See Part 1: From Sears to Google and Part 2: From Order to Disorder… in America.

So here’s where I get a bit nervous. One of the great truths in geopolitics between 1950 and 2015 is that American domestic politics barely mattered at all. Support for the global Order was strongly bipartisan and it was considered treasonous for any politician to seek foreign support against a domestic opponent. Republicans may have not cared for JFK, but they certainly didn’t try to reach out to the Soviets during the Cuban Missile Crisis to undermine him. Democrats might demonize Nixon, but they never considered collaboration with the North Vietnamese to score political points at home. (Jane Fonda doesn’t count.) Even in periods of America’s most intense infighting, the strategy was the same: the Soviets were the bad guys, and global leadership via the Order was the way to fight them.

As such I get to dive into the political guts of every country in the world with regularity, but I don’t have to dissect the internal politics of my home country. That’s awesome! Americans are really touchy about their ideologies; the bipartisan nature of American Cold War foreign policy enabled geopolitical strategists like me to take a pass on all things political.

Well, so much for that.

With American foreign policy in a state of collapse right along with America’s party structures, I now need to apply the tools I use daily on the United Kingdom and Germany and Russia and Brazil and China and Vietnam and India and Iran to the United States.

Everybody buckle up.

Take a look at this matrix. It breaks out the various voting blocks in the United States on ideology as well as old-style party affiliation. The closer to the top, the more you feel the government should stay out of your personal life. The closer to the right, the more you believe the government has no business in your economic life. If you hug the left, you feel the government must take an active role in managing the economy. If you’re near the bottom, you want the government to not simply respect but actively protect traditional societal norms. If you’re near a corner, you have hybrid views. For example, if you find yourself at the intersection of economic and social conservatism (the bottom right), you believe the government has no role in helping poor people get food, and the stress of poverty will actually do them spiritual good. If you’re completely opposite where economic and social liberalism meet (the top left) you look forward to the day that we all sing kumbaya dressed in government issued gunny-sacks paid for by the confiscation of the assets of anyone who owns their own home.

Factions are color-coded by political affiliation: blue for Democrats, red for Republicans, green for swing voters.

While you’re digesting that, a couple caveats followed by a simple observation:

Caveat #1: These are broad, poorly-defined groups because that’s how coalitions (and graphic making) work.

Caveat #2: Predicting the tactical shifts in American politics is tricky. Americans tend to be a bit moody. What follows is less a hard forecast and instead a probable outcome based on what we know today. It’s an example of the sort of work that’s consuming bigger and bigger slices of my time.

The observation: There are a lot of American factions in the bottom-left quadrant. Folks who are socially conservative on cultural issues, but also feel the government should play a role in ironing out economic inequalities – or at least personally give them more stuff.

That concentration is where Donald Trump is focusing his attention. The oval is the cluster of factions Trump is fashioning into a new coalition. Those bottom three categories (populists, evangelicals and pro-lifers) are his core. But that trio is not far off from the ideological mix that tends to drive unions, Catholics and Hispanics. I’m not asserting here that Trump has these groups in the bag. That’d be hilarious. I’m simply noting the ideologies of Trump’s core groups are not all that far off from these other groups, and that voting patterns among these factions in the 2016 election indicated a sharp break with what we thought we knew about who votes blue versus red.

Most union members, for example, are conservative on social issues and most of Trump’s core is left-of-center on economic issues. All tend to be somewhat distrustful of globalism. Despite all the rhetoric on all sides, the Hispanic vote isn’t locked into the Democratic coalition. Most voting Hispanics are social conservatives who are broadly against large-scale immigration unless it deals with family reunification issues. If Trump’s core coalition could find a way to massage the race issue, there’s a distinct and mind-bending possibility that not only could the – let’s call them Trumplicans – capture a large chunk of the Hispanic vote, but a sizable piece of the ideologically-similar African-American vote as well. That would easily give the Trumplican coalition an outright majority of American voters.

Noticeably absent from the Trumplican coalition are a pair of factions core to the traditional Republican identity: fiscal conservatives and the business community. Both are dismissed by Trump’s core as either irrelevant or an enemy, and both hold – at best – a very weak hand in the Trump administration at present. Their core ideological issue is that math matters – let’s call them Mathocrats – and they strongly favor a right-leaning tax policy that minimizes the role of government. Since the Trumplicans are somewhat left on economics, particularly when it comes to government spending, this pair of formerly Republican factions are likely to from the nucleus of opposition to the Trumplicans.

So who are the Mathocrats’ potential allies? Greens, Socialists and youth voters are probably out of the question as rebelling against basic mathematics is sorta their thing. That leaves a trio of more economically moderate groups near the top-center of the ideological matrix: pro-Choice voters, single women and gays. Women and gays are concerned with political rights, something that modern business thinks is broadly peachy. Women and gays want to protect their own property and financial assets – you haven’t seen a hissy fit until you tell a 35-year-old gay man that his partner can’t be listed on a lending agreement. (I sure know I threw one.) Such economic concerns are near and dear to the hearts of both fiscal conservatives and the business community. The only tension in such an alliance is getting over inertial expectations – and since issues of race are not in play, a Mathocrat coalition would have a far easier time of putting the past to bed than a Trumplican coalition.

Now think about this in terms of foreign policy.

Under the Order, the all-or-nothing nature of the Cold War dictated that foreign policy had to be bipartisan. It was not overly shaped by either party, nor did it much vary from administration to administration regardless. But now there is no unifying threat or need or theme. Each new party can have a foreign policy that makes sense to its constituents as things evolve. American foreign policy is likely to oscillate not only between administrations, but within them.

That is likely to be far more erratic than it sounds. Think of what has happened in the past two years. The Americans have abandoned many of their alliances and geopolitical agreements and yet taken minimal hits – NAFTA, NATO, the WTO, deals with Cuba and Iran and Turkey and both Koreas. It is all falling apart, yet the U.S. economy is growing quickly. Instead of being abuzz with talk of the world burning these past two weeks, Americans instead obsessed about how a would-be Supreme Court justice acted in high school. Foreign policy – at best – demands third-tier attention in the American mind, and typically then only when it is mated to a domestic issue they care more about.

But look who is missing from both potential coalitions: national security voters. Folks who care about national security are the ultimate agnostics. They don’t care about social mores or the culture war or tax rates or development policy or the balance of power between the federal center and the states. So long as the military is capable and politically protected, they’re good. American isolation from the world will make American foreign policy a part-time issue. America’s likely future political parties will make American foreign policy inconsistent. And with America’s military supporters being the ultimate swing voters, American foreign policy will be intensely kinetic.

Yes, the Americans are taking a break from the world and that is problematic, but it is nothing compared to what is coming. In about a decade, instead of living in a world where the Americans are the most powerful force for global stability, they are likely to be the most powerful force for global instability.

See Part 1: From Sears to Google and Part 3: Beyond Democrats and Republicans.

The American political system is in breakdown.

It isn’t a bad thing. It is perfectly normal. Healthy even. Let’s lay it out:

The United States has a first-past-the-post electoral structure based on single-member districts. When you go to the polls, you are being asked to vote for the specific person who will represent the specific geographic area in which you live. In most cases the winner will be the sole representative for said area in whatever representative body is in play. To win that specific seat, the would-be representative does not need a majority of votes, but “only” needs to get one more vote than whoever comes in second.

Applied across a large population and territory, such a system forces a two-party political structure. A party that attempts to cater to a narrow slice of the electorate would never be able to get more than a few percent of the vote, and therefore never gain a majority for any meaningful amount of time. The diversity of the American political and economic base further weakens would-be small parties: voters that make their living on the coal production of Illinois have different interests from those who work in the medical centers of Boston, the data centers of the arid West, the whiskey producers of Kentucky, the aeronautical center of Seattle, the chemicals producers of the Texas shore, the agricultural plains of the Midwest, and the techies of Silicon Valley, just to name a few.

So the question becomes, how do you become a big party that appeals to a lot of voters?

The solution is to put up a big-tent. To form a coalition of different factions that collectively appeal to more people. The trick is to form a coalition wide enough to attract lots of votes, but narrow enough so the factions under your tent don’t fight.

Between 1940 and 2015 the Democrats were pretty good at the first bit. Their coalition combined minorities, unions, Greens, socialists, youth and pro-choice voters. Collectively such groups make an easy majority of the American electorate. But there are many issues that spawn internal conflict. For example, “minorities” includes African-American, Hispanics, gays, and single women – all have radically different concerns, many of which conflict. When the Democrats play the culture war card, their entire coalition tends to implode: the economic concerns of African-Americans differ from the immigration concerns of Hispanics differ from the political concerns of gays differ from the reproductive rights issues of single women.

The Republicans, in contrast, have proven better at the second part of the electoral math: building a cohesive alliance. The Republican coalition comprises evangelical Christians, pro-life voters, national security and fiscal conservatives, business owners, and populists. With the notable exception of the populists, these factions’ core issues do not conflict, and since the populists in many ways define themselves as the anti-Democrats it has proven fairly easy for the rest of the Republican alliance to count upon the populists as a vote bank, without giving them much influence over the Republican electoral platform.

It all went to hell in 2016.

The implosion of the Democratic alliance has been most spectacular. An alliance of white, young, urban liberals and card-carrying socialists who make up (at most) one-fifth of the Democratic voting base threw a social media rebellion. They collectively seized control of the media during the primary process and made a bid to dislodge the Democrats’ mainstream candidate (aka Hillary Clinton) with one of their own (aka Bernie Sanders). As damaging as the fight was for Democratic unity, it was only one piece of the puzzle. African-Americans experienced a sharp breach with the Democratic National Committee over police brutality issues. Jill Stein successfully courted many Green voters to her splinter party.

And of course the Democratic strategic platform has some perennial problems that led to periodic vote collapses. Democrats see themselves as the voice of youth and immigrants. Unfortunately for the Democrats, the most liberal of the youth are too young to vote and as Americans age they become more conservative. Similarly, undocumented immigrants are the most pro-Democrat, but since undocumented immigrants are not citizens they cannot vote. Additionally, second- and third- generation Hispanics are very conservative economically and politically. In essence, the Democrats’ strategy mobilizes non-voters in the current election, who then go on to be the conservative voters of the next election. Perhaps not the best plan.

The Republicans are in a similar state of disarray. There were many things that went wrong for the Republicans in the campaign: campaign finance reform muted the business community, Hillary Clinton was actually somewhat attractive to national security voters, no one running seemed to care about government budget deficits, Trump was kind of a dick, etc.

But it all comes down to the role of the populists. Populists on the right are a mixed bag of folks that in general are very unhappy with some state of affairs. Their issues shift and manifest differently, but ultimately it can be summed up that they believe someone is screwing them and/or the country and they want it to stop. NOW! That typically makes them prickly on issues cherished on the Left – race, changing cultural norms, immigration, government intervention in their economic lives. But it also makes them prickly on issues traditionally owned by the Right – big business, banking, a government that does too little. The rise of social media didn’t simply allow the Bernie Sanders crowd to make an over-sized splash in the political pool, it also enabled the populists of the right to seize control of the Republican primary system and put their man on the ticket.

Trump’s rise to prominence was only possible because of the populist rise, and the populists broadly distrust not just the Left, but other portions of the Republican alliance. The populists’ reliable outrage combined with Trump’s trademark political-wind-detection and volatile personality has largely ejected the fiscal, national security and business factions from the Republican coalition – not to mention the Trump White House. All that is left are the populists and the narrow-issue categories of pro-lifers and Evangelicals.

Trump has figured out that the American political landscape is now so fractured – Democrats, Republicans and centrists all – that this narrow base is sufficient to sustain him in a first-past-the-post system in the short term. While many find Trump’s tweeting and shouting and rambling press conferences shocking and offensive and bewildering, he is not speaking to the “many.” He is speaking to this base, and so long as he keeps speaking to them they will stick with him to Armageddon.

This is obviously not sustainable in the long run, but that doesn’t mean it is not normal. The coalitions that make up the two American parties are not carved in stone. A quick read of American political history indicates this is the fifth time the two parties have broken down. Each time they reform with a different mix of factions. Keep in mind that before these seismic, party-smashing upheavals went down last time in the 1930s and 1940s, the African-Americans were Republicans while business leaders were Democrats. Times change. The parties change with them. But such change hardly happens overnight. Historically speaking, these political interregnums last about a decade. We are barely in year three.

Combine this with other things going on in geopolitical space. The entire basis of America’s Cold War strategy was to induce cooperation among a broad, global alliance of countries to hem in, beat back and in time strangle the life out of the Soviet Union. The Americans did this not simply by providing physical security for their allies, but indirectly subsidizing them with a network of global trade expressly designed to maximize the allies’ advantage to the determent of American economic interests. Faced with such an existential threat, American foreign policy during the Cold War was thoroughly bipartisan. Both parties supported the creation and maintenance of the global Order.

It all worked great and the Americans were able to win the conflict without a war. In the nuclear age that was no small achievement.

But it also means the entirety of what makes the modern world work – global supply chains for shipping, manufactures, finance, agriculture, energy and other raw materials – is an unintended side effect of a security strategy that achieved its goal back in 1989. And since the Americans are the only country capable of maintaining the military and economic structures the global system needs to survive – and because the Americans do not necessarily need those structures themselves – the whole thing is falling into Disorder.

American foreign policy today is mismatched by any possible definition. The global Order has run its course and the Americans have no replacement, leading to strategic drift.

That’s before the breakdown of the bipartisan consensus of American foreign policy.

That’s before the breakdown of both American political parties prevented the Americans from even having a conversation about how they might theoretically move on beyond the Order.

That’s before the rise of the American populists of the Trump coalition accelerated the abandonment of the old Order.

That’s before the factions most interested in the minutiae of foreign affairs – the business and national security conservatives – found themselves both without a party and ejected from being able to influence the White House.

A decade with the Americans out of the picture is ample time for the world to go completely to shit. Much of my work these past few years has been about just that devolution: what a world without America looks like.

But the Americans’ internal political discombobulation will end in time. Their parties will reform. They will have a foreign policy again. In fact, at least one of those parties may already be taking form – raising some possibilities both for the future of American politics and America’s place in the world.

See Part 2: From Order to Disorder… in America and Part 3: Beyond Democrats and Republicans.

Today’s story begins with the once-behemoth that is the American retail firm, Sears. In the last week of September Sears’ stock dipped below $1 a share, reducing the company’s market value below $100 million. Sears may still linger on a bit, but when a big firm falls into penny-stock territory, its outright liquidation is a foregone conclusion.

Sears (originally Sears, Roebuck and Company) is the iconic store of the American modernization experience. As a relative latecomer to the world stage, Americans got in on the industrial revolution significantly after most Western European nations. The vast majority of Americans lived on farms until late in the 19^th century. Urban Americans had access to manufactured goods, but in rural regions most people made their own clothes and tools – or tapped the expertise of craftsmen in local towns. Most of these in-town purchases were managed via general stores where managers, knowing farmers had no alternatives, gouged on pricing, credit terms and selection.

Enter Sears.

Sears sourced manufactured goods from American cities (and abroad) and built a distribution network deep into every nook and cranny of the American territories. Starting with luxury goods in 1886 and rapidly moving into everyday products, by turn-of-the-century Sears’ 500+ page mail order catalogues had become ubiquitous not just in cities, but in farmhouses. It was Walmart and Amazon all in one. Sears completely overhauled what Americans considered to be centuries-old economic norms and pushed cheap, high quality manufactured goods into every single home. Sears quickly became America’s largest firm and largest employer. Quite unwittingly, Sears started the United States on the long path to urbanization, the industrial age, and the destruction of the local retail store.

(Incidentally, when the British Empire brought its manufactures to German lands, the economic dislocation helped start a German civil war. So anytime you think Americans can’t handle transformative economic stress, please try to keep it in perspective.)

Sears’ near-death today is part of a similar economic transformation. Just as Sears was a physical manifestation of the Industrial Revolution, Sears’ end is part of the Digital Revolution. Gathering, processing and distributing information has been the bugaboo of corporate systems as long as there have been firms with a reach further than they could see. The steamship and telegraph obviously helped, but managing anything big first and foremost requires an information system.

The Digital Revolution thus far has reduced the cost of storing information to nearly zero. In the early 1980s storing a gigabyte of data cost roughly $500,000 and I think that’s without accounting for inflation (economists and techies don’t always have the best relationships when it comes to data comparisons). Today storing that same volume of data costs roughly three cents. Information transfer costs follow a similar path (part of why all publicly available email clients are available at no-cost).

With information now being in effect free, the biggest restraint on industrial expansion became… humans. Someone still needs to analyze and distribute the data, and then check up on the results. Humans in the data chain have become the general store managers of our time, gatekeepers to the consumer that escalate prices. Enter algorithms, designed from day1 to remove humans from the data management equation. With the elimination of those pesky human barriers, the Digital Revolution reached out into the real world of sales and distribution and killed the job-destroying monster that preceded it. That’s remade how we design, order, manufacture, transport and warehouse goods. It allows us to instantly transmit architectural plans, military orders, payroll, and cat videos as well as get two-day (or less) deliveries for free.

The problem with algorithms is twofold. First, we have yet to figure out how to program in value judgements and ethics. Second, anything that introduces a hiccup into the information flow – say, fact-checking – increases the cost to something above zero. Just as Sears’ systematically cut out costs, algorithms and the human decision-makers who design and manage them see the human element as a block on progress. Something to be ruthlessly excised.

That has set up Silicon Valley for the mother of all government smack-downs.

Let’s divide the American political spectrum into four rough blocks: the center-left, center-right, populist-right, and populist-left – and then look at how their view of Silicon Valley has radically shifted during the past three years.

America’s center-left originally adored Silicon Valley because they were corporate titans with social agendas that matched the center-left’s general political views – particularly when it came to social policies on issues such as education, gay rights, and multiculturalism. The center-left – epitomized by politicians such as Chuck Schumer and Diane Feinstein – saw Silicon Valley as remaking corporate America from within.

But as information transmission became free, this happy marriage collapsed. Silicon Valley resisted anything that might infringe upon information flow, including flows that harmed issues the center-left valued. For example, Russian attempts to spawn race riots or shift the direction of a presidential campaign, or the ISIS live-streaming of executions, or disinformation campaigns blaming train derailments on Hilary Clinton after she lost the election. Consequently, the center-left hasn’t simply dropped its support for the Valley, it now sees the valley as a threat to democracy itself. The Valley’s chronic misogyny in the age of MeToo doesn’t help the Valley’s case with the center-left either.

America’s center-right – represented in Washington by folks such as Paul Ryan and Mitch McConnel – similarly were wedded to Silicon Valley’s aura. In the Valley the center-right saw a heavenly manifestation of what could be achieved with American know-how and new technology and a spirit of entrepreneurship in a low-regulatory environment.

This happy marriage has also ended. At first it was about politics: Valley CEOs started to get a bit too public with their enthusiasm for left-leaning issues, and charges erupted that some in the Valley were censoring right-leaning political viewpoints on platforms they controlled. But the center-right’s concerns soon deepened to something much more fundamental: much of the Valley committed to never working for the American government – most notably the intelligence community and the Defense Department. But Valley services remained fully available for sale so their work could benefit other government’s programs.

The idea that the political liberalism of Silicon Valley is better served by allying with Xi Jinping’s dissident eradication systems or Vladimir Putin’s systematic repression than the U.S. military requires mental contortions the center-right considers unfathomable. The center-right now doesn’t merely question the Valley’s ideology or even its patriotism, but its sanity. The most pro-business part of the American political spectrum is now firmly anti­-Silicon Valley. Concerns about cybersecurity and the regulations those concerns will likely spawn is only the icing on the cake.

But as much credence as there is to the points of America’s centrist politicians, the concerns of the American populists are actually more valid.

The populist right started out furious with Silicon Valley. Whether the politician is Ted Cruz or Donald Trump, the Main Street verses Wall Street discourse is not only a powerful one, it is broadly accurate. The current manifestation of Silicon Valley is fundamentally designed to remove as much human labor from the economy as possible. It – statistically – is the greatest job-destroying machine in American history.

The populist left is, if anything, even more angry at the Valley. Algorithms and robots don’t pay taxes, but their profitable outputs still accrue. This concentrates the income of what used to benefit human laborers to the operators and designers back in San Jose. Politicians like Bernie Sanders and Elizabeth Warren are fundamentally correct when they assert this is a leading reason for America’s deepening economic inequality.

All four factions are correct. All four factions are edging towards policies that would revoke the Valley’s unlimited license via some sort of constraining regulation.

Tesla is probably in the greatest danger. Technically, Tesla is a car firm, but its valuation and finance-raising systems mirror Silicon Valley rather than Detroit. That gives it access to ridonkulous amounts of cash – something necessary to pioneer fundamentally new technologies – but lands it with the metrics of a conventional automotive firm. Therein lies the rub.

When it comes to evolving ethics in a dynamic regulatory environment, most investors go with what they know. They know Tesla is a badly-run company that has yet to figure out how to move metal around its own factory floor. They know Tesla has almost never met a production goal. They know Tesla cannot break into the mass market (the cheapest available Model3 is at fifty grand, with the subsidy). They know Tesla’s technology and materials science is insufficient to its goals. They know Tesla faces stiff, rising competition from more experienced market players.

They know Tesla is led by a CEO whose social media strategies mirror a broadly-disliked president. They know Tesla’s CEO has bet the firm’s future on a political ideology that provides subsidies that will not last. They know Tesla’s CEO sees no problem cross-subsidizing the firms of family members. And they know Tesla’s CEO has settled with the SEC on charges of stock manipulation which cost the firm that has never made a profit $20 million. There is no shortage of preexisting business norms and regulations that could bring Tesla down. Should the investment community ever believe Washington is coming for Silicon Valley, they will ditch the weak players first. It doesn’t get weaker than Tesla – ergo why the short-selling of Tesla is already so intense.

Facebook comes in second, and not simply for the role they’ve played in Russiagate. The firms’ unfettered and enthusiastic raping and selling of customer data has not simply shown no ethical constraints, but we now know Facebook actively markets its user data to scammers. Not via the web – dark or otherwise – but by sending sales reps to scammers’ convention and closing deals in person. The public trust has been lost. The question in my mind isn’t will Facebook be eclipsed and displaced by a rival, but will there be prison time for some of its executives?

Twitter may have a brighter future. Unlike Facebook, TeamTwitter admitted the role it played in Russiagate fairly early on and has taken steps to roll back the damage. Such public admissions combined with a sense of genuine regret – or at least a reasonable digital facsimile of regret – stand in stark contrast to Facebook whose grudging, plodding steps have the feel of a six-year-old who thinks moving a single pair of underwear to the hamper has cleaned up his room and thus should be allowed to go back outside to play. Are Twitter’s actions and contrition deep and fast enough? That’s a political question, but I give points for effort.

One likely path forward in regulation is the modification of Section 230 of the Communications Decency Act. To make a very long and technical legal explanation short, Section 230 stipulates information technology platforms are not publishers, and so are not responsible for any content they pass along. Without 230 we’d not have an Internet economy since all our infotech platforms would be liable for the accuracy of everything in every webpage, blog post, pop-up ad and email.

To date, there have only been three carveouts: copyright infringement, child pornography and sex trafficking. Silicon Valley fought those carveouts tooth and nail, asserting first-amendment rights issues, but mostly being concerned about costs. The hilarity of deliberate inaccuracies currently punctuating American political information systems – Russiagate being the prime example – are pushing many political factions to consider a fourth carveout for foreign election interference. And while with some very skilled coding an algorithm can be taught to look for prostitutes, I’m guessing that determining whether an ad that slams or celebrates Hillary Clinton or Donald Trump is accurate will require the sort of judgement call only a human can make. And humans don’t work for free.

Amazon probably faces less pressure, and probably has more time. Yes, AmazonPrime and related subsidiaries are a very visible part and parcel of the whole job-destroying ethos that motivates Silicon Valley. But three issues pop up:

First, the damage to American retail is largely done. A stiff roll-back at this point would probably be counterproductive. And this is hardly the first American retail revolution: general stores to Sears to Walmart to Amazon. At each step the process is more capital intensive but less labor intensive with slimmer margins. Where do you draw the line? Do you draw a line? (A change to how Amazon is taxed, however, is an excellent idea).

Second, Amazon would operate in the red if not for a single unit that has nothing to do with getting a hairdryer to you: Amazon Web Services. AWS is the data management portion of Amazon which is wrapped up in nearly every dataflow for every business in the country. It is well-run, faces competition, and has next to nothing to do with the retail arm. Splitting the two so that the wildly-profitable AWS cannot cross-subsidize the barely profitable (and until recently, unprofitable) Amazon Retail makes a wildly great deal of sense for all players. It would certainly preserve the value-added portion of Amazon that generates lots of new sources of economic activity rather than gutting old sources.

Third, Amazon is everywhere. I don’t say this to imply U.S. government entities cannot bring it down, but instead that Amazon’s retail activities are in every American county, complete with dozens of distribution centers and tax relationships. Should the regulatory floodgates open the result will be a thick, self-ambulatory tangle of regulations at the city, country, state and national level. It will be a rancid mess that Amazon leadership will be able to exploit to buy time and – most importantly – to shape in a way to mitigate end-impacts upon the firm.

Of the big boy digital firms, that leaves Google, whose recent actions put it into a category all its own:

Recent defections from Google’s development teams have exposed the firm’s work on a project they call Dragonfly, a search engine product for the Chinese market. Allegedly, Dragonfly tags certain search terms the Chinese government chooses that it thinks might indicate dissident behavior such as “how do I get a Canadian visa?” or “what happened in Tiananmen Square in 1989?” or “what is Falun Gong?” It then packages the request with other search data on the person in question, complete with IP and physical addresses and phone numbers and forwards the information on to the Chinese state. It’s a degree of privacy violation and government monitoring of civilians that would have disgusted Orwell.

If – and I emphasize the word “if” because I do not have a Dragonfly-style program covering Google HQ – Dragonfly is real, Google is in serious trouble. Collaborating with a dictatorship that is sliding into a cult of personality so complete Hitler would have salivated over the program violates every ethical and political norm of every political faction in the United States. Anything that puts Elizabeth Warren and Ted Cruz on the same side during Senate hearings should get everyone’s attention. And Google’s executives’ refusals to confirm or deny Dragonfly’s existence while under oath before Congress tends to shift my thinking that this is less bureaucratic bungling and more greed so all-consuming it constitutes treasonous behavior. It is exactly the sort of massive corporate miscalculation that has triggered catastrophic government crackdowns on major American firms in the past. The breakups of Standard Oil and Bell come to mind.

And it would happen under President Donald Trump. Make no mistake. Trump is no longer part of the party of the businessperson. Things in America have changed in politics too…

Donald Trump’s past week has been eventful, travelling to Brussels for a NATO summit, London for a meeting with the Queen and the UK prime minister, and Helsinki for a much-ballyhooed summit with his Russian counterpart, Vladimir Putin.

Trump was his usual self, denigrating allies and organizations that the United States itself created and runs. A friend of mine in the foreign policy community referred to Trump’s actions at the NATO summit and in the United Kingdom as the equivalent of taking a huge, steaming s**t on the entire Western world. And then in Finland, Trump indicated he believed Putin’s word over the American intelligence community and the Justice Department when it came to accusations of Russian meddling in the 2016 presidential election. Trump has since clarified that’s not quite what he meant, but it was clear from his tone and caveats that his “clarification” was written by someone else. Best guess on the author: White House Chief of Staff John Kelly (who reportedly went all Marine General on his boss upon his return from Helsinki.)

Back in the States, pushback to Trump’s statements – particularly to the Helsinki summit were… thorough. I have yet to see anyone in the world of American media that was not at least partially pissed off. Even Fox and Friends, by far the U.S. president’s favorite news show, was less than complementary.

I was particularly taken aback by the sudden explosion in the use of a word that doesn’t often crop up in American political discussions: treason. First used by former CIA Director John Brennon, the word’s use quickly spread across the internet to permeate the American political conversation.

It is not, in my opinion, very useful.

Treason is the crime of betraying one’s country, in particular by attempting to overthrow the government, attempting to kill the sovereign, providing assistance to a foreign power against the United States in war time, or providing aid and comfort to a foreign government. Considering that Trump is the head of the American government and the United States and Russia are not at war, making a legal case for the first three of these conditions is impossible. That just leaves “aid and comfort” – and if the full power of the United States government cannot manage a treason conviction against someone like Walker Lindh, it is difficult to envision someone making charges stick against the dude in charge of the U.S. government.

The people using the “t” word cover a disturbingly wide spectrum. The first are those who believed they could and should impeach Trump before he even got into office. These are the people who do not analyze, but instead – much like Trump – react by instinct. Trump’s particular… style… amplifies this visceral reaction. No matter what happens, their scripts are written until the day Trump is no longer president. I don’t pay too much attention to this crowd.

The second are the more reasoned critics, on both the Left and Right, reacting to Trump’s statements and actions. Some of these critics have been vocal from the beginning – like the Never Trump crowd – while others have tried to avoid the fray. Their ranks are growing – and getting louder.

These two groups combined cover a growing swath of the American public and policy establishment. The primary implication of the growth of these groups is that their size and volume make it more difficult for the American president to manage domestic affairs. That by default forces the president into the realm of presidential power over which Congress and the public play little role: foreign affairs. That’s right folks. Trump is going to do morestuff like this recent Europe trip because it may soon be all he can do.

It’s the third group openly discussing treason that really gets my attention: those who have made it their lives to serve and defend the United States during the Cold War and beyond, for whom the Russians have always been public enemy number one. The idea that an American of any stripe – especially the Commander and Chief – would actively seek a friendly relationship with a foreign leader and country who has proven so consistently, pathologically, and above all recently hostile to American interests to them is a world turned upside down.

But therein lies the problem. We are in a world turned upside down. This groups’ reaction is more a reaction to that altered reality than it is to Trump.

The global Order is out of date to the point that it was going to break apart no matter who won the 2016 elections. We can argue back and forth over the details of how a President Clinton would have been different – and there are many – but the core issue is the American people have lost interest in managing the global system. Without ongoing American involvement, that system was doomed.

The real problem here is that the generally calm, reasoned national security community – the soldiers, diplomats, and intelligence teams that keep us all safe, the people who represent the vast bulk of American expertise on all issues foreign policy – are working from a playbook that dates back four presidential administrations. Trump is hardly the only American president guilty of abdicating America’s global vision – it was a failing of the Clinton, W Bush and Obama administrations as well. What is different about Trump is that he is not even giving the old playbook lip service. Instead he is leading by instinct, and demonstrating that instinct can still reveal truths… truths that have been apparent for 29 years.

As regards Russia, I’m not a fan. Never have been. I tend to not like countries that have pointed nuclear weapons at me my entire life. But Russia is no longer the United States’ primary enemy and hasn’t been since 1989. That’s not because Moscow has started acting like Minnesota, but because the Soviet collapse and Russia’s relative weakness means that containing Moscow with a globe-spanning alliance is no longer the lens through which the Americans view everything. America needs to update its strategic policy, and pick and choose friends and foes as guided by that updated policy. And with that update, who knows, Russia may well be something other than a foe. You don’t have to delve too deeply into history to find examples of the Americans partnering with unsavory elements in order to defeat more unsavory elements: Mao against Stalin, Stalin against Hitler.

Putin against al Qaeda.

That doesn’t mean Trump’s actions are wise or productive. That doesn’t mean Trump has a plan. Of course there are better ways to do this. There are aspects of the NATO alliance – in particular members of the NATO alliance – that are worth maintaining. Even cutting NATO into bait would be more productive than the path Trump has chosen. But the bottom line is the Order is gone, and so far the only person who seems willing to admit it, however frustratingly, is the man at the top.

I get why the American foreign policy class feels overwhelmed, offended. Betrayed. After a quarter-century of American leadership largely ignoring them or sending them on wild goose chases through the Middle Eastern Sandbox, they now have a leader who has torn up the script they’ve been following their entire adult lives. It isn’t that they are wrong about the risk to the international order, per se, but instead that they are late to the party. What comes next for the world is scary, particularly after decades of relative stability and prosperity. The American policy establishment (much less the public) is panicking and stampeding for the door. It hasn’t yet realized that there is no going out the way we came in. Until that sinks in (and probably well beyond), Trump will be blamed as the cause. There is plenty of criticism for the quick, ugly, instinct-driven way Trump is severing America’s ties to the world, but there are far greater forces at work than a real estate mogul from Queens.

Instead of panicking through the saddest party of the century, the Americans need to find a new way forward. That’s impossible without a national conversation on what America wants out of the world, and it is certainly impossible without a president who actually engages with his own people. Until the United States figures out that new strategic policy, we will be living in a world in which the Americans are not a force for Order, but instead the greatest wild card in history.

Jump to other parts of this series: France, Germany, UK, Italy, Japan, and Canada.

U.S. President Donald Trump made a… let’s call it a splash, at the G7 summit in Canada June 9. The G7 comprises the seven largest industrialized democracies – the United States, Canada, Japan, Germany, the United Kingdom, France and Italy – who also form the core of the entire American alliance network. Their leaders and finance ministers meet regularly to discuss challenges to the global order. Normally, the G7 is a bit of a lovefest with leaders agreeing to push this bit of financial stability or that bit of poverty reduction.

This time was different. The Trump administration is busy belittling and/or wrecking parts of the international order, and a mere week before the summit the United States levied steel and aluminum tariffs on nearly all the G7 members themselves. As such the summit was preceded and followed by quite aggressive statements out of most of the G7 members, most notably from Canada and France, about how American tariffs would not be allowed to stand in specific and a general dissatisfaction with the position of the White House on global affairs in general.

In essence, ahead of the summit the G7 leaders were showing concern that Trump’s rhetoric wasn’t simply rhetoric. And in the summit’s aftermath the emotion could best be summed up as defiant despair that Trump really, truly, means what he says.

I can see why they’re all pretty bummed.

The Americans created, supported, subsidized, and maintained the global order since the end of World War II. Under that order the industrialized world in general and the other G7 countries in specific have done very well for themselves, rebuilding after the war’s devastation in an environment of absolute physical security.

Maintaining a global order is far from “normal” when viewed from the long stretch of American history. In fact, it has only been the dominant strain since the end of World War II. Before that the United States had other foreign policy themes that competed for top billing.

• In the post-revolutionary era it was all about standing up to the established European empires, with former imperial master Britain in general triggering a near-dehabilitating mix of obsessive paranoia and narcissistic fear.
• The competing ideology back then was that the United States should be one of those imperial powers.

Theme1 nudged the Americans into the War of 1812, and led the Americans to encourage the independence of the European’s imperial colonies throughout the Western Hemisphere. Theme2 birthed the Monroe Doctrine and set the Americans on their own pseudo-colonial drives.

But as the world – and America – changed, American foreign policy changed with it. The American Civil War and Reconstruction removed all appetite and bandwidth for meaningful foreign policy, triggering a shift to hard isolationism. Once the Americans finally had their (second) coming out party with the Spanish-American War in the 1890s, isolation gave way to a mercantile-driven dollar diplomacy where the Americans would fence off swathes of the world in a corporate-driven foreign policy designed to maximize American economic penetration. The Depression and World War I convinced Americans the world was no fun at all; isolationism came back into vogue.

The great upheavals of the World Wars left the US the pre-eminent power in every respect that matters. Over the course of fifty years, the Americans had gone from almost no navy, stealing Britain’s IP, and being a major global debtor to having the only navy, the technological edge, and to being an economic power on an unprecedented scale. The US had a choice: seek isolation once again and watch its only real competitor – the Soviets – slowly eat away at the periphery until they could challenge the US or find a way to take a ragtag group with long lists of mutual historical grievances a mile long and get them to work together. A real life Magnificent Seven.

The new idea was as straightforward as it was revolutionary: use America’s newfound and historically unprecedented economic power to pay all the previous competing powers of eras gone by to be on the same side. Any country that had any meaningful imperial presence could only do so if it also had a significant naval force. These empires’ clashes — over resources, populations and trade routes — were the root causes of nearly every significant military conflict of the entire industrial period, and they culminated into the First and Second World Wars.

In response, the Americans launched a broad system of what was collectively known as Bretton Woods, named after the location where the deals were first hammered out.

Bretton Woods provided global security for all the maritime and industrial powers, enabling all of them to access any resource anywhere at anytime safely, and then export finished goods to the American market. Bretton Woods puts all the world’s competing naval / maritime / trading powers on the same side by providing them with everything they had ever fought to attain. In exchange the Americans only demanded one thing: alliance against the Soviets.

All those purchased allies are all still powers of significance today, and it should come as no surprise that the most powerful of them now comprise the G7. All were represented at the G7 summit in Canada this past weekend.

The Bretton Woods strategy is notable in American diplomatic history in that it had no counterpoint. No other policy oscillated with it. Bretton Woods was both bipartisan and served as the norm for seven decades. But longevity and broad support are not the same thing as sustainability or permanence. The world is changed since the Cold War’s end, and now – belatedly and until now piecemeal – the Americans are finally changing with it. Trump’s foreign-policy beliefs are not a bug in the American system, they are a feature. Under Trump the Americans are firmly – finally – abandoning Bretton Woods, and in doing so flirting with all four of their pre-Bretton Woods foreign policies.

• Trump’s hardball on NAFTA is most definitely neo-imperial. He is attempting nothing less than the forcible change of the economic structure of America’s neighbors to meet specific American structural needs. Also fitting the mold is Trump’s suggestion that Russia be re-admitted to the G7. In a post-Bretton Woods world Russia is less a foe to be contained as it is a potential partner to leverage against other competitors.
• Trump’s position on Syria is flat out isolationist. As are many of his inklings on U.S. basing and strategic stances in Western Europe and East Asia. It isn’t as crazy as it sounds. Something that no one has ever been able to explain to me about American involvement in Syria is what-does-the-winner-get? And the idea that the Americans should defend the Europeans from Russia so that they can use Russian energy en masse has always been an awkward sale.
• Trump’s pending trade war with China has overtones of the anti-British policies of America’s early decades. And there are more than mere echoes of the general anti-British paranoia in Trump’s overall feelings about foreigners whether they be Chinese, Mexican, Iranian or Arab.
• Trump’s willingness to flirt with North Korea most certainly has a dollar diplomacy feel to it, and Trump has directed Commerce Secretary Wilbur Ross on a never-ending road-show for American goods… and linking potential sales to ongoing trade negotiations with, well, everyone.

Viewed through the prism of Bretton Woods all these goals and methods are inane. But viewed through the lens of anything other than the strategic environment for which Bretton Woods was designed, Bretton Woods itself is ridiculous.

It isn’t that these goals – or even methods – are good or bad. It is that they are different. It is that they better reflect America’s current situation than the Bretton Woods situation does. The Americans are done paying for alliance.

Courtesy of the G7 show this past Saturday, I think they get it now. I think America’s closest allies realize the shift in the White House is, indeed, real. I think they understand Trump is not bluffing. I think they’ve internalized that Trump’s rhetoric is the American position. I think they finally believe Bretton Woods will not magically regenerate when Trump is gone.

And that means it is high time for the allies to figure out where they fit into the scared new world that is tumbling open right in front of them.

In this series we will go through the other six members of the Group of Seven. These are the powers that the Americans co-opted to make the Bretton Woods system work. They are the countries with the greatest long-term potential to shape and re-shape their worlds. Many may be out of practice, but that is far from saying they are done with history.

by Peter Zeihan, Melissa Taylor, and Michael N. Nayebi-Oskoui

See Part I, Part II, Part III, and Part IV.

Event 5: Trump Unleashed (in progress)

The United States has never made foreign policy by committee.

The Constitution grants the executive broad authority and autonomy to collect information, come to conclusions, chart out strategies and implement foreign and military policy. Congress technically has oversight, but the legislative branch lost interest in and surrendered meaningful control over foreign policy over a decade ago. Within the executive branch there are no meaningful checks on the president’s powers, with all senior executive staff serving at the President’s pleasure (or, if you prefer, whim).

Trump has been pruning his executive staff quite rigorously in recent months, and the foreign affairs team is no exception.

Think back to the 2016 campaign. In the early months there were 18 people vying for the Republican nomination. Everyone assumed Trump’s campaign was a marketing scheme, so Trump got 18^th pick for advisors. This landed him with disasters-in-waiting such as Michael Flynn.

Upon actually becoming president, a number of individuals from more established interests either saw an opportunity to shape a man who was obviously a neophyte and/or felt it was their duty to the country to try and advise the freshman president. This gave rise to what I’ve called the “Axis of Adults.” These are the men who wanted to make sure the country didn’t go off the rails.

The chair of the National Republican Committee – Rince Priebus – became Chief of Staff in an attempt to inject some Republican orthodoxy. Army General HR McMaster became National Security Advisor with the intent of speaking truth to power. ExxonMobil CEO Rex Tillerson took over the State Department to share the insights of corporate America. Gary Cohn climbed aboard to explain the ins-and-outs of Wall Street.

All sought to actively shape President Trump’s views. All are now gone.

Another pair already have one foot out the door. Priebus’ replacement as Chief of Staff – General John Kelly – felt the best thing he could do to help the president was ensure accurate information delivery. That meant, among other things, taking away the president’s phone so he wouldn’t ingest bad information… and so Trump now plans his life without much consulting his chief of staff. General James Mattis – the Defense Secretary – now seems to be the only person allowed in the room with an interest in accuracy, context and consequences. It makes him a bit of a downer in adrenaline-fueled TrumpWorld, and I’d be shocked if he wasn’t excused by year’s end as well.

Bottom line: All the chaos and disruption of the past 15 months has been the result of a Donald Trump who has been actively held back. Now the world gets to see what a Trump unleashed – an America unleashed – can do.

The pace of… everything is about to pick up considerably. Between the end of the WTO and the dawning exploitation of secondary sanctions, the US is getting the free use of its other hand – its natural economic power. The Trump administration is testing America’s strength just as other major powers are hitting structural barriers, not least of which are demographic. The Americans are now only one of the few peoples that are repopulating, within a generation the average American will be younger than the average Brazilian (the Americans are already younger than the average German or Chinese). At the same time the collection of people who have repeatedly talked the president out of some of his more disruptive policies are now either gone or sufficiently discredited in the president’s eyes that they might as well be.

It isn’t so much that any individual actions taken by the Trump administration will or won’t work. It isn’t so much that there is or isn’t a grand, multi-faceted plan in the White House. It isn’t even that the president does or doesn’t understand the context or consequences of his policies. And it certainly isn’t that this is not what I would do if I were king for a day.

It is that global population patterns are dependent upon global manufactures trade to generate income, and global agricultural trade to pay for food from abroad. It is that the global transport that enables such sectors to work requires a global order.

It is that since World War II the United States has sustained the only true global order that our world has ever known.

It is that not only is the United States no longer holding the global order together, it is actively breaking it down and there is no power or coalition of powers that can even theoretically take its place. It is that a world without America is a world in which other countries – whether out of desperation or opportunity – feel forced to protect their own interests. And most are wildly out of practice, wildly vulnerable, or – in most cases – both. It’s that America’s only significant geopolitical competitors – Europe and China – have become irrevocably addicted to that order just in time for it to end.

And perhaps most worryingly, it is that the Americans’ abdicating global leadership isn’t the same thing as the Americans’ abdicating global power, or global reach.

It is that the party is over.