Peter Zeihan is a geopolitical strategist and the author of four books, including most recently, The End of the World is Just the Beginning. In this episode, Peter talks about the civil unrest – and pending demographic collapse — in China, why “Apple has refused to see the writing on the wall” in China, Mexico as America’s most important trading partner, why he is investing in commodities, and why — despite the unraveling now underway in many parts of the world — he believes “the American system will thrive.” (Recorded December 2, 2022.)
Robert Bryce 0:04
Hi, everyone, welcome to the power hungry Podcast. I’m Robert Bryce, on this podcast, we talk about energy, power, innovation and politics. And I think we’re going to talk pretty much about all of those with my guest, Peter Zion. He is the author of his fourth book, I believe the end of the world is just the beginning, mapping the collapse of globalization. Peter, welcome to the power hungry podcast.
Peter Zeihan 0:23
Thank you very much.
Robert Bryce 0:25
There’s the copy of the book, as I showed you. So now Peter, I told you, I was gonna hit you with a surprise here at the beginning. All the guests on my podcast introduce themselves. So you’re required to do that, and you have less than 60 seconds go.
Peter Zeihan 0:37
I’m a professional just er, I basically take everything from around the world, whether it’s energy or security, or politics or agriculture, or demographics and kind of put it into a blob and pull out the parts of the blob that are most relevant for the people in front of me.
Robert Bryce 0:52
adjuster is that what do you call it? I’ve never heard that word before. What is that?
Peter Zeihan 0:57
I take lots of information from every possible corner of the world and build it into a story. So the world makes sense for the people who I’m speaking with?
Robert Bryce 1:07
Well, and you’ve been remarkably successful at it, I would venture when we met in Austin here. Several weeks ago, we both spoke at a conference, the beginning of November, you mentioned that your book is now in that you said the 14th printing is that right? We just hit 16 Actually 16th printing Wow. And it’s on it’s it’s a New York Times bestseller i Is that? That’s right,
Peter Zeihan 1:29
it surprises anyone.
Robert Bryce 1:31
And you were just selected by the Financial Times is one of the top books of the year as well. So you’re on a roll.
Peter Zeihan 1:37
It’s it’s a little creepy.
Robert Bryce 1:40
So let me just ask you about the book for a minute because I’ve written a couple books myself. Six, not bragging. Okay, I am bragging. But what I thought was interesting, just in reading your book, I don’t and I’m not complaining. But it to me, it’s a remarkable book in the whole thing. And it’s 480 pages. It’s you talking essentially the whole time you don’t you don’t quote anyone else that I can find in the book that’s unusual in in any kind of a nonfiction book that I mean, you know, it’s not that your your facts aren’t right. But it did you dictate the book. I mean, I’m just curious about the mechanics of the book itself, because it’s you giving one long 500 Page lecture. And that, to me is unusual. Tell me about that.
Peter Zeihan 2:23
It’s definitely unusual. I’m neither a journalist nor an academic, my background is in private intelligence. So it’s all been about taking huge amounts of information and distilling it down in order to figure out what’s going on and how when one thing changes things on the other side of the world react. As a result, the whole the whole of human history is my input. And if I were to cite everything that had some contribution to what I thought the citations would be a lot more than 480 pages. So I mean, I’m literally standing on the shoulders of not just giants who came before I’m standing on the shoulders of everyone.
Robert Bryce 2:59
Well, so let’s talk about that. Because I also did a little homework you from Marshalltown, Iowa, and your folks I just saw had celebrated their 50th anniversary. Am I remembering this? Right?
Peter Zeihan 3:10
Well, they’re up to like 53. Now.
Robert Bryce 3:12
Oh, okay. So that was that was a few years ago. And then you graduated from Truman State University. What is it good now now known as Truman, state, northeast Missouri State University, right? This is, I’m not going to dwell on this too long. But it’s in a lot of people in your business. And a lot of the geopolitical people, they’re Ivy League types, East Coast types, you’re not part of that I hate.
Peter Zeihan 3:35
So much. I lived there for 10 months, it was about nine and a half months too much.
Robert Bryce 3:42
But, but you know what I’m talking about,
Peter Zeihan 3:44
I totally get it, ya know, I mean, most people who deal with international affairs in the United States, like myself started out in DC, and most of them stay there, because it’s all about influencing the government or being part of the State Department or whatever else. I never went that route. As a rule, if you’re in Washington, you have to be there for 20 3040 years before you kind of get your first piece of the pie so to speak. And then you’re responsible for a very, very narrow sliver, the only way to get to the position where you can actually have influence over a lot of things is to become Secretary of State that requires you to be part of a political campaign. And I knew in my 20s, that was never going to happen. So I went to the private sector, and fell in with a company that did geopolitical analysis. And I was really the only generalist they had ever hired, everyone else was an area specialist. And so I did time in all of the regions and as a result, most of the clients liked me because most most analysts are kind of jerks. They try to make everything about what they know. And as a generalist, I was willing to interface with the clients and learn from them as well as the other way around. And so when I left, I had kind of built this map of how everything fits together, and I just took the map with me.
Robert Bryce 4:54
And that firm was here in Austin stretch for if I’m remembering correctly, right. Okay, well, so Enough about you. Let’s talk about China. Because you this, it seems to me and you warned about China in the book, you talk about China and demographics. But in the last few days, the situation there seems to have have become even more inflamed. How do you, you have a recent YouTube video in which you talk about this, and you’re producing YouTube videos all the time as well? What’s your take on what happens now? Because it sure looks like GE is they’re rolling back some of the COVID rules? Is China unraveling in real time here in front of ours in front of our eyes? What do you see,
Peter Zeihan 5:36
when you’re dealing with a cult of personality system like China, you gotta be a little cautious of making bold forecasts, because we just don’t have all the information we need to know one way or the other. But that said, there seem to be two things at play. When you have a system that is tightly controlled as the Chinese system has been historically and is now things go one of two directions. Number one, called the personality means that the buck starts and stops with one dude. And it doesn’t matter how smart he is, he’s never going to be good enough to manage anything. And certainly not everything, because he can only work through people who are sick of fans, everyone else who was intelligent has been purged from the system a long time ago. And in that sort of environment, once people start to challenge the government in any form, it rapidly spreads to challenging the government and everything. And so since last Thursday, when the fire in her room she happened in these protests started, we have already seen the protests expand dramatically to not just be about COVID. But to be about democracy versus dictatorship. And we’re seeing Winnie the Pooh, will they not blank sheets of paper, which is kind of representation of, you know, gee, are you don’t really know what you’re doing anymore. It’s become personal in a week. And if that is allowed to continue, it will spin the entire system apart in Chinese history is replete with examples of how everything collapses in a matter of weeks and months, this could be one of those. Option two is a one man show cult of personality locks everything down in order to get it all back under political control, in which case any sort of economic dynamism dies very quickly. So neither of these scenarios are good for China as a country or good for China as an economic entity. And don’t forget that COVID is in play. The current state of COVID is more communicable than the measles and five times as fatal. And we just had several 100 super spreader events, and their vaccines don’t work. They don’t work at all. So we, if they don’t go into an immediate Nationwide Series of lock downs, we are talking literally hundreds of 1000s to millions of deaths a month concentrating what the United States did in three years, into a very short period of time, because we were exposed in stages, and half of our exposure happened after the vaccines came out. That’s not what’s going on here.
Robert Bryce 8:01
Well, so damn. So either way, you’re what you’re what you’re predicting what I’m hearing you say is that China is facing a precipitous fall either way they go. And that is going to have ramifications across the global economy because it’s so important in terms of supply chains. Demand for oil. I mean, could this result in in a in a global recession or global crash and particularly in commodity prices? Because of China’s role as a massive consumer of everything from crude, tin and aluminum?
Peter Zeihan 8:35
Well, I mean, to set China aside for just a second. Yeah, so many things are going wrong all at the same time. As soon as we got to the end of the Obama years, and it was clear that the Americans were done maintaining globalization first Trump now Biden, we’ve always known we were gonna get here. And on the China relationship, we’ve always known we were gonna get here whether it was because of ethnics ethics or genocide or jobs or trade security or intellectual property theft or fascism or race it you know, whatever method you want to use to evaluate, we’ve always known that the bilateral relationship was going to collapse. Whether it was going to because of something on our side, something on their side, something in between, we always known it was going away. And we’ve always known that China was going to go away. Their demographics are the most terminal on the planet. And in history, the birth rate and Shanghai and Beijing are the lowest ever recorded and they just got revised down another 20% in the last two months. We now have a birth rate in China that in the last six years has dropped by 70%. And the Chinese are now admitting that they over counted their population by over 100 million people and all the missing millions are under age 40. So this was already a country in full demographic collapse that was going to cease to exist this decade. Everything that’s happening now with GE and COVID is just on top of that. Well,
Robert Bryce 9:54
let me ask you specifically about this recent event because I’ve watched it many times And to me, and I’ve talked about it with some other people, but it was at the Congress of the Communist Party Congress, and they escorted who Jintao out of the building, right? Yeah. And I watched it some, you know, I don’t know, 10 Maybe 15 times because reading the facial gestures and reading how dismissive Ji was of who and, and he and his own kind of surprise, wait, what is happening here? It was a purge in real time on television. Right? How significant was that? Because I thought there’s a movie script just to be written just in that, what, what, two minutes of video I thought it was just riveted by it? How did you ever see that? Well,
Peter Zeihan 10:37
let me give you the quick background. So you can understand the significance. After Mao’s disaster and the Cultural Revolution and the broad scale destruction that that generated, didn’t, didn’t show up, he was brought in. And he basically helped put the pieces together and came to a working agreement with the United States to join the globalist system. And as he was in his final years as ruler, he selected to relatively middle of the road bureaucrats who were technocrats from different factions to succeed him first, it was who didn’t show up in that way. Sorry, it’s been a while Gen Z mint. Sorry, I just got done talking to a different audience. So I’ve got different facts in my head. Gen Z, Gen Z men, and then who Jintao and so they both rolled for for 10 years. Jiang is from Shanghai, who is from the Beijing area, different factions, different geographies, they all like it was a good balance. But back when he did this, Deng knew that he couldn’t look forward on enough to figure out who was going to be there for the next 10 years. So he left it those two factions that he didn’t choose to select who the compromise candidate would be for number five. And that ended up being cheap. So when she comes in, he recognizes that he’s a compromise candidate. And he feels the need to break both factions, as well as all the others to make sure that no one can challenge him. So he called it an anti corruption campaign effort that dominated his first five year term, in which he got rid of everybody he saw as problematic. And then in the second five years, he went after the factions themselves to make sure that they could not function independently of him. And in this, who Jintao was broadly supportive, and by the time we got to the third party congress last month, he was the only one left. And so the symbolism of taking somebody who actually supported you, but was the last semi independent pole of power within the entire system, and publicly Mellon, scooping them from the political discourse. That was powerful. And it started what has now become a race among the sycophants within the current government of who can prove themselves to be more loyal. And as a result, we are seeing policy collapses across the entire political system. And COVID is just one representation of that we’re seeing this in relations with Russia and relations with the United States. We’re seeing this in the power sector, we’re seeing it in the financial sector, we’re seeing them in housing. I mean, the whole system is shaking apart. And I gotta admit, it’s kind of entertaining to watch.
Robert Bryce 13:22
entertaining but damn scary, isn’t it? I mean,
Peter Zeihan 13:24
totally scary, but I don’t live in China.
Robert Bryce 13:27
Well, and I want to come back to why you’re bullish on the US I am as well, in my last book, my fifth book, I talked about why the US has so many advantages, right, geographic demographic, etc. We’ll come back to that. But what I mean, just cast this forward in terms of commodities and because China has been such a massive absorber of every kind of commodity around the world and a massive exporter of labor intensive goods, including Apple iPhones, what does this mean for Apple, let’s start with them,
Peter Zeihan 13:54
are wobbles totally screwed in the term Apple is the American company that has refused to see the writing on the wall. And every time there has been a hiccup and relationships, whether it’s the trade fight started under Obama getting serious under Trump getting codified under Biden, whether it’s werewolf diplomacy, genocide, Hong Kong, whatever it happens to be, Apple has doubled down. And now 91% of their supply chain is dependent on mainland China for in some way. And so we are looking at Apple as an institution, as a firm See, seem to have a product set for several years until they can rebuild that supply chain somewhere else. Now, if this had been a normal company, I would say that it used to be the end of the firm, but Apple has like 18 bajillion dollars saved up right now they can afford to go out and rebuild their supply chain and other places. But if that’s not something you do in two, three or four years, so we’re probably done with iPhones until around 2020.
Robert Bryce 14:49
Say that, again.
Peter Zeihan 14:50
It’s going to take them five to six years to rebuild the Supply Chain system.
Robert Bryce 14:54
And so, so well, I mean, there were some of these demonstrations were focused right around Foxconn, which was Their biggest supplier right and Apple was trying to quell this. And and
Peter Zeihan 15:04
there’s a reason why Tim Cook is not saying anything about this because there’s nothing he can say that can fix this. They just need to rebuild the entire manufacturing supply chain elsewhere, almost completely from scratch.
Robert Bryce 15:14
And we’re talking about the the most VAT well, we don’t know whether Saudi Aramco what their their market cap is, but we’re talking about the most valuable company in the world here. Yeah. They screwed up badly. So let’s talk about when I when we set up this interview. And when we talked here in Austin, I said, I want to talk to you about China that will now China has really interrupted the queue. But we also talked about Mexico, and you talk about Mexico in the book as being the most important trading partner for the US for the coming decades. I live in Texas, I know you used to live here in Austin, and I’ve been to the border. I’ve been to Mexico a few times, not recently. And we talked in fact, when you were here in Austin, about Mexico is a failed state. And in some ways, it is a failed state. But you also point out that it also has many advantages, including demographics, and obviously proximity to the US. NAFTA, talks about Mexico or reprise, if you don’t mind what you talked about in the book, but also how you see Mexico now is its importance with the collapse of collapsing of China only then grown greater than in the US since you tie it since the book came out how you.
Peter Zeihan 16:20
I mean, let’s start with the big shocking thing in terms of value add, if you compare the value of things that Mexico starts working with, to what they actually finish their exports, they are the highest value add economy in the world. They’ve got a workforce that is larger and better skilled and with a better industrial plant than the entirety of Central Europe all ready. Now, there are a lot of things about Donald Trump, I’m not a fan of but NAFTA, two negotiated in the way that it was implemented in the way that it was was a stroke of genius, it was very, very well done. And in most economic sectors, Mexico is already one of our top three trading partners. And overall, they officially passed China this past year to become our number one trading partner. And that’s a position they are unlikely to give up in our lifetimes. In terms of manufacturing, because that’s where it gets really sexy. We have out shored offshored our industry a lot because of globalization. And the Chinese have taken full advantage of that. And by design, because we brought the Chinese into the anti Soviet coalition during the Cold War, and having the Chinese subsidized basically pay us to buy their stuff. That was a great deal if you were involved in anything except for a manual American manufacturing. Well, now with the Chinese system breaking down and the Mexican system really hitting its stride, a lot of this stuff was already coming back. Mexican workers are very high value add American workers are very highly, very high value add. And with energy and commodity prices all over the place for the last decade, incrementally, we have already been going through the fastest industrialization process in American history, a part of that’s the shale revolution. But now that China is experiencing tectonic problems, we should expect the pace of this to accelerate considerably, because we are now in a position where we are likely to lose manufactured goods out of Germany, and China at the same time, at scale. And so Americans have a very simple choice to make. We can have high inflation and not have goods. Or we can build our own industrial plant with the Mexicans and have the fastest economic growth in our history. I mean, this is not a hard decision to make.
Robert Bryce 18:37
Well, and you may and you made that point when you were here in Austin as well talking about the fact that German industry has decamping for the US and BASF is one of those companies, right? The biggest chemical maker in Europe, one of the biggest in the world.
Peter Zeihan 18:49
And BASF is not just important, because it’s huge. It’s important because it’s the producers, the base material that allows all other German manufacturing to happen without the Russian natural gas coming in any longer. BASF knows that its economic viability within Germany is already over. And so they’re relocating everything they can to to primarily Louisiana, because that’s where the natural gas is, but that won’t save the rest of Germany.
Robert Bryce 19:14
You know, they announced that they will just in the last, what, four or five months to two expansions of their facility in Geismar, Louisiana, which was one of one of those right but and then Volkswagen just in the last few days saying, oh, yeah, we’re not gonna build batteries here, forget it, we’re out we’re gonna go build these batteries somewhere else and they and it was the CEO of the Volkswagen brand said it’s not just batteries, it’s any energy intensive material so that the just to repeat you’re saying the deindustrialization of China and or Germany together then only accelerate the the ties between US and Mexico? So what about Canada? Canada’s not gonna be as important. It’s a third of the size of Mexico roughly. Talk about Canada then for a moment if you don’t mind.
Peter Zeihan 19:55
I don’t want to suggest for a moment that Canada doesn’t matter at all. Let me rephrase that. I totally love soccer. See that Canada’s a moment. But the key thing to remember about the United States Mexico relationship is we have different skill sets, we’re good at different things, we’re good at different price points. And in whenever you’re doing a manufacturing system, you need different labor skill sets at different price points, and the border region is perfect for that. Canada, not so much Canada’s quality of work is very similar to the United States, their cost of labor is very similar to the United States. And so Ontario can integrate with the lower 48. Like it was a 49th state. And that’s not nothing. But the the room for growth is limited, because it’s not taking advantage of a dramatic change in the international environment, like Mexico will be. Canada is simply an already integrated part of the American economy. Mexico is filling a need that we haven’t had until very recently.
Robert Bryce 20:57
And they have the labor. Yes. and Canada, not so much. Right. You know, they’re they’re
Peter Zeihan 21:02
kind of topped out. The only way we get fresh labor into the Canadian system is immigration. And they’re the world’s leader at attracting immigrants on a per capita basis. But they’re also on a bit of a treadmill, because they bring in people in their 30s and their 40s, who drop a lot of cash, buy some property distort the local markets, and then, especially recently move on. So we’ve had a huge amount of Chinese capital go in and distort Canada to the point that a lot of people in Canada can’t, or sorry, a lot of people who were born in Canada can’t afford to live in Canada. And but the Chinese that come in are dropping their money, but not working there. So they’re getting all of the distortions and none of the advantages to the labor market.
Robert Bryce 21:41
So it’s somewhat similar to the Chinese decamping for Australia, right? They’re buying expensive real estate in Sydney, or they’ve been in candidates. And the same
Peter Zeihan 21:50
thing happened in New Zealand. And so the kiwis and the Canadians have now barred foreign purchases of their property, Australian United States at the present have not done that. So we’re going to be seeing a little bit more concentration of that kind of distortion in some of the gateway markets.
Robert Bryce 22:05
Gotcha. So we’ve covered Mexico there, but Well, actually, I want to ask about, we talked about this when you were here in Austin, just briefly is, it has hallmarks of a failed state because of the narco problem, right? No,
Peter Zeihan 22:19
no, I would argue at least half of that is our problem, because we really love our cocaine in this country. And as long as that is the case, there is going to be a smuggling route for the cocaine to get in. And the cartels are a very serious threat. And they’re becoming more serious. So the background the Sinaloa cartel has been the most powerful organized crime group in the world for several years, and they have crossed north of the border and under the Obama administration, they were identified as public enemy number one. And El Chapo, their leader with became our most wanted person. And after a lot of back and forth with the Mexicans, we captured him, he escaped, we captured him again. And now he’s serving out multiple lifetime prisons, he’ll never see the light of day again. And the Sinaloa Cartel is starting to disintegrate. In many ways, that’s a problem. Because under El Chapo, it was run as a business. cocaine smuggling is what they did. And so you didn’t engage in side businesses you did not corrupt local government, you did not shoot the locals are robbed the local churches that would encourage people to turn against you. With El Chapo gun that’s kind of falling apart, it’s become a lot more violent starting to fracture, and a new faction, the politico new generation cartel is rising up and it is hyper violent. And the first thing they do and they move into a town to shoot a bunch of people, and they run cocaine on the side, they are in the process of challenging the other cartels for control of all the plaza access points on the border. And if they managed to successfully cross it, just one of them. Well, then White Chicks named Debbie and Dallas are going to get shot. And our view of Mexico and the drug war is going to change dramatically in a very short period of time.
Robert Bryce 24:06
You said cocaine, but it also fit nil and opioids. I mean, this is the other big part of the influx of contraband from Mexico into the US. And yeah,
Peter Zeihan 24:15
I don’t mean to suggest that those are not important they are but the sourcing for that is very broad based. The Mexican cartels are only part of the constellation for the supply of those.
Robert Bryce 24:24
Gotcha. So but to bring it back to that idea about them the violence and the and you know, I’ve watched it from a distance I cannot speak of any of this firsthand, but it just seems that this violence and the the lack of rule of law were to put a different way the strength of the cartels in many of the provinces in Mexico, this is a problem but you’re saying that the Mikayla industry and the other industries that are industrial that are going to be important to trade for the US. We can be somewhat immune from that. That failed part of the Mexico State is that a fair way to put it
Peter Zeihan 24:54
immune might be a bit strong part of the problem. Insulated maybe yeah, degree. It’s flooded a part of the problem with the cartels is that in northern Mexico and in southern Mexico, you’ve got a topography that is relatively difficult for governments to control. So in the North, you’ve got a highland desert, in the south, you’ve got tropics, it’s just difficult for states to experience to push their written areas like that. That’s one of the reasons why central Mexico has as a role been less violent in that sort of environment, especially when the cartels consider drug running to be their primary source of income. There’s nothing that says it has to overlap with traditional routes, because if you got one guy with a backpack with 20 pounds of coke, you know, that’s a lot of cash, he doesn’t need a container to do that. And you can have the two operating side by side with a degree of insulation. And the violence itself is usually never more than one or 2% of the physical land area of the country at any given time. So if you got a security team with your operation, who knows how to keep their ears to the ground, they can figure out what’s coming and when to shut down and who not to deal with and it can be managed. The challenge moving forward is if hola SCO really does get control of a plaza, the plazas are where the illicit goods transfer through. And that’s to close. El Chapo and the Sinaloa use those but they don’t interfere with trade because they realize it’d be bad for their business elemento and the lisco generate new generation cartel would probably have a very different operating strategy. And when you’re
Robert Bryce 26:27
talking about the plaza, you’re talking about the Socolow the center of the town you’re talking about that they wouldn’t operate, the cartels won’t be on the
Peter Zeihan 26:33
fringe of town, specifically, the trade arteries where they cross the border.
Robert Bryce 26:37
Okay, so the plazas you’re talking about? Okay, so the the access points to get to get into the into Texas or into California would bring the choke points what you’re saying. So if they control or start to control those, those border points, then it’s a different story.
Peter Zeihan 26:51
Yeah, right now, there are contested, and most of the violence, almost all the violence is on the south side of the border. But if they do seize control of the one and they have unrestricted access to the United States, that would threaten trade. Now. When you’ve got a cartel with one dude at the top, who’s calling all the shots, it’s kind of like what’s going on in China. If she were to die tomorrow, you would have national disintegration in a short period of time because there’s no other source of authority. The same with Politico new generation. So if elemento were to slip in the shower and fall on some bullets tomorrow, you know, the forecast change
Robert Bryce 27:26
slip in have having to be executed by an AK 47. Yeah, well, that’s unfortunate shower that the other key theme I would we talked about here in Austin, but as also a key theme in your book is the idea of the Bluewater Navy and the US Navy and its importance to global trade. I had another guest on the on the podcast and now I’m bringing it up. And of course, I’m forgetting his name right. esterbrook his book on the the Bluewater Navy in the US was really important talked about the evolution of the US Navy, you’re one of your thesis points that you’re talking about in the book is that the US Navy is no longer going to be the COP of the global oceans. Is anything changed since in the interim? Does that make you think that Congress is gonna appropriate enough money for the Navy to to have more than 300 ships that would bolster the Navy to bring it back where we’re at? What’s your thinking on that lately?
Peter Zeihan 28:19
No. And even if Congress did, it wouldn’t matter. So if you want to patrol the ocean blue for commerce, in an environment where you are not the only Navy, you’re gonna need about 800 destroyers. We’ve got 70. So the naval buildup that will be required if that’s a role we want to play, it’s simply beyond something we could do anything less than a 50 year time frame. So I suggest you put that out of your mind. Also, at the end of the Cold War, we decided to concentrate our Navy in terms of combat power into the super carrier battle groups of which we now have 11. And those are great for knocking off countries, but they’re horrible for patrolling because they can only be in 11 places at one time, assuming they’re all deployed. So even if we wanted to, we are now technically incapable of patrolling the global oceans. That doesn’t mean that we’re giving up the Navy not even remotely Our Navy is conservatively eight times as powerful as everyone else’s combined. And the world’s second and third most powerful Bluewater navies are Japan and the United Kingdom. So you know, those those three countries in terms of naval cooperation get along the best of any three navies in the world. So that eight to one if anything is probably closer to 15 to one. But that is designed for combat power, it is no longer designed for global patrol.
Robert Bryce 29:42
So when you talk about that you’re specifically talking about piracy then and the ability of the Navy to stop the stop piracy on the high seas like offshore Somalia or other places like that
Peter Zeihan 29:52
with piracy if a government is involved, call it state piracy or privateering. But yeah, we should expect to see a lot more of all of that
Robert Bryce 29:59
and So I had a, you know, a little brain mishap there. But the book is the blue age how the US Navy created global prosperity by Gregg Easterbrook, he puts forward a similar similar thesis that the importance of the US Navy is hard to overstate and terms since World War Two, which is a point that you make as well and usually agree. But what followed through on that, so is it going to be China being being more active or belligerent in the South China Sea, what so what is
Peter Zeihan 30:31
it might have 600 ships versus ours, but most of them are very, very small, and only 10% of them can sail more than 1000 miles from the coast. And honestly, it’s not even that good. Because that 1000 Miles assumes that they’re going in a straight line and slow to save fuel. If they’re actually maneuvering, like you wouldn’t war, they can maybe go 350 miles from shore, it’s a coastal Navy, it is not a regional, much less a global one. And the country that is most dependent upon the Americans keeping the trade lines open, is China. So if they were to do anything so stupid as to challenge the US Navy, we would just park a couple of destroyers in the Indian Ocean base and cut the energy line from the Persian Gulf, and the China would collapse as a modern state within six months. You know, this, this would not be a hard war if it came to it.
Robert Bryce 31:18
Well, so then who’s the champion? I mean, where is this piracy? where’s this going to privateer?
Peter Zeihan 31:21
Everywhere? What is the answer? Because the Americans are no longer supporting the system. And so you’re gonna get regional powers, whether out of desperation or opportunity, looking after their own affairs in their own ways. In the case of the Persian Gulf, that means the Saudis are probably the greater threat to the Persian Gulf than the Iranians are. Now we’re seeing what’s going on in the Black Sea with the Russians are right now. And what does Europe look like in a post German system, you know, we’ve seen this movie before, it is not good for commerce.
Robert Bryce 31:54
So then what’s the way forward then if I mean, because you’re painting, if you one of the major, the macro themes of the book is that we’re gonna see a lot of reshoring. And this is going to be good for the US. And there’s a point you made during your speech here in Austin, that this longer term is going to accrue to the benefit of the US, which I think is likely true, because of demographics, energy, supply, geography, geography is destiny, a point you make over and over, but then who are who are going to be the big rivals, then if China’s falling, then who, and Russia is weak now who are going to be the principal rivals them for the US in terms of this next wave of growth is going to be Vietnam,
Peter Zeihan 32:29
who will the primer on that is book number three, that’s just the United Nations, and that I break down the countries of the future, as we think of them now and explain why there are really mostly failed places, and who the countries of the future are going to be. And we’re gonna have a series of regional powers that are capable of kind of creating a bubble of security in their own neighborhood, France and Western Europe, Argentina, and South America, Japan and East Asia, and a turkey in the Levant. Of those four since the book came out, the Japanese have found a way to cut a series of deals with the United States, both under Trump and now under Biden. And so basically, we’re seeing a fusing of the theoretical Japanese sphere of influence with with the greater NAFTA system. And I think before we get too far into this, the Brits are probably going to come along for the party as well. So you’ll have a kind of a super system based in the Western Hemisphere that the Americans reign over for lack of a better phrase, that we have the two secondary naval powers of the world that are participating in and then you’ll have these smaller chumps that have kind of MELHEM scooped out their own neighborhood. And the zones in between them just kind of come become No Man’s lands.
Robert Bryce 33:36
Well, let’s talk about the UK then because I’m looking at the UK and following you know, what’s happened in particular on the energy side there. They look to me, I don’t want to get too technical here, but totally screwed. I mean, just totally screwed, right being very charitable. They, they haven’t drilled the heyday of the North Sea as long past 15 or more years in terms of gas production, they emit now important, more than half of their natural gas, their electricity prices are through the roof. We’re seeing deindustrialization happening in Britain as fast or faster than anywhere else in on the European continent. And yet, you’re pointing to, as I’m hearing you, I’m hearing you correctly, that you’re still bullish on Britain over the long term,
Peter Zeihan 34:15
over the long term. I mean, they have to kind of get their heads out of their assets first. So when the vote on Brexit happened, they neglected to imagine what their next step was. They they believed the Brexiteers believed a little bit of their own propaganda that they could just come to Washington and get a better deal than they got with the EU. And when they tried that, under Trump, they discovered it was not true. And in order to get a free trade deal with the United States, they basically had to sacrifice control of their financial manufacturing and agricultural system. On January 5 of 2021, they swallowed their pride like okay, fine, we’ll sign and they sent their emissary over to sign deals on January 6, and other things We’re in play on January 6, and then Biden comes in and Biden is not nearly as Pro for free traders Trump was. So it’s in the wind still, basically, Britain has done what has happened to Britain is what it always feared it has devolved into a middle power that doesn’t have any leverage. And until such time, as they accept that, like the Japanese, they have got to cut humiliating deals with both the left and the right in the United States. And it’s got to be the same deal. Until they accept that they’re kind of stuck in this no man’s land. And it’s difficult for them to leverage what they do have to reshape their future. And in the meantime, everything that they had about the old European system is falling apart piece by piece with increasing speed. And that leaves them in the lurch they’re in now.
Robert Bryce 35:44
I mean, this could be very, it could be very uncomfortable and destabilizing, couldn’t it? I mean, we’re already seeing, you know, if the projections are for energy, poverty, even this winter, or if we look at next winter,
Peter Zeihan 35:56
and the more desperate the situation is, the faster we will get to a political reckoning in London, which will lead them in time to admit that they’re only future as as part of the NAFTA system. But they’ve got to get there at their own pace. But, you know, reality is pushing them there very quickly.
Robert Bryce 36:13
What is that line that a friend of mine put it, they need some market therapy was that the
Peter Zeihan 36:18
the markets have been very kind to the UK to this point, they’ve taken six years to make a decision. And it wasn’t until just this past year that the markets are really like, we’re kind of done waiting. Right?
Robert Bryce 36:29
Which was why we saw the pound fall so far. And then no, don’t
Peter Zeihan 36:33
get me wrong. Liz truss, made some mistakes, right. But that was the culmination of six years of mistakes.
Robert Bryce 36:41
Let’s talk about trust for a minute because I wrote a piece recently in real clear energy about I think it was there, I’m forgotten where I published it. But about Rishi Sunak coming in and reversing truss’s ban on or lifting the ban on hydraulic fracturing. It’s like, they can’t figure out what is there in their own interest. And they have enormous shale resources, but they have to drill and they have to frack and yet here was a Tory leader saying trust saying, we’re going to repeal the ban. And then soon as you know, she’s only in power for what six weeks soon that comes in immediately reverses course, how are you ever going to develop shale gas in Britain, if you have the Tories saying we won’t drill?
Peter Zeihan 37:16
Well, one, we haven’t had the political break that’ll force all of this to be reshaped yet. And in that sort of environment, it is at the moment in the UK politically unpopular to fracking. And it’s not so much that technology, it’s the land ownership issues, because the government owns all the subsoil rights. And so if somebody comes into your house and says, I’m going to fracking your backyard, and you don’t get a cent from it, obviously, you’re gonna be opposed. You do the United States, you get royalties,
Robert Bryce 37:42
right? Yeah. No, that’s, that’s right. And then and they have or they’re having a similar conflict over onshore wind, and in Britain as well, which is something I’ve written a lot about the conflicts over land use and wind and solar siting. In Austin, when I heard you speak here, you said, I’m quoting, I think pretty much directly, you said, we could easily have 150 to $180 per barrel crude. And you talked about the January 1, the sanctions, expand and prohibit any Russia? Well, I guess it’s the insurance issue on Russian vessels that are carrying Russian goods. Talk about that, if you would, please wait, why are you? Why do you expect higher oil prices? And what are these sanctions effect on Russia? Why that are those kicking in? When they kick in? Why will it have such a big effect.
Peter Zeihan 38:31
So in a normal energy project, when the price drops too much, they shut in production. And then they restarted later and no one likes to do that it costs something that costs time and you’re not getting income in the meantime, but it can be done. But you can’t do that in the Russian permafrost. If the crude stops moving through the permafrost layer for any reason, it freezes into gel, and the water that comes up as a byproduct freezes into ice and when water turns into ice, it expands and it pops the pipe from the inside. What’s going on right now is the insurance ban on Russian vessels on January one will expand to any vessel carrying any Russian cargo. And at the same time the Europeans are about to enact their ban saying that no Russian crude whatsoever can be sold by any boat to any rock any European market. And that is going to force a degree of shut in in the ports, the pressure will build back up to the wells and then the whales will freeze solid. That’s going to happen pretty quick. And since the demand for energy tends to be inelastic, you get an outsize price response. So assuming for the moment that all else is equal, and I realized that is never true. You remove 4 million barrels a day of Siberian output and you’re gonna get $180 oil. Now. That was my forecast when I saw you last time since then the Chinese look like they’re going out of their way to experience an economic crisis. And if we see a drastic decrease in their ability to absorb crude, you know, that’s going to change the price forecasters So much in motion right now. But none of it is great.
Robert Bryce 40:04
Well, so then let me follow that up then. So it’s a question I’ve asked a lot of guests, and you’re long the US that you’ve made that very clear I am as well, I’m, you know, I’m a homer of the first order here, you know, but where does the smart investor then put money these days is, you know, I’ve had people, you know, gold bugs, and you know, we see what’s happening in crypto, you have a chapter, and I’ve heard you talk about the US dollar, it’s still for all of its flaws being the best currency and in a terrible global neighborhood of currencies. So where are you putting your 401k?
Peter Zeihan 40:39
I’m not a CFA. So let’s keep that in mind. This is not investment advice.
Robert Bryce 40:43
I understand. All of the podcast listeners here know to take everything with a big ass grain of salt. But where do you put your 401 K money then Peter,
Peter Zeihan 40:52
I like companies that center their production and their sales in North America, because we’ve got the highest value added labor system between Mexico in the United States. And we produce where we sell for the most part. Also, if the product is demographically driven, in terms of its demand profile, I like that. And if the end product is very energy intensive for its production, because we have the cheapest electricity and energy in the world, that’s great. And if the end product is exportable, that’s kind of like my trifecta. And so agricultural processing, petrochemicals, things like that are most of my portfolio. Since the Ukraine war started, I have gotten into commodities in a very big way. But I will caution you that most players in most commodity markets are truly global. And you want to make sure you are not exposed to Ukraine, or Russia or Brazil. Because the Russian system is falling apart, the Ukrainian system is unlikely to come back in Brazil is dependent upon material inputs that come from Russia. So you’ve got to be very, very careful, where you’re putting your money in that space, where you’re gonna get to get exposed to all the bad along with the good.
Robert Bryce 42:02
So when you’re talking about Brazil, and Russia, you’re talking about one of my previous guests on the podcast is Chris Lawson from the CR, CR G group. I’m sorry, he’s a fertilizer expert. But he was talking about exports of fertilizer, particularly from Russia. So you’re talking about Brazil’s reliance on Russia as an export market, but it also Brazil as an importer of Russian fertilizer, potash and nitrogen, etc.
Peter Zeihan 42:24
I don’t have the data in front of me, but on the whole, roughly 40 to 50% of Brazilian fertilizer inputs are sourced from the former Soviet Union, and most of the remainder is either China or the Middle East. So you know, there’s there’s no version of this picture that looks good for Brazil.
Robert Bryce 42:42
Well, let’s talk about food then. Because you also you talked about ag commodities. And, you know, I’m thinking in my head, soybeans, corn, you’ve in the last chapter, your book, I think you call it the third horseman. I think it is the long ride of the third horseman. And you mentioned it here in your presentation here in Austin at the secured finance network. Your outlook in terms of food supplies, and famine is sobering. Let me is that a sobering a good word for what’s your outlook,
Peter Zeihan 43:15
it’s a very calm way to put it.
Robert Bryce 43:18
And So walk me through why you are,
Peter Zeihan 43:21
let me make this a little bit more broad. Okay, so most of the economic growth that the world, not the US the world has experienced since 1990, is that we’ve brought in an empire worth of raw materials from the Russian space. And we brought in a billion workers from the Chinese space. And the outputs from both of those systems have allowed Brazil to bloom in a way that it never could before. We’re now seeing all of that in reverse. And if you remove a lot of the added fertilizer that’s come into the situation, then the two and a half billion people that we have added since 1990, are in some very real danger, because Brazil is the world’s second largest agricultural exporter. Russia is the world’s largest exporter of wheat, Ukraine is number five, and Canadian, Canadian, excuse me, Chinese capital has been part of what’s made this all work. And we’ve seen an increase of the Chinese lifespan by over 40% 50% Since 1990, you know, these things are all linked together. And when you take away the food supply that has allowed all of this to happen, we get to a very dark place very, very quickly, and you cannot replace fertilizer supplies quickly. Nitrogen and phosphate take a minimum of three years. potash usually takes 10 And so far, we’ve only lost roughly 1/3 of the former Soviet Union’s output of this stuff. And that has already been enough for almost every producer in the world to have gone through all of their reserves. The only reason we’re not in a food crisis already is because people had reserves and And Mother Nature was very, very kind to us this past year. There’s no way we’re going to repeat that next year.
Robert Bryce 45:06
And it’s simply because of Russia’s outsize role, I think Chris Lawson said they account for something like 20 or 30% of the of the waterborne trade in fertilizers. Right. And if they’re there, sanctions are going to affect that. But he said at that point that the Russian sanctions hadn’t touched the fertilizer market or their sanctions going to hit, if what you said before any Russian ship carrying or any ship carrying Russian goods can’t be insured. That takes all that fertilizer out. We
Peter Zeihan 45:32
were in this weird situation where the Biden administration is trying to provide letters of comfort, to point out to financiers and shippers that these things are not under sanctions in order to limit the damage. But if you’re a financial house, and you see the sanctions getting tighter, and tighter and tighter, and with every new genocide, that the Russians propagate, you got to wonder whether you want to be affiliated at all. So most to this point, of the reduction in fertilizer shipments, roughly 1/3 has been because companies don’t want to touch it not because they’re under sanction. What’s going to happen over the next years, we’re starting to see industrial accidents and a lot of these places, because most of the technology, most of the infrastructure that produces this stuff dates back to the 60s. And it’s only been held together since 1990. With Western duct tape and technical work and people shoehorning parts into it. That’s not happening anymore. So in the natural gas sector, we’re literally seeing explosions at gas processing facilities that you can see from space. And fertilizers, in many ways is a derivative of petrochemicals, especially for nitrogen. And because natural gas is caught up in the Russia European mix, the Europeans have stopped making it at all. So it’s not all just a direct interruption of Russian and Belarusian shipments. So we’re seeing pressure throughout the entire supply chain in the former Soviet and European space. And we’re only at the beginning of that.
Robert Bryce 46:56
So then walk us through. So put your get your crystal ball out there. And what happens to Russia then is Putin end up with a bullet in the back of his head drag through the streets like Moammar Qaddafi. What I mean,
Peter Zeihan 47:08
to me, if you were to die tomorrow, I don’t think would change the course of the war. The clique that runs the Russian system broadly sees the world from the same point of view as Putin. And so you might get a difference in style. But I don’t think you get any difference in the real approach to the conflict. And I don’t think the war would end. The question to ask is whether or not Russia is going to win or lose this, and we don’t know yet. We will know in May in June, because we’re in a bit of an operational pause right now. And because the Ukrainians are assimilating a lot of Russian gear that they’ve caught, that they’ve captured, they’ve captured almost twice as much gear from the Russians in the last three months, as they started the war with in addition to everything that’s coming from NATO. So by the time they’re done with that process, in the beginning of May, the Ukrainian military will have five times the capacity of what it started the war with. That’s just incredible. At the same time, the Russians growing large, half a million to a million more men into the war as well. So it’s going to be a very different war. But May is when mud season is over, and they can all maneuver and get at one another each other in a very big way. And we will know by the end of June at the latest who is going to rule at that sort of conflict, and then we can start making predictions about who’s going to win. But if Russia
Robert Bryce 48:21
is weakened, then it’s clearly will be weakened by this entire conflict and an increasingly isolated, doesn’t that pose a broader threat in terms of global harmony? I’ll use that word or if Russia is a weak, does it become a failed state? Does it become a narco state at an organized crime state? Is it the new Afghanistan what what is the future of Russia then look like when loser draw, it
Peter Zeihan 48:45
looks a lot like the history of Russia and inefficient state that’s run by a clip toxic, aristocratic class that oppresses everyone around it in a desperate attempt to find some security. I mean, this. We’ve seen this movie before. We’ve seen it at least 11 times.
Robert Bryce 49:02
And so well, and what does that mean, the gas flows ever then from Russia ever. It resumed back in two years that
Peter Zeihan 49:11
the explosion and output that we saw since 1990, was largely because of British Petroleum, or because it’s just BP now. And the Western services firms, they’re all gone. And so we know that those fields are going to decay in time independent of what happens with the sanctions or the tariffs or insurance. I don’t want to suggest that Russia is going to go to zero, but the longer this war goes on, the greater the chance that there’s going to be damage to the onshore pipelines, in addition to anything that the Europeans, the Americans and the Japanese do. So we should all consider that anything value added coming out of Russia and anything raw commodity coming out of Russia is going to drop precipitously, and in many cases suddenly, but we shouldn’t expect to see much of any of it coming back within the next several years because again, the last time it took 30 years to rebuild the capacity And that’s when the West was very tightly involved. We’re not anymore.
Robert Bryce 50:04
You mentioned it will. We’ve talked about commodities broadly. But yeah, I remember distinctly I made notes on it, you talked about Russia and neon supplies. One of the other gases that is critical for industry is helium and Russia is another big supplier of helium. So walk us through that you talked about me on and the replacement supplies is another example of how their Russia becomes irreplaceable in that What about helium as well, because that’s needed in industrial processing what I wanted to talk about those two, those two elements, but if you look at the entire commodity space, whether it’s rare earth elements, neodymium, you know, terbium, whatever, neon, or any, there are a handful of those that you look at as being the most constrained in terms of future supply.
Peter Zeihan 50:51
I’m not concerned about rare earths at all, that’s a processing issue. And the ore that produces rare earth elements comes from almost every mine in the world as a byproduct. So it’s just a question of building up the processing capacity. And once the Chinese started to try to blackmail the Japanese a few years ago, a lot of countries, the US included, built out some of that processing capacity. So if there ever was a shortage, we could kind of switch some years and within a few months have a domestic supply. So I’m not concerned about that’s like the one thing I’m not concerned about. Industrial gases are a messy space, because every gas has its own economics. But all of them are sourced from something called an air separation unit, which just takes the atmosphere and splits it into different chunks. Most air separation is done for oxygen and nitrogen as part of steel foundries. And that’s no exception when it comes to the former Soviet Union. The problem is it requires a second stage of separation in order to get the trace gases like helium and neon. And that second stage is usually done at a different facility that’s more advanced. And in the case of the former Soviet Union, where 80% of the stuff comes from that second stage was largely done in Marriott pole, and all the infrastructure has been destroyed. Interesting for those of you don’t know helium and neon are the two critical components in semiconductor etching lasers. So we are going to have a massive global shortage of semiconductor fabrication capacity within a year.
Robert Bryce 52:18
Which means car manufacturing, among other things will be much more constrained, we’re going to
Peter Zeihan 52:23
have to decide what goes back to analog for a while, it’s going to take two to three years to build out replacement infrastructure somewhere else.
Robert Bryce 52:29
So Intel planning to build this multibillion dollar fab here and Taylor, Texas, just north of Austin as part of its going to be part of this reshoring in particular, but they’re going to need these rare gas or these relatively rare industrial gases to make any of it work.
Peter Zeihan 52:43
And I need to pick that apart a little bit because it’s yes, ish. Several companies most notably Taiwanese, once, after the last scare we had with neon, which happened back in 2014, the last Russia Ukraine war, have invested a lot in recycling of the cartridges that have the neon on the helium, and they’ve made a degree of progress. And those recycling facilities are actually located in house. So there are some technologies under development with this and different kinds of lasers to try to slim down the need. It’s not happening fast enough, but it is happening. Intel’s not reshoring. That’s a fundamentally new technology that they’re implementing at scale. And most of the high end fab facilities that the Biden administration is encouraging fall into that category. The key they remember it with semiconductors that there’s different categories of quality, the high end that goes into servers, and phones and computers, that was already done here, as well as in Korea, Taiwan, Japan. And so when we expand our footprint of the stuff, we’re actually taking market share from allies. The low end the Internet of Things, your smart lightbulbs, that’s all China.
Robert Bryce 53:53
Gotcha. So I want to since you’re talking about China, you you have you’re on YouTube, you have a very successful channel on YouTube, you’re producing content all the time. I mean, you mentioned by the way, when we met here in Austin, and I do a fair amount of public speaking I 40 engagements this year, you told me then you are doing 160 This year, is that right in calendar year
Peter Zeihan 54:13
2015 Since then,
Robert Bryce 54:16
but your total engagements this year will be 160 speaking engagements, something like Oh, no, I’m going to top 180 180 certainly added 20. Okay, well, so that’s the tee up. We’re in this recent video about China, you’re talking about GE, and you said, and this issue of information rate and one man rule and you said I’m quoting you here, you said a person only has so much bandwidth. How do you have so much bandwidth? I mean, I’m staggered truly because I get tired of hearing myself talk and I can imagine hearing myself say, you know the same you’re not saying the same thing 180 times but to do anything that much. You have a speaking engagement every other day. How do you do it?
Peter Zeihan 54:57
Well, I’ve got a great team supporting me and if I ever implied that This was all me that was not what I intended. I apologize, no, no. And my job is to figure, my job is to figure out how the world works and look at it through the eyes of everyone who is in front of me. So I can explain to them the opportunities and the obstacles in front of them. I am not attempting to micromanage their business, there’s a big difference between helping people see the world through a new angle, and trying to micromanage a country of 1.4, excuse me, 1.2 billion people. One of these is an easier test than the other. And I have very open lines of information and communication to the world around late whereas G has built a wall.
Robert Bryce 55:40
So Well, you mentioned your team. So how many people do you have Zion on geopolitics? Is your firm? Is it an LLC? How do you how do you what kind of what kind of entity is it?
Peter Zeihan 55:49
Most of us are involved in research in some way, and we’re, there’s only only a half a dozen of us total. But then we of course, you know, outsource for people for contract work to do very specific things like graphics and web support.
Robert Bryce 55:59
Gotcha. So but I’m truly am impressed by your output. I mean, how do you have a photographic memory? I mean, like I mentioned the book, and I’ve seen you speak, I’ve heard you on podcast, I mean, the command that you have, and I’m not blowing smoke up your skirt here. But the command that you have over the amount of information that you deal with, and the amount of information that you turn around and make your own and then produce as content is, I mean, I’ve seen I’ve been to as my father used to say a county fair to go rope, and it’s damn impressive. How do you do it? Well, I’ve
Peter Zeihan 56:29
got two things going for me. First of all, I’m a generalist. So it’s all about drawing connections among different things. And every time I’m in front of an audience, I’m learning the world from a new point of view, you do that 180 times in a year, you got a book. And that’s where the last one came from, to be perfectly blunt. Second, I’ve identified the weak points in the International System years ago as part of my previous work. And so now that it’s all happening, I don’t need to reinvent the wheel, I can look at the work that we’ve already done in the past and say, Okay, we identified these weak points, this one is in play right now. And that triggers these events. So from our point of view, hard work is behind us.
Robert Bryce 57:09
And that’s the way you keep it fresh by saying, Oh, well, then I pull this out of the file cabinet, so to speak, and say, Well, this is what matters now. Because this is what happened then.
Peter Zeihan 57:17
And this is what you can look forward to happening next, because the next domino to fall has to be here.
Robert Bryce 57:22
Right? But I asked that question, seriously, do you have a photographic memory?
Peter Zeihan 57:26
No, but I would actually argue that right now I’m full. It’s like, I feel like I’m Johnny Mnemonic. Every time I put something in something else has to come out.
Robert Bryce 57:34
Well, okay, I would imagine. So are you reading? Well, so just a couple more questions here, because we’re close to an hour. So when you read books, you know of whoever I mean, you know, this is almost 500 pages. Are you reading other people’s works? And then digesting them and taking notes? How do you manage the inflow of invites use to
Peter Zeihan 57:56
I have not had time this year? There has not been? You know, in the past, I was big on structure books, or history books that studied overall trends, like Silk Roads was one of my favorites. Because it you know, talked about this concept of geography and how it played across the national politics and economics of countries going back 25 centuries. I loved that. I don’t have time for that kind of stuff.
Robert Bryce 58:21
So well, so one of the questions I have guests introduce themselves, and then I always ask them toward the end of the interview, what are you reading? Now? You mentioned Silk Road, who was the author of that? Oh, I
Peter Zeihan 58:33
was afraid you were gonna ask that. Sorry. I can’t remember off top my head.
Robert Bryce 58:36
No problem. But so you said you don’t have time. Are you reading any books now? Or what are you reading on a daily? No,
Peter Zeihan 58:42
I have been on the road all but seven of the last 95 days. So right now, I’m not reading anything.
Robert Bryce 58:49
Gotcha. But if you were so aside from dead Well, let me just press you a little bit. So aside from your own books, the accidental superpower, this one, What books would you recommend, besides your own to people who are interested in the in the geopolitical space are their favorites of yours?
Peter Zeihan 59:05
Well, I mean, the two obvious ones are guns, germs and steel by Jared Diamond, which remains the best example of how geography shapes economic development, going back to the beginning of human recorded history. Great book, you’re gonna learn a lot about chickpeas, just be prepared. But the intersection of climate and geography and axial trade is kind of a Hallmark and that kind of sets the stage for what’s possible. And if you’re looking for something that’s on the complete flip side, World War Z by Max Brooks, not the movie, the movie with hot trash, the book, and yes, it’s about zombies. I am not a zombie fan. I’m not a Romero fan. But he takes the entire human condition and changes one thing and shows how it remakes military strategy and technology and finance and agriculture and culture. And it’s, it’s an amazing case study of what could happen.
Robert Bryce 59:59
Good well Those are so as you mentioned, guns, guns, germs and steel is that you use that as kind of a model for how you do things, then to me, because it’s the top of your list here is that
Peter Zeihan 1:00:09
anyone who is in my space and says no to that question is lying.
Robert Bryce 1:00:14
Because he set the state level gave the term set the
Peter Zeihan 1:00:17
stage for how it could be done, and the rest of us aren’t copying. But while I don’t think without his framework, we would all be able to think about things in the way that we
Robert Bryce 1:00:26
do. So you stole the idea.
Peter Zeihan 1:00:30
like to think I’m paying homage
Robert Bryce 1:00:32
to well, it wasn’t Picasso or John Lennon or they’re both. They’re both given credit for this. This line, amateurs borrow professional steel. So there you go.
Peter Zeihan 1:00:42
Well, like I said, I’m not standing on the shoulders of giants. I’m standing on the shoulders of everyone.
Robert Bryce 1:00:47
Okay, so last question, Peter and Peter Zions work can be found pretty much everywhere. He’s the author most recently of the end of the world is just the beginning mapping the collapse of globalization. I said I was gonna give you one question, but I have to ask this one first. Because people ask me, Are you writing another book? Now? Do you have another book in mind? You’re awful busy to do. Besides, my
Peter Zeihan 1:01:06
publisher is leaning on me very hard. I’m starting to noodle over it asked me again in January because I haven’t had time to really flush it out. But I’m, I’m playing with a few ideas.
Robert Bryce 1:01:16
Gotcha. So the last question, then Peter, what gives you hope? We, we you, no one would accuse you of being overly optimistic. Who’s the what’s the Dr. Doom? The the guy from NYU, his name is slipping my mind right now. But your outlook on the world has a lot of cautionary notes. What gives you hope?
Peter Zeihan 1:01:38
Well, we are looking at the end of the globalized era. And that means unwinding a lot of the benefits of the globalized era. And there’s nothing about that that’s cheery, but we’re not looking at a systemic collapse of human civilization here. I mean, we’ve had a number of periods in human history where when the system broke, everything broke. I mean, Europe had a millennium long, dark ages. That’s not what we’re looking at here, the American system is going to hold, it’s going to expand, it’s going to thrive and is going to reach out and integrate with other parts of the world that are also going to do well. And they’re going to be secondary centers around the world, think of France think of Turkey, that are also going to do pretty well for themselves. This is not a vacation from history. This is an adjustment period. Now it’s an adjustment period that’s going to last 30 years. But on the other side of this technology is going to continue to advance. And when we get through this adjustment, it’s not that we’re going to pick up where we left off, but we will enter the next chapter of history. This is not the end. This is just a really really bad ShakeOut.
Robert Bryce 1:02:43
And it’s not going to last forever. Was Nouriel Roubini? The Dr. Doom from NYU he’s known as Dr. Doom and I’m not suggesting you’re Dr. Doom but
Peter Zeihan 1:02:56
anyway been called worse.
Robert Bryce 1:02:59
Well, listen, Peter, it’s been a joy I appreciate your the hour that you’ve given us. You can find Peters work online pretty much everywhere. Check out his new book, The end of the world is just the beginning. I highly recommend it. remarkable book. Congratulations on your success. I mean that genuinely it’s it’s got to feel good to see the you know how your career has,
Peter Zeihan 1:03:20
has blown up. It’s been it’s been a wild ride. I could have never predicted this.
Robert Bryce 1:03:24
It’s it’s been impressive. So good luck to you and to all the people out there in podcast land. Thanks for tuning in to this episode of the power hungry podcast. Until next time, see ya!