For smaller countries, you have to be a lot more aggressive and a lot more giving in order to keep the Americans interested.

New Zealand, being off the edge of the earth, basically doesn’t face the security concerns that a lot of other people do. For them, their interest is going to be primarily economic because they produce a lot of agricultural products that the rest of the world really needs. That is an easier carry before you even consider the cultural connections between America and New Zealand.

But for most of the rest of the world, that’s a much taller order. The things that you have to offer the United States in order to keep them engaged—there aren’t a lot of things that the U.S. is really interested in, and you’re going to have to get really creative and dig really deep.

With the U.S. reevaluating its position globally and with the emergence of the largest land conflict in Europe since World War II, with the Ukraine-Russia war in place, we’ve seen some regional powers shift how they behave within broader Europe. I’m thinking about France, Sweden, and Turkey. What do we see between these three regional leaders/powers?

When it comes to their political, economic, and military mindset, how they interact with each other, and what that means for the future of the EU, Europe, and NATO overall, you’ve just put your finger on the three countries that are going to matter—not just now, but ten years from now, twenty years from now, and thirty years from now.

But for the remainder of the century, for demographic reasons, we’re going to lose, at some point, Spain, Germany, Italy, and eventually Poland. But these countries have very healthy democracies and a geography that allows them a degree of freedom to act outside of the confines of just Europe. How they get along or don’t is going to determine what is possible for NATO, the EU, and a post-unified Europe.

At the moment, the French are increasingly taking their talking points from the Swedish government. The Swedes have always been very big on energy security, manufacturing self-sufficiency, and partnership with countries immediately around them in opposition to Russia. Now that they’re no longer neutral, the French are sounding a lot like the Swedes. So the room for partnership there is very robust.

So long as ego doesn’t get in the way—I wouldn’t even mention that if it wasn’t for the fact that France is one of the two powers we’re talking about here—it’s going to be very interesting, from my point of view, to see how the two powers coordinate or step on each other’s toes in Ukraine, because that is going to set a really strong pattern for their bilateral relationship moving forward.

At the moment, it looks pretty positive. No, they’re not talking past each other at the moment. Turkey, of course, is from a radically different culture. Turkey has a very different economic structure, even if it’s still very healthy from my point of view, and they’ve got a foot in the Middle East as well, which complicates things. But again, we’re seeing a degree of cooperation that didn’t exist ten, twenty, or thirty years ago.

So I’m pretty hopeful there. But I don’t think that’s going to last for the long term. Turkey is too big of a power, too dominating in its own neighborhood, and if Russia loses the Ukraine war, Turkey is one of the powers that has the opportunity to do a massive geopolitical expansion. That is something that is undoubtedly going to make other powers in the neighborhood a little uneasy, even if the Turks aren’t taking any hostile actions against them.

So we’ve got here a Swedish-German-French axis, with the Germans being the junior partner in the city partner, and Turkey trying to figure out just how much it can grab. This, to me, is starting to sound a lot like the 1500s. You’ve written about and spoken quite a bit about the changing global order and the U.S. sort of stepping back from its near-century of keeping the world safe, managing global shipping, and maintaining this global order.

When we look at the Red Sea and U.S. Navy actions against the Houthi rockets, is there a risk of the U.S. being pulled back into the Middle East from its current actions? Is the U.S.’s attempt to help secure global shipping through the Red Sea—a region in which the U.S. is not a major participant—a sign of the U.S. stepping back into its previous role?

It feels a lot like a placeholder to me. It’s become a testing ground, in an unfortunate manner, for American missile interdiction. We’re discovering that as easy as it is to shoot down an individual shaky drone or a missile, preventing a hostile group from launching any number of weapons systems any number of times is very difficult.

We’re talking about patrolling an area roughly the size of half of Texas, and it’s stretching American naval interdiction capacities to the breaking point because the Navy wasn’t designed for this. It was designed to interdict things shot at the Navy, not going off or through a wide swath of territory. And if a real country—not Yemen, but a real country—were to do this on a broader scale, it’s pretty clear to U.S. naval commanders now that there’s not a lot we can do about it. So, if someone else joined in, we’d have a real problem, and this belief that the United States is still patrolling the global oceans—even if we wanted to—would be pretty clear that we couldn’t, against some of the technologies that have evolved over the last 75 years.

In terms of the idea of the United States getting sucked back into the Middle East, I really don’t think that’s on deck. In fact, if anything, I think the Gaza conflict has underlined to the United States how little we want to do with the region. We’re having a fun little conversation with the Israelis that feels a lot like the conversations we were having with the French and the Germans a few years ago.

We tried to convince them back in the 2010s that, you know, the Russians are going to keep pushing. Look, they just invaded Georgia. They just invaded the Donbas in Ukraine. They just took Crimea. Of course, they’re going to do more. They’re going to push and push and push until they can’t. The Germans and the French were like, “It’s a brave new world.”

In fact, Germany was going to put into place a defense minister whose job was to wind down the entirety of the German military because they didn’t need it anymore, because we’ve entered a new era of peace. Then the Ukraine war happened, and all of a sudden, the French, the Germans, and a lot of other allies in Europe are singing a very different tune.

In the case of the Middle East, we have been saying publicly to everyone who will listen, at home and abroad, that we want out of the Middle East already. The Israelis assumed that what we meant was we wanted to double down on the alliance with Israel and turn against the Middle East. No, no, no—we want out.

So the Gaza war happens, and while we feel badly for what happened, what the Israelis have done in the months since, we also don’t feel all that hot about it, and the idea that the United States would get sucked into another long-range conflict in the Middle East so that Gaza can go exactly the way the Israeli government wants it to—that’s a dumb play.

What Gaza has done is kind of underline to the United States just how distasteful we find the whole thing. The discussions we’re seeing recently between the Israeli government and the American government on arms transfers are really bringing home to Israel that they are not the golden child. They are not the special exception that is going to keep the United States in the region, and that is forcing some soul-searching.

Finally, in Europe, it took a Russian invasion to change minds. Here, it’s taken a one-day-old arms embargo. But there’s a dawning revelation, one country at a time, one day at a time, that the United States is not the same place it was 20 years ago. That eventually is going to seep through many layers of incomprehension in many places. If you’re an American strategist looking at this, you know it’s kind of a little bit like the Nixon strategy of being unpredictable. But it’s not that there’s a master plan backing it all up—it’s just that the United States is looking to get out, become a free agent again. It’s a different world.

Hey, everybody. Peter Zeihan here, coming to you from upper Spiller Canyon in Yosemite. Just in front of me is Horse Creek Pass, which sucks. Anyway, this is Spiller Canyon behind me. That’s much better. We’re doing a number of videos while I’m out backpacking. This one, we’re going to talk about why Americans are so manic-depressive or, as most other countries refer to it, why Americans are batshit crazy.

It has to do with geography. When the original settlers started laying claim to the eastern seaboard of what’s now the East Coast of the United States, we were just another colony. Even when the United States got its independence, its opportunity for growth was very limited. You basically had a thin coastal strip that wasn’t even particularly well connected.

And there was the Chesapeake Bay right in the middle, which was valuable. But if somebody, as in the War of 1812 kind of thing, took over Baltimore, it cut the United States in two. So we discovered that Americans had a very regional approach to everything until we started penetrating inland. Part of the Treaty of Paris gave the United States the eastern side of the Mississippi Basin, basically up to the Appalachians, and then later the Louisiana Purchase, which gave us the western side.

This was a major change, one that has shaped America’s mindset ever since. As people took the National Road and entered the Ohio River Valley, they soon found out that these were the best farmlands on the planet, overlaid by the largest natural navigable waterway system in the world, just right on top of each other.

Anyone, for the price of a Conestoga wagon, which in modern times is like $14,000, could basically go out to this interior zone and within eight months be exporting grain through New Orleans for hard currency. This lasted for five generations, with the notable interruption of the Civil War.

For five generations, Americans found more and better lands. They got richer, and there were really no security concerns from their point of view. You do that for 150 years, and you develop a series of national ethos and mythos. For the United States, that mythos was that the world is ultimately a kind place, and that you just have to work hard, and security will take care of itself, and wealth will take care of itself, because that is what we knew for 150 years. But, as we have all learned, that is not how the world actually works.

From time to time, the world reaches out and punches you in the face. And for Americans, who went for five generations without a serious adjustment, well, we lose our minds because we become convinced that the covenant with God has been broken and that our days are over. We start a panicked recreation of everything about ourselves in a desperate attempt to survive.

Now, is this an overreaction? You betcha. But does this have an upside? Absolutely. Because if you respond to negative stimuli with reinvention, then the sky is the limit. Let me give you a few examples. The quintessential one is Sputnik. Let’s be honest here. It was a beeping aluminum grapefruit.

The Americans were ahead of the Russians at the time in rocketry, metallurgy, and electronics. But because the Russians were able to launch something that went beep, beep, beep, beep, beep, we lost our shit and completely overhauled our industrial base. We completely overhauled how we handled public education, and we then coasted on those advantages for the next 50 years.

9/11 is another really good example. It was a tragedy by any measure. I don’t mean to talk people out of that, but as a side effect of the War on Terror, Americans ended up at the sharp end of American power, striding every major waterway on the planet, something we have yet to use.

When that time comes, all the hard work is done. Vietnam is another great example. We lost a war to a post-colonial power that was a rice producer, and we were the world’s largest rice exporter at the time. As a side effect of our reaction to Vietnam, we took about a decade off, and we completely overhauled our defense industry, marrying technology to our weapons systems in what has become known as the revolution in military affairs.

That gave us everything from satellite communications to cruise missiles to drones. Our reaction, our overreaction, to stimulus is one of our great advantages, but it does mean we’re a little “whoo-hoo” when we’re dealing with the diplomatic side of things. When something goes down that we think is too much, we have to remake everything.

Now, our closest cultural cousins, the Australians, the New Zealanders, and the Canadians, have something similar to this. Let’s start with our Canuck neighbors. Actually, the Canucks and the Australians both, unlike the American settlers who found more and better lands, the Canadian and Australian settlers basically found a dead heart.

The Aussies found the Outback, which, you know, may be good for mining, but it’s certainly not good for the average person to start anew. And the Canadians found the Canadian Shield, which is forested land with a broken crust where you might be able to mine, but you’re never going to farm. So they had a very different approach.

In the case of Canada, this is where the passive-aggressiveness comes from because they’ve always seen the country to their south doing very, very, very well with absolutely no planning. With the Australians, this is why they have a tendency to be very, very forward-thinking because they know that at the end of the day, their capacity to leverage their own geography to achieve success is somewhat limited. So they have to have good relations with someone else. It used to be the United Kingdom; now it’s definitely the United States.

And then there are the Kiwis. They have a situation somewhat similar to the United States in that they pushed inland and found more and better lands, especially relative to the size of the country. But there was one big difference between New Zealand and the United States: New Zealand’s remote. The Americans have a massive coastline on two ocean basins.

So, you take the size of the United States and combine it with its resources, of course, it’s going to be a global power, which is one of the reasons why we get punched in the face every once in a while. The New Zealanders never had that.

The Kiwis could exist in a degree of splendid isolation should they really choose to, and as a result, they kind of have all the upside of what goes on in the American mind, but none of the downsides, because, you know, the last time that there was a war on New Zealand shores, you have to go back to like the 15th century.

I think that’s the 15th, 16th, 13th, mid-18th century when the Maori settled there in the first place and went to war with the natives who were already there. The result is a very, very different political culture. Okay, that’s it for me. I will, that’s my next stop. I’ll see you guys there.