Brace Yourself For The Collapse Of Modern Society - Peter Zeihan

1. 0:00 – 0:21

   Intro

   1. PZPeter Zeihan0:00

      Best guess is that China only has 1.3 billion people now. The population probably peaked more than 10 years ago, and by 2030, there will be more retirees than workers, and by 2050, the entire population of China will have dropped below 650 million.

   2. CWChris Williamson0:15

      That's wild.

   3. PZPeter Zeihan0:16

      It's beyond terminal. (air whooshing)

   4. CWChris Williamson0:20

      How

2. 0:21 – 8:12

   The End of Globalisation

   1. CWChris Williamson0:21

      real has the progress and prosperity of the last century been in your opinion?

   2. PZPeter Zeihan0:26

      Oh, it's been fantastic. Uh, this has been the greatest time to be alive. The combination of the American security umbrella plus globalization, uh, has changed the way we lived. It's, uh, allowed everyone to benefit from global trade. Um, before we had that, if you didn't have oil locally, you didn't have transport fuel. If you didn't have coal locally, you didn't have electricity. If you didn't have good food locally, you didn't have a population. Globalization, safe globalization, enabled anyone to trade anything that they could produce, even if it wasn't a commodity, and join the system. It was like everyone had won World War II all at once. It's, it's been a great ride, and now it's ending.

   3. CWChris Williamson1:07

      Was it inevitable that it was going to end? If you'd gone back a century ago and been able to change policy globally, could you have done something differently back then?

   4. PZPeter Zeihan1:19

      Uh, a century ago, probably not. There's a, there's a couple problems here. So, first of all, when globalization really got going in the '50s, we started moving off the farms and into the cities to take manufacturing jobs. Now, when you live on a farm, kids are free labor. You have a whole scad of them. But when you move into a condo, kids are just really loud, expensive mobile pieces of furniture, and adults aren't idiots, so we had fewer. You play that forward for 70 years, and it's not that we're running out of children. That happened 40 years ago. It's that we're running out of mature adults. And so, the economic model of globalization is consumption-based and it just doesn't work without people. So, we've always known we were gonna get here in the end. Just happened. Uh, the Americans forced the issue. At the end of the war, we told everyone that we would patrol the global oceans so that anyone could send any cargo ship anywhere to trade in any product with any partner. That's what made globalization work. Now, we didn't do this because we were nice. We didn't do this because it was a trade program. We did this as a bribe. This is what we gave everyone so that they would join us against the Soviets. The Soviet Union collapsed in 1992, so Americans have been electing evermore isolationist and populous leaders ever since. So, for you to believe that globalization can continue, you have to believe that, A, it doesn't require consumption anymore, and B, that the Americans will continue to bleed and die so that the Chinese can get ƒ. You know, that's a bad bet.

   5. CWChris Williamson2:52

      Before we start talking about where we're at and what that means for the future, is there anything else that we need to understand about how we got here, about any of the fundamental principles that we're going to be talking about?

   6. PZPeter Zeihan3:02

      Uh, we'll bring them up as we go, but those are the two big things, the demographic flip, well past the point of no return, and the Americans have largely checked out.

   7. CWChris Williamson3:10

      Mm. You said that 2019 is the best that the world will ever be. What was particularly special about that one year?

   8. PZPeter Zeihan3:18

      So, think of your demographic profile as a pyramid. Children on the bottom, retirees at the top, mortality built it into a pyramid. As we, uh, industrialized and urbanized, it became more of a column, and then an- eventually an inverted V with more mature adults than children. And 2019 was the last year before the Baby Boomers really got into retirement in a big way, so we had this massive postwar generation throughout the Western world that were all, on average, 63. So, (laughs) they hadn't retired yet, and all of their investments and all of their retirement savings were churning along, providing capital for the whole system. We still had a huge amount of consumption out in the world. But you fast-forward three years, this year, on average, they turn 66. So, it's over. We- we've lose their cons- umption. We lose their investment. They have to liquidate all their stocks and bonds and go into T-bills and cash because they won't have the ability to recover from a, a crash. Uh, and we're also seeing some of the fastest demographic aging in human history throughout the developing world, with China being the far most advanced. So, we're losing the investors, we're losing the workers, we're losing the consumers all at the same time. On top of that, we had Trump and we had COVID, and now we've got Biden, and then we had Brexit. And everything that used to tie it all together has been broken apart either on purpose or just because of the strategic trends that were already in play. We're never going back.

   9. CWChris Williamson4:52

      Consumers, investors, and workers. Those are the three main things that people of working age and above school age give us.

   10. PZPeter Zeihan5:01

       Absolutely, and we're running out of all of them. (laughs)

   11. CWChris Williamson5:03

       And you need those to continue to grease the system. They're the people that drive not only creativity in terms of pushing technological progress forward and bits and pieces, but they also inject capital into the system. They're the ones that are spending on consumer goods, so on and so forth. So, they just provide lubric- like, financial lubrication and also, uh, the, um, worker power, the employee, employee power.

   12. PZPeter Zeihan5:26

       Right. You can kind of split it into two general categories. Uh, for people roughly aged 18 to 40, maybe 45, those are your young workers, relatively low value add, uh, relatively low cost, but they're at the height of their consumption because they're raising kids and buying homes. So, that's where most of the economic activity that drives a modern system comes from.... once you pass 45 up until 65, the kids are moving out, the house has been paid down, but your income keeps going up. So the delta between your income and your expenses gets very, very large. And that's where all the financial heft comes from. But these are also our most productive workers because they literally have decades of experience. And from roughly 1985 until 2015, the world was in kind of the perfect balance because we had a lot of those countries with the mature worker demographics and then a lot with the younger worker demographics. What's happened is that countries who joined globalization in the second wave, in 1990s, mostly the developing world, they, uh, urbanized and aged out much faster than the rich world did. So when we hit 2015, that big chunk of developing world workers, the experienced workers, the productive workers, the ones who saved, they're now moving into retirement or losing their money or losing their skills. But because the developing world is aging so much faster, they're moving into their 40s and their 50s, but they haven't been able to build up the skillset because their systems were not as established. But their birth rates dropped faster than the West's did, so they actually have lower birth rates in many cases than most of the advanced world. So we've lost children on both sides of the ledger, and now our new mature workers just don't have the skillset to keep it up, and even if they did, they wouldn't have anyone to sell to.

   13. CWChris Williamson7:15

       When old people die, do they not pass their money down as either inheritance or inheritance tax? Does that not go back into the system in one way?

   14. PZPeter Zeihan7:22

       Th- they do, and if they died at age 66, that would be great from an economic point of view.

   15. CWChris Williamson7:27

       (laughs)

   16. PZPeter Zeihan7:27

       Uh, (laughs) unfortunately, (laughs) if that's the right word, uh, this, uh, people continue on for 20, 25 years after retirement. Now, this is gonna sound really weird, but in the United States, this is less of a problem. Uh, number one, our Baby Boomers actually had kids, so we do have a replacement generation. We know them as Millennials. Uh, we can talk about them later and all their faults, but ultimately, they're there, and that's a good thing. Uh, second ... we have a really high mortality rate among people over age 55 in the United States. The, uh, the delta between the average age of mortality in Europe versus the United States is in excess of 10 years, so we will get that churn a lot faster than Europe will.

   17. CWChris Williamson8:09

       Mm. That's interesting.

3. 8:12 – 15:52

   Why China is Most Concerning

   1. CWChris Williamson8:12

      Okay, so what, w- which countries at the moment have got the worst demographics? Which countries should be-

   2. PZPeter Zeihan8:20

      The worst?

   3. CWChris Williamson8:20

      Yeah. Which countries should be very concerned about the ratio of young to old?

   4. PZPeter Zeihan8:24

      Uh, the worst in the world is China. Uh, they've been in the process of updating their data f- over the course of the last couple years and they're now starting to publicly admit that they overcounted by 100 million people. All of those people would have been born since one child, so age 40 and under, the young worker demographic, the, the child-bearing demographic, and two-thirds of them are probably women. So we, best guess is that China only has 1.3 billion people now. The population probably peaked more than 10 years ago, and by 2030, there will be more retirees than workers, and by 2050, the entire population of China will have dropped below 650 million.

   5. CWChris Williamson9:04

      That's wild.

   6. PZPeter Zeihan9:05

      It's beyond terminal. Yeah, so the Chinese system collapses this decade for sure, ... assuming nothing else goes wrong and there's plenty other competitors to put the bullet in China's head.

   7. CWChris Williamson9:18

      Dude, that is crazy. Okay, so-

   8. PZPeter Zeihan9:23

      Yeah.

   9. CWChris Williamson9:23

      ... ?

   10. NANarrator9:23

       ... just g-

   11. PZPeter Zeihan9:23

       All the way from pre-industrial to post-industrial collapse in 45 years.

   12. CWChris Williamson9:28

       Uh, ... just for the people that don't understand about how the one-child policy and the preference for boys over girls and stuff created this landscape, what's the, what's the high-level view of that?

   13. PZPeter Zeihan9:40

       Sure. Well, there's two things. Um, first of all, of course, as one child, Mao was concerned that they had a young upcoming generation after World War II that was gonna eat the country alive. Uh, so they went to a two-child policy, ultimately to a one-child policy, and that was not loosened until 2015, but by that point, the damage was already done because there was a second factor. Uh, remember, countries that industrialize later can follow the path of those who came before. They c- can skip some steps. So China was the fastest ever industrialization experience. Uh, what the United Kingdom did in seven generations, the Chinese did in one. And so they crammed seven generations of economic growth and development into one, and that's why their growth rate has been so impressive. But you can only do that once, and now it's behind them, and now they have no children, and they have very few people under age 45.

   14. CWChris Williamson10:30

       Mm. Is this, is population growth and collapse similar to an R0 number in a way that more people allow you to have more children which gives you more people to have more children, but if the reverse is happening, then it causes a nosedive?

   15. PZPeter Zeihan10:49

       Uh, y- you're absolutely right there. Now, I'm, I don't wanna say that, um, unchecked population growth is necessarily the way to go. That's not what I'm after here. I mean, you require a balance between children, young workers, and mature workers. If you don't have enough mature workers, you don't have the capital. If you don't have enough young workers, you don't have the consumption. If you don't have the children, you don't have a future. China is already out of that, those last two categories. And so we know where this leads. It leads to zero.

   16. CWChris Williamson11:16

       Given the fact that humans are being, I think, it's every three generations lives for another generation at the moment, around about every generation lives eight years younger, longer than the generation before, increased healthcare, health span, better access to-

   17. PZPeter Zeihan11:29

       Okay. That is only true in the shift from pre-industrial to industrial.

   18. CWChris Williamson11:35

       So you get that once?

   19. PZPeter Zeihan11:37

       Uh, well, it depends upon how you apply the lessons to your system. In the case of Europe, I'd say they got it three times, um, but there's definitely an upper limit. One of the, the things to keep in mind, especially when you're talking about European demographics, is that Europe, in Europe, people are not living longer.... overall lifespan has not improved. What's improved is we've gotten rid of a lot of mortality. So the things that used to kill you when you were zero to 65 don't kill you anymore.

   20. CWChris Williamson12:06

       Right. Okay. That is going to change the shape of demographics as well, right?

   21. PZPeter Zeihan12:10

       Yeah.

   22. CWChris Williamson12:10

       The fact that young people are able to get old more easily, say.

   23. PZPeter Zeihan12:14

       More safely.

   24. CWChris Williamson12:15

       More safely, yeah, precisely. So I guess there's just a lot, over the last 100 years, we've seen such change, it's not just been technological change, but downstream from that is what's happened demographically and how-

   25. PZPeter Zeihan12:26

       Absolutely.

   26. CWChris Williamson12:26

       ... that's i- how that's influenced the demography. Okay, so if China-

   27. PZPeter Zeihan12:29

       Modern medicine, electricity, sewage.

   28. CWChris Williamson12:31

       Yep.

   29. PZPeter Zeihan12:32

       Yeah.

   30. CWChris Williamson12:32

       If China's got the worst, who, what are some of the areas that have got better-looking demography?
4. 15:52 – 24:46

   Causes of a Reduced Birth Rate

   1. CWChris Williamson15:52

      So for the people that maybe haven't been able to work out why it is that increasing urbanization and education and development causes a reduction in birth rate, can you just explain that for us?

   2. PZPeter Zeihan16:04

      Sure. Uh, it's, it's a wide array of factors. So when you move into a city, you have less room, and that just changes the mechanics of raising kids. Uh, when you move off the farm, kids are no longer free labor, you have fewer of them. Uh, when you urbanize, when you have electricity, you've generated time, and so people can do things after sunset. This is important for everything in terms of economic development, but it's most important for women, because if a woman moves off the farm and into the city and all of a sudden can do something after hours, you have the opportunity for mass education and freeing them from doing more than just being mothers. Nothing wrong with being a mother, but it's a full-time job on the farm. In the city, you're gonna have fewer kids, that's less time allotted, and you have a greater chance to, you know, read. And so the entire women's right movement is basically linked indelibly to electricity, and once you have it, women have fewer kids, because they now have other things going on in their lives that compete for attention.

   3. CWChris Williamson17:04

      Mm. They can go and get jobs.

   4. PZPeter Zeihan17:06

      Yeah.

   5. CWChris Williamson17:06

      They can pursue careers. They can do research, yes, interesting.

   6. PZPeter Zeihan17:10

      We absolutely ... I mean, the British example with the, uh, the cotton mills was probably the best example. The first group of people to urbanize weren't the men. It was the women, and we saw the impact on birth rates.

   7. CWChris Williamson17:22

      Going back to what you said there about food shortages and the delicacy of agriculture, I'm seeing a lot of videos, uh, come out, shaky phone videos come out of China at the moment. Just how bad, uh, i- is there any, uh, reliable information about how bad food and the future of food will be in China?

   8. PZPeter Zeihan17:39

      It's getting difficult to get good information out of China. Its really deman- uh, devolved into a cult of personality state even stricter than what, uh, Mao Zedong had. Uh, I don't think that the Chinese have an, a food crisis that is impacting their ability to have calories at the moment.Um, Chinese land is among the worst in the world, and so it requires a huge amount of fertilizer to grow anything, specifically phosphate for rice. Uh, it's by far the world's most phosphate-hungry crop, and the Chinese traditionally, because of that, have been the world's largest producer and exporter of the stuff. Uh, the problem is actually with African swine fever. Now you may have heard of that a few years ago. They had a big outbreak. They ended up culling more hogs from their farms, and the rest of the world's commercial h- farms have hogs. Just to give you an idea of just how lopsided the pork market is, (laughs) it's two-thirds of it is China. Uh, they went to rebuild their herds, but they never abrogated the debts for the farmers who went out of business. They just offered subsidies to bring in new people. They thought that would be cheaper. Well, you have now two million new hog farmers in China who have no idea what they're doing. And let's just say that, uh, phytosanitary does not translate into Mandarin well in the first place. So we're probably in the early stages of a second wave of ASF that'll probably be just as bad, if not worse, than the first one. So pork, just like it did two, three years ago, is about to fall off the market in China completely. That just leaves rice. So the Chinese have banned the export of phosphate fertilizer. In the short term, this is causing massive problems in agricultural producers in East and South Asia. Australia, especially Western Australia, is probably the part that's get- gotten hit the hardest. Uh, Brazil is feeling the impacts 'cause these are... Western Australia and Brazil basically can't grow without fertilizer. They don't have soil in the way that we think of the term. It's a weird geology. Um, but you interrupt the input flows, and it's very difficult to grow food at volume. And China, in the best of times, is on a razor's edge in terms of food sustainability, and they use about three to six times as much fertilizer as is used in the, the global average just because their land is so poor. Uh, luckily, phosphate, they've got covered. They produce that themselves, but the nitrogen is all made with imported natural gas, and the, uh, the phosphate, half of... I'm sorry, the potash, half of that comes from a different continent. So yeah, China demographic collapse, unavoidable. Food collapse, highly likely. And that's before you start talking about things like energy manufacturing and trade.

   9. CWChris Williamson20:20

      Does this not make China unbelievably dangerous?

   10. PZPeter Zeihan20:25

       The question is, what would you do if you're China? Where would you go to get what you want? You could go into Kazakhstan, fine, but you know, what does the winner get? You can't go to India. The Malay is in the way. You could go into Vietnam, but when the Vietnamese... When the, um, I'm sorry, when the Chinese did that last in 1979, they got treated just as well as the Americans were, and so that was a quick war. They don't have the navy to push out. Japan and Taiwan could go nuclear in a month.

   11. CWChris Williamson20:53

       Hang on. The-

   12. PZPeter Zeihan20:54

       That just leaves Russia.

   13. CWChris Williamson20:55

       ... way you heard, uh, there's China are taking over the South China Sea. There's all of these small islandettes that they're putting together. They've got this scary, big armed forces that's gonna come and take over everything, and uh, is that not the case? Are they not as strong militarily as they have been, we've been told?

   14. PZPeter Zeihan21:14

       Really not. Um, they have made significant strides over the last 30 years. I don't mean to belittle that. But everything they're doing in the South China Sea was designed to intimidate Vietnam and the Philippines into cowering, and it had the opposite effect, and both countries just ran to Japan and now have defense pacts. Uh, it doesn't really allow the, the Chinese to project power very far either. Uh, they do have a lot of ships. They've got like a 650-ship navy, but 90% of them are really small and can't sail more than 1,500 kilometers from the coast. And that assumes they're going slow in a straight line and no one's shooting at them. In actual combat conditions, they can maybe make it 600K. So it's... They don't have the power projection, and they're the country in the world that is most dependent on reaching the world in order to reach markets and resources.

   15. CWChris Williamson22:05

       Okay, so that's demographics. How does globalization play a role?

   16. PZPeter Zeihan22:09

       Well, if the Chinese can't reach Europe, they lose their largest market. If the United States throws a trade war, they lose their second-largest market. If they can't reach Africa, they lose raw material resources. If they can't reach the Persian Gulf, the lights go out. They're completely dependent on globalization as maintained by the Americans for the entirety of their economic and cultural system.

   17. CWChris Williamson22:31

       What do you mean when you say, "As maintained by the Americans?"

   18. PZPeter Zeihan22:33

       The United States is the country that guarantees freedom of the seas, or traditionally, that has been our role since World War II. That's what we're getting out of... And we're... There's gonna be this little fun thing with Ukraine more that's about to happen. (laughs) So, I don't know how much you've been following that, but the Europeans have done an insurance ban, uh, which has dissuaded most reputable carriers from taking Russian crude to China. So the Chinese and the Russians rented a bunch of supertankers, lashed them together into a raft off the coast of Portugal, and they're bringing shuttle tankers from Russia's ports, which can't take supertankers, and doing C2C transfers in the middle of the Atlantic. I, I can't wait for somebody just to doo, doo, doo, doo, doo, doo, doo, doo, doo, doo, doo, and just grab it. Uh, it could be Portugal. The Chinese don't have the naval capacity to put anything that far out, neither do the Russians. But someone soon is gonna do that, and that's gonna shut down the entire energy trade out of Russia. I'm a little surprised it hasn't happened already, but it's gonna be a fun day when it does go down.

   19. CWChris Williamson23:30

       Dude, that's wild. I mean, how much-

   20. PZPeter Zeihan23:32

       Yeah.

   21. CWChris Williamson23:32

       How much oil are you talking about here? Because presumably if someone was going to do a small act of war, in order to take it, it would have to be a worthwhile amount of, uh, fuel that they would need.

   22. PZPeter Zeihan23:41

       Well, you wouldn't... You probably wouldn't do it just because you wanted the oil. You would do it because you want to disrupt the Russian financial system 'cause this would destroy it. Uh, one supertanker, the insurance policy on one supertanker is gonna run about a billion dollars. The Russians only have $5 billion put aside for this. So not only would you disrupt the immediate transfer, which probably would affect-... I'm just spit-balling here 'cause the Russians aren't talking, but let's call it two to three million barrels immediately. But anything else that was in the chain going back to the Russian ports, probably another 10 or 15, um, million. I'm sorry, I said billion earlier. Two to three million barrels. There's probably another 10 to 15 million barrels on shuttle tankers on their way there now, and then all of a sudden, the ports get clogged, and then the pipes get clogged, and the pressure builds up into Siberia into the permafrost and the wells freeze. And that's it for Russian energy for 30 years.

   23. CWChris Williamson24:37

       Dude, everything is so interconnected.

   24. PZPeter Zeihan24:39

       Mm-hmm. And fragile.

   25. CWChris Williamson24:42

       (sighs) Okay, so that's globalization for China. You mentioned that

5. 24:46 – 29:45

   Relying on US Security

   1. CWChris Williamson24:46

      the US was kind of like the police of the sea, and they're getting out of it. What does getting out of it mean, and what did police of the sea mean?

   2. PZPeter Zeihan24:53

      Well, part of globalization was making sure that everybody's commerce could go anywhere. In the pre-World War II environment, unless you were an empire with a navy, you didn't trade. Um, you couldn't because the empires were in charge. Uh, when the empires died in World War II and the Americans took over the global structures, uh, we decided that rather than having a single American-led structure that was designed to siphon off energy and food and resources and money to the United States as an empire would, we would instead prioritize security versus the Soviets. And so, we provided the economic backdrop, the security backdrop that was necessary for everyone to play. And that's the world we know. That's what we've been living in. The Americans make sure that piracy is under control, they make sure that hostile countries can't reach commerce, and they generally provide policing actions. Uh, not to say that we've done it great at any given day, but that, that's been the plan and it's broadly worked. Since 1992, we've been backing away from that. We've been closing down our o- o- overseas bases. We've been retooling our military so it's not destroyer-heavy and assigned to patrol, it's carrier-heavy and decide to, and, uh, designed to hammer things. So we now have 11 supercarriers. By the end of this decade, we'll have 14. One of them is more powerful than all but nine of the air forces on the planet, and that assumes a fair fight. And the whole idea of a navy is it's never a fair fight 'cause ships move. You know, we learned this from you. Uh, and so it's really one of their new supercarriers can take on any but one of three air forces in the world, and we ha- are gonna have 14 of 'em. Uh, so that's great if you wanna knock off a country. If you wanna patrol the global oceans, no, no, no, no, no, 'cause you can only be in 14 places at once, and that assumes they're all at sea, which never happens. So we no longer even have the military structure that is necessary to guarantee global commerce. No country in the world does. So the most likely outcome of this is we'll get a series of regional powers that have military force that is capable of kind of making a bubble, little sphere of influence, and there will be trade within those bubbles. But the trade between the bubbles is gonna be very, very sketchy, uh, difficult to regulate, difficult to protect, and by definition can't really be very long-distance.

   3. CWChris Williamson27:18

      What's-

   4. PZPeter Zeihan27:19

      That eliminates a lot of what's out there.

   5. CWChris Williamson27:21

      ... what are you protecting the seas from? Is this criminals and people that are going to steal ships? Is, is that the risk that happens? I'm trying to work out the difference between the current state and a state where there are a few destroyers patrolling the seas.

   6. PZPeter Zeihan27:37

      Well, pre-World War II was usually imperial competition. Uh, if you didn't have something that you thought you needed, you went out and you took it, and if somebody else had it, you had a nice little war with a naval component. Uh, during the Cold War, it has been... I'm sorry, just during the post-Cold War era, piracy has come back in a very big way. Uh, it's more an irritant, but if you look back to pre-World War II, privateering was all kinds of fun. And the idea that you didn't have to go out and raid your opponent's shipping yourself, you could just hire someone to do it, I expect to see a lot more of that.

   7. CWChris Williamson28:10

      Oh, so that was what I was thinking. I was thinking this sounds very primitive, very medieval that countries that publicly are at peace and have their diplomats going to visit each other and conversations and they're sat around tables together ab- agreeing about stuff, that they would try and steal shipments of potatoes or whatever it is that's going on, or metals. That seemed a little bit unlikely. But what you're saying is that there are ways around committing outright acts of naval war by-

   8. PZPeter Zeihan28:44

      Right. I mean, you can have state piracy, basically using your military to grab things direct. You can have privateering, where you rely on third parties to do it and provide safe harbor. Uh, and then you can have flat-out piracy. Uh, we've dealt with all of them in the past. We're gonna have to deal with all of them in the future.

   9. CWChris Williamson29:00

      Do you think-

   10. PZPeter Zeihan29:01

       And-

   11. CWChris Williamson29:01

       ... that's rea- is that realistic, though? In the current state where information is able to be pushed around the world super quickly and s- sanctions and public lambasting and so on and so forth, would someone really come out and try and steal some ships, whether under the cover of, uh, a bunch of guys that-

   12. PZPeter Zeihan29:20

       I mean, Russia's been doing it for six months.

   13. CWChris Williamson29:25

       Okay. Yeah. Yeah.

   14. PZPeter Zeihan29:28

       (laughs) Yeah, it's like when you, when you-

   15. CWChris Williamson29:28

       They're, they are at war, though, right?

   16. PZPeter Zeihan29:29

       ... when you break down the rules of action and when you remove the security guarantor, countries do what they feel they need to, whether it's out of opportunity or desperation.

   17. CWChris Williamson29:38

       Interesting. Okay. So that's globalization. Globalization, let's say that it, it does, uh, start to slow down.

6. 29:45 – 44:31

   Effects of Declining Globalisation

   1. CWChris Williamson29:45

      What are the knock-on effects of that?

   2. PZPeter Zeihan29:47

      Oh, dear God. Okay (laughs) . Uh, so I just wrote this book (laughs) . Uh, the book's split into six big chapters based on the various economic sectors, so transport, finance, energy, industrial commodities, agriculture, manufacturing. Uh, everything that we understand, uh, about all six is dependent upon the idea of global security. And so you remove the global s- security and all six of them have to unwind and reform in different ways. So really, it's kind of pick your poison. With transport, long haul goes out the window.That's an end to, among other things, supertankers. So if you were getting your oil from 3,000 or more miles away, (inhales sharply) you're outta luck. Um, ships are going to have to be smaller and go faster because the concentrated risk that a giant container vessel has, you lose one of those and the shipping company goes away. If you're doing smaller tankers or smaller ships that are going faster, they can't carry as much, you just lost most intermediate goods trade. That's an end to electronics manufacturing in its current form. So you can play this on really any topic that you want, but the structures that have all held it together and made it work are dependent upon the ceiling not falling. And it's falling.

   3. CWChris Williamson31:06

      It seems to me like the current way that the world's set up has got most people, myself included, to believe that everyone's just a bit nicer now-

   4. PZPeter Zeihan31:15

      (inhales deeply) (laughs)

   5. CWChris Williamson31:16

      ... than we were for most of human history. Do you, do you understand what I mean? That it's-

   6. PZPeter Zeihan31:20

      I totally do.

   7. CWChris Williamson31:21

      ... it's, uh, how would you say? It's global policing masquerading as virtuous human nature.

   8. PZPeter Zeihan31:28

      (inhales deeply) We established penalties for people who didn't play. And because the Americans started with Europe, which was the headquarters of most of the empires, it stuck. Uh, the only non-European empire that mattered at the time was the Soviet Union, which was the target of all this, and Japan, which was subjugated. So everyone who in the past had been a, a bad actor, if you wanna use that very loaded term, all of a sudden was on the same side. Everyone who had ever had a projection-based military throughout human history was in the same coalition. It worked for a while.

   9. CWChris Williamson32:08

      You've said that energy is one of the sub-components of globalization, presumably because in order to get the energy, you need to move it around the world in order to-

   10. PZPeter Zeihan32:15

       Sure.

   11. CWChris Williamson32:15

       ... take it from where it's taken from to where it needs to be used. Is, uh, just how crucial of a port, uh, uh, point is energy 'cause Alex Epstein's been on the show, Nate Hagen's been on the show, Richard Bettts from the IPCC's been on the show. I understand that they have their priors with regards to where their research lies. But obviously, their focus is that, especially with Nate, you know, energy is, is absolutely everything. What are your views on the current sort of state of the energy climate and then moving forward, climate change as well?

   12. PZPeter Zeihan32:44

       I would say that there's not a lot of light between me and those names. I mean, obviously, when you get into details, analysts can quibble about everything. Uh, they, and th- they can, they do, absolutely. Uh, but the o- the core idea that without energy none of this works is solid. Um, we've spent the last 70 years bringing the energy from where it's produced to where it's consumed, which means primarily from the Middle East to Europe and East Asia. North America is more or less a self-contained component, even was before the shale revolution. Now, it certainly is. Um, that was one of the prices the Americans paid in order to get their alliance, is making sure the energy would flow. In the environment we're in now, we're at a risk of losing all Russian crude. Now, I've always thought this was, was going to happen eventually. I didn't think it was gonna happen this soon. Uh, Russian crude is what has largely fueled the global economic expansion since '92. 'Cause when the Soviet system collapsed, their energy production did not, and all of their commodities were just dumped on the international market. And that has kept prices relatively low for 35 years. That period is now closing. And so we're gonna lose 5% of global crude, which doesn't sound like a big deal until you remember that energy demand is inelastic, and a 5% loss in crude can easily generate a tripling in price. So an energy-induced depression that is broadly global in scope will start because of the Ukraine war at some point, and this is probably the reason that no one's gone after that raft yet, because that would be the death blow for the Russian energy sector.

   13. CWChris Williamson34:26

       So that would kind of be like, have you seen, uh, um, Margin Call, the movie?

   14. PZPeter Zeihan34:33

       Not recently, no. (laughs)

   15. CWChris Williamson34:35

       But do you, do you remember what it was about? It was the 2008 financial crisis-

   16. PZPeter Zeihan34:38

       Mm-hmm.

   17. CWChris Williamson34:38

       ... and it's, it's semi-fictional, and they bring everybody in overnight, and they say, "Look, if you decide to do this, if you decide to dump all of everything into the market, you are choosing to begin the most Armageddon-like financial situation that anyone's ever seen." So that, that's interesting, um, that for somebody to go and do that, they're aware that downstream five degrees of separation, there are a bunch of externalities that are basically going to ruin everyone.

   18. PZPeter Zeihan35:04

       Crash the whole system, yeah. Now, the math is gonna be different for everybody. Like, take, take Latvia. Latvia has the capacity to do this. All they have to do is grab one shuttle tanker as it's leaving Saint Petersburg. That would do it. And the Latvians have already managed to wean themself off of Russian crude. And while it would crush most of their European partners, they would see the destruction of the primary income stream for Russia as an un-alloyed good. Or consider the Americans. We're self-sufficient. We have the capacity of putting a wall around our energy exports, so they stay at home. So we could actually see energy prices in the US go down because of this. But then the rest of the world would lose access to Russian and American crude at the same time. So everyone has their own math to run, and a lot of it is gonna depend upon how everyone interprets the loyalty or the actions of their allies. So I mean, look at Germany. The Russians are in the process of jerking with the Germans on natural gas. And, you know, for those of us and the rest of the world, like, "Yeah, natural gas, it's an energy source, whatever, no biggie," that's not what it is in Germany. The entire German economy is based on taking r- cheap Russian gas, processing it to petrochemicals, and then using those inputs in their entire manufacturing sector. If they lose that gas, it's not just that electricity prices go off. It's that the German manufacturing model fails.So, the Germans are being presented with a choice, leave the coalition and keep the lights on, or lose your gas and no longer be modern. So, what's more important to the Germans, being Western or being modern? That's a, that's a shit choice. But it has consequences and people will judge them down based on what they do.

   19. CWChris Williamson36:50

       Peter, you need to give me something positive here, man. I'm just, I'm terrified.

   20. PZPeter Zeihan36:53

       (laughs)

   21. CWChris Williamson36:54

       This, this doesn't sound like a very good situation at all. What, what, are there bright lights? What are some of the bright lights?

   22. PZPeter Zeihan37:01

       There are countries that were damaged by globalization, uh, the empire specifically. If you were a country that had a pretty good geography at the start of this, then when the Americans came through and changed the rules so that everyone can play, you saw a massive drop in your overall power. Um, if you are one of those countries and you have a positive demographic structure, you could actually make a lot of hay out of what's coming because you could, I don't want to use the word imperial, neo-imperial might be the right word, uh, you can definitely make a bid for your own neighborhood. So, uh, the two countries that are on the top of my list as regards that are Turkey and France. Decent demographics, good manufacturing base, largely not integrated into their neighborhoods economically. Uh, the French actually trade less with the EU than the Brits do. Uh, fun fact. Um, and I can see part of Western Europe becoming part of a French fiefdom, and obviously parts of the Middle East, uh, for Turkey. I would have put Japan on that list, uh, but the Japanese managed to cut a deal with both Donald Trump and Joe Biden, which makes the Japanese the only people who have been able to get on with both sides of the American spectrum of late. So, I think they've basically agreed to partner up with the US rather than go their own way, which I think will be the best for everyone in the long term, unless you're Chinese, of course.

   23. CWChris Williamson38:19

       How's the UK gonna do?

   24. PZPeter Zeihan38:21

       That's up to you. Uh, you really need to figure out this Brexit thing. I mean, it's just, yes, you've left, but you still don't have any plan for what's next, and that is really hurting you. Uh, with every day that that is pushed off, your negotiating power with whatever the structures of the future end up looking like are gonna be weaker and weaker, and you're very rapidly getting to the point where the only option you're going to have is a trade deal with the United States on America's terms. There are worse things that could happen, but, uh, we will be as, um... It's the best way to phrase this. We will be as gentle in the negotiations as we were during the Lend-Lease Talks, where you basically had to give up half of a hemisphere of military presence in exchange for 40 destroyers that you used to laugh at because they were so bad.

   25. CWChris Williamson39:11

       Not good, it doesn't seem.

   26. PZPeter Zeihan39:13

       No. No, it's not a good negotiating position, that's for sure.

   27. CWChris Williamson39:15

       Okay. You think that Mexico is going to be a big part of America's future. Also, Canada's good because it's able to-

   28. PZPeter Zeihan39:21

       It probably is.

   29. CWChris Williamson39:21

       Yeah, uh, because it's able to do good immigration, it's able to keep its demographics pretty well. What's the future for America look like in your opinion?

   30. PZPeter Zeihan39:28

       Well, the United States is starting this p- process with very little trade exposure to the wider world outside of manufacturing in Asia, uh, a net energy exporter of all forms. A, the largest refining power in the world, the largest agricultural power in the world. So, a lot of the things that every single country in the world is just gonna have to stress about, us, it's just kind of a no-brainer. It's already there. Uh, in addition, successful manufacturing requires proximate labor that is at different skill sets and price points. So, the person who's doing the injection molding is not the pe- the same guy who's making the microchip. With Mexico, we've got that already. So, uh, for us, a lot of the hard work has already been done, and while I'm not a huge fan of Donald Trump by any measure, his renegotiation of NAFTA was a stroke of genius, and it got ahead of a lot of these issues. Um, because of that, North America as a unit looks pretty strong, and we're already seeing established linkages to other powers that might be useful. So, we, for example, already have free trade deals with Colombia and Chile, which are, in my opinion, the two most dynamic South American economies. Uh, we already have a long-term agreement with both the Koreans and the Japanese. Uh, the Australians have a free trade deal with the United States, and we're in league with the Australians and the Japanese really starting to become engaged with Southeast Asia, which is another part of the world where the demographics and the geography line up. So, that kind of greater American co-prosperity sphere is about as good as it's going to get. I mean, you'll have to deal with the Americans. We tend to be a little twitchy sometimes, uh, but we're twitchy in a different hemisphere for most of the partners, which most people really like. Uh, in your neck of the woods, France is just gonna be completely insufferable, uh, because they're gonna become the broker for the Germans. They're gonna become the, the first power in Iberia and in Italy, and they're probably gonna make a bid for the low countries, too. And the longer it takes the UK to become a self-sustaining power again, the more advantage the French are gonna have in rewriting the local rules. So, a good example is that, you know, you've, you've built these two super carriers. They're, they're top-notch pieces of equipment, but between budget cuts and austerity and the financial crisis, you let the rest of your navy die. So, you've got these two fantastic vessels with no defensive rings, which means the only way that you would ever let them leave port is if they're sailing as part of an American battle group. Again, not a good negotiating position.
7. 44:31 – 51:29

   Future of the Global Population

   1. PZPeter Zeihan44:31

   2. CWChris Williamson44:31

      I was with Jonathan Haidt a few months ago at the Heterodox Academy Conference, and he was talking about the dangers in the dating market for Gen Z at the moment, the high levels of social anxiety, the fact that you've got one-third of people aged 18 to 35 are still living at home with their parents, the number of 18 to 30-year-olds reporting no sex has tripled in the last 10 years from about 10% to 30%. A bunch of things that are causing young people to be less socially out there, presumably to have children later. I think it's 2019 that for the first time ever, more women had children over the age of 40 than under the age of 20. For the first time ever in history, more women at the age of 30 were childless rather than with child. So all of these things seem like they would predict a ever-aging gen- generation or an ever-aging, uh, demographic. What your suggestion is that you have this sort of hourglass shape, and there will be some sort of inflection point presumably with the 15-year capital boom that would-

   3. PZPeter Zeihan45:32

      Probably.

   4. CWChris Williamson45:33

      ... that would en- that should hopefully encourage more families, more children, more population offset this going from an hourglass into a, uh, inverted pyramid?

   5. PZPeter Zeihan45:43

      That's what the data we have today suggests, but I, I've gotta underline we're in uncharted territory here. The world has never had a population bust, uh, without having some sort of massive endemic disease or war event. Uh, so when I say, you know, the Chinese collapse has to happen, you know, I don't know how you make it work without kids or young adults. When I say that the Americans are gonna experience a, a bi- um, another baby boom as the Millennials really come into their own, history and data suggests that, but we've really never seen this combination of factors before. Um, the Zoomers, I have concerns. Uh, they are not like Millennials. Um, Millennials are very outgoing, they're very social because they were raised by the Baby Boomers and they were always told that they were special. That's one of the reasons why a third of them still live at home. The Zoomers were grazed by Gen X, my generation, and we took a very different view of things. You know, we kept track of the score at the soccer game. We wrote it down. We showed it to them before each game. We read it to them to bed so that they wouldn't forget. And when they turn 18, they're the hell out of the house. Uh, they're, they're insular, they're competitive. They don't like relying on anyone for anything. And so the whole group dynamics and managerial dynamics that the Millennials are positively known for and recognized for, uh, they're the antithesis. Their dream job is to code alone in the dark in a closet, and that makes it hard to have kids. So, I think we can guarantee that when it's the Zoomers' time, when they're in their 30s, that their birthrates are gonna be low. Their marriage rates are probably gonna be the worst we've ever had. Their suicide rates are already the worst we've ever had, which (sighs) just means that the Millennials will save us all (laughs) .

   6. CWChris Williamson47:31

      Okay. Right. You're relying on, you're relying on me and my lot.

   7. PZPeter Zeihan47:34

      Yeah.

   8. CWChris Williamson47:35

      Fantastic. Given-

   9. PZPeter Zeihan47:36

      (laughs)

   10. CWChris Williamson47:37

       Given the current state, and obviously there's lots of, uh, contributing different countries, what's going on with demographics, people talk about a population collapse overall globally. What is your view of global population?

   11. PZPeter Zeihan47:49

       Uh, before we start talking about deglobalization, so assuming that globalization continues from its height onward, we were already in the process of revising down our estimates. So it used to be 15 years ago that we thought by 2050, we were gonna have 11 to 12 billion people. That number is now under 10. And as the data continues to get upgraded, we'll probably, assuming nothing goes wrong, peak at just below nine and then start falling back gently. If I'm right about deglobalization, we're gonna have a significantly sharper drop-off, and as soon as globalization hits agriculture at large which may be in the fourth quarter of this year, population peaks.

   12. CWChris Williamson48:34

       Wow. Okay. Positive stuff. Uh-

   13. PZPeter Zeihan48:37

       (laughs)

   14. CWChris Williamson48:39

       ... (laughs) looking at the ways in which population collapse and the reduction of that could be tied in with automation, is there any technological savior that can come through and assist us with the problems that we're facing at the moment? There's always unknown unknowns when it comes to technology-

   15. PZPeter Zeihan48:56

       Of course.

   16. CWChris Williamson48:56

       ... I'm aware of that. But, eh, eh, are there things that you can foresee if we get particular advancements that may alleviate some of this?

   17. PZPeter Zeihan49:04

       Absolutely. So pros and cons. Uh, there are a lot of technologies with a- automation, AI, and robotics that look really good. Now, AI, the whole idea of general AI and Skynet, we're decades away from that. So I almost put that in a box. I'll let Ian Musk talk about that. Uh, AI is all about image recognition today and getting it so that machines can recognize different things and then do pre-programmed tasks. There's no aut- there's no real autonomy, but it's automated. Uh, that allows manufacturing to reshape, but it also requires massive economies of scale. The most expensive thing a country can do isn't industrialize, it's to automate. And it's not a one-off cost. You have to constantly update it 'cause every time there's a change to the production line, you more or less have to start over with the programming. So it's a very expensive way to go. It does use different labor and less labor, but it's not clear to me that it really moves the needle in a huge way. And if we're breaking down global transport and intermed- mediate goods trade, then we're losing the economies of scale that make that model work. In North America, where you've got one-third of global consumption, we'll probably still be doing that, but I see that broadly leaving the East Asian sphere, uh, which combined with their bad demographics are awful. We also have the Baby Boomers leaving so that we know that the capital crunch is coming. That means less money is available to do this sort of upgrading. Uh, the, the technology that I'm most interested in are the combination of automation and agriculture. We're very close to having facilities that you can latch onto a tractor that identify each individual plant and identify if it needs water or fertilizer or pesticide or if it's a weed or whatever. And then, it gets a squirt of whatever is appropriate. So you do, like, six passes of stuff in one pass, and each plant gets individual attention. That suggests that we would be able to reduce fertilizer and pesticide use by 80% and maybe even double yields. But again, economies of scale. It only works on mega-farms where you can afford the equipment cost. So if you've got giant farms in the United States or the Netherlands or Argentina or Australia, sure. Doesn't work for most of the world.

   18. CWChris Williamson51:28

       Talking about

8. 51:29 – 58:45

   Will China Still Be a Manufacturing Giant?

   1. CWChris Williamson51:29

      technology, I've heard that we are unbelievably reliant on getting cheap technological parts out of China, silicon chips and other such stuff. How much of an issue is it going to be if China is facing demographic collapse and then can't make anything anymore? How much is that going to have downstream effects for the rest of the world's technology?

   2. PZPeter Zeihan51:48

      Well, we've been a little bit lucky that the Chinese have kind of become a bag of dicks and really encouraged everyone to outsource and resource everything that they can. Uh, it's, that's bought us a lot of time. Now, in the United States, everyone is paranoid about semiconductors, and we all see that 12% number that the US now only produces 12% of global chips as a, as a panic point, but that's by number. By value, we produce 60%. So all the good-

   3. CWChris Williamson52:16

      What's the difference?

   4. PZPeter Zeihan52:16

      ... chips are designed in Japan and the United States. They might be manufactured somewhere else if they're further down the, the scale. Uh, but in terms of cell phones and server farms, the, the important stuff, that, that's already safe. Uh, the problem is gonna be the mid and the lower land. The mid ones are usually Malaysia and Thailand. The lower ones are almost certainly China. So when you're talking about the lower tech stuff, the Internet of Things, yeah, that's just going away. But I'd argue that I don't really need a meat thermometer that is gonna tell my phone what the temperature of the meat is. I mean, we can get by without that, I think. It's overall electronics manufacturer that's gonna be the big issue 'cause remember, differentiated labor forces is what makes manufacturing work. China's a huge place. It's got a lot of that internally, and then it has access immediately to Taiwan, Japan, Korea, and Southeast Asia. That's what's breaking down that whole ecosystem. Uh, we can't rebuild all of that. I mean, just, just to serve electronics needs for North America probably would require a workforce of four million people in manufacturing. We're already in labor shortage, and the Mexicans are kinda tapped out already. So there is gonna be a huge amount of pressure. Americans do well at the really high-end manufacturing and the very low end because we're energy rich. It's the part in the middle that we're really reliant on the Mexicans to save us for.

   5. CWChris Williamson53:44

      What ways could you be wrong about all of this stuff?

   6. PZPeter Zeihan53:46

      You know, like I said, this is perspective. We're dealing with an environment that we've never been in before. Uh, the way I would like to be wrong is that the Americans would actually do what George Herbert Walker Bush wanted to do back in 1991 and have a conversation with ourselves about what sort of world we wanted to live in and how to get there. We weren't interested then. I would argue that we're really not interested now. Uh, so the, the risk here, from my point of view, is that globalization does manage to persist because of some lingering American commitment. I'm not seeing that. I'm certainly not seeing that with Ukraine war. Yes, we're seeing NATO having a, a new lease on life, but the whole guns for butter deal that we made during the Cold War, none of the economic stuff is on the agenda. All the sanctions that the Trump administration enacted are still there with one exception at the Airbus case. Uh-... I don't see this very likely. And then on the demographic front, that's just math. If you want more 30 years- 30-year-olds, you had to start 31 years ago. (laughs)

   7. CWChris Williamson54:49

      What difference would it make if China invaded Taiwan?

   8. PZPeter Zeihan54:52

      (inhales deeply) Uh, that would probably lead to the end of the Chinese system as an industrialized economy in less than a year. Um-

   9. CWChris Williamson54:59

      Why? That's fascinating.

   10. PZPeter Zeihan55:01

       It's an open question of whether or not the Chinese could pull it off, uh, and with the Ukraine war, we finally got some good signposts of what it might look like. The Chinese have always assumed that the war would be a walkover, that no one else will get involved, and that China is such a big place that everyone will just suck it up and move on. Well, that clearly hasn't happened with Ukraine, and the United States and the West have a much tighter relationship with Taiwan than they do with Ukraine. Ukraine was only preparing for this war for eight years. Taiwan has been preparing for 60. Uh, Ukraine can, you can walk to Ukraine from Russia. It's a bit of a swim to get to Taiwan. Uh, the sanctions that are in place against Russia would absolutely devastate China 'cause while Russia has a lot of faults, it's a major exporter of food and energy. China imports those things. 75% of their oil is imported from a different continent, uh, and 75% of their oil is imported. And then I think it's really the boycotts that have really scared the Chinese the most. The idea that individual citizens might have any say on policy, they had n- they did not see that coming. They have no way to process that in a one-man state. If you would have taken-

   11. CWChris Williamson56:13

       Because it's so different to the setup that they have, yeah.

   12. PZPeter Zeihan56:16

       Yeah. Exactly. So, every assumption that they've based the last 40 years of military planning on has proven to be wrong. And then, of course, there's the question of whether they could actually do it. If they did a slow-motion mobilization like the Russians did, took three months, the Taiwanese would see that. They'd build a few nukes, and so the cost of c- capturing Taiwan would be losing Shanghai and Beijing. That doesn't seem like a good plan. So, the only battle plan that I've seen that might work is if they just text every member of the army and say, "Go to a port, get on a fishing boat, and sail." You'd lose a million people in the crossing just to get to the beaches. So, there, there's nothing about this that works, and if they did pull it off, even if they do capture Taiwan, they are now cut off from global manufacturing, global investment, global energy, and global food. Trucks stop running within a couple of months, the lights go out in less than six, and that is all she wrote. Remember, agriculture is an industrial sector. So, you're talking about mass famine in under a year.

   13. CWChris Williamson57:19

       Dude. That is wild. (laughs)

   14. PZPeter Zeihan57:21

       Now, normally, I'd say the Chinese aren't stupid, they wouldn't do this, but it's a one-man show now, and nobody wants to bring Xi any information 'cause they don't know how he'll react. He's shot the messenger literally so many times-

   15. CWChris Williamson57:33

       Mm.

   16. PZPeter Zeihan57:33

       ... that everything is a surprise to him.

   17. CWChris Williamson57:36

       Yes, I understand what you mean. I suppose there's a lot of criticisms around the fact that the vote of a stupid person is worth as much as the vote of a well-educated person in a democracy. But the problem is if you condense all of that power down to a single individual, the decision of, uh, an angry or grumpy individual is the same as them on a good day or them if they were less idiotic or somebody else had got to power. So, yeah, I suppose, uh, it's a, like a forcing function that condenses all of these things down to one individual human that is just as fallible as the rest of 'em, maybe even more fallible.

   18. PZPeter Zeihan58:10

       And if that one human is perfect every time, okay. (laughs) But even a minor mistake just cascades through the system, and it's a full cult of personality. So, you know, we've got basically people who are zealously trying to do what they think Xi wants them to do, and just one of the more inane ones is seeing teams of people in hazmat gear disinfecting airport runways because they think that's what you have to do for COVID. Just that y- y- people talk about the Americans now in a fact-free zone. That's nothing compared to what's going on in the Chinese system.

   19. CWChris Williamson58:42

       (laughs) Okay, so what do you think, uh, for

9. 58:45 – 1:01:52

   Quality of Life in the Next Decade

   1. CWChris Williamson58:45

      most of the people that are listening to this, UK, US, some in Australia, what is life going to be like? What is the quality of life going to be like over the next 10 to 20 years? What can people expect?

   2. PZPeter Zeihan58:55

      Well, the next five years are going to be rough. We basically, in the West, need to at least double the size of our industrial plant. Um, let me correct that. In the West, minus Germany. Germany's its own special case. Uh, everyone else has largely hollowed out their manufacturing as part of globalization. We focus on the really high-end stuff and the design, but a lot of the middle and the lower stuff is now done in other countries. That's gotta change. Uh, if you are part of a network where you can access lower-skilled labor like the Americans are with the Mexicans, great. If you're not, you either need to attach yourself to another system or find some way to go without. Now, if you are in that kind of friends and family network of the Americans, energy is covered, food is covered, investment will be tight but available, and there's a degree of security that you won't have in the rest of the world. So, the biggest problem is gonna be building out that industrial plant. That means we should expect inflation in the US of maybe 9 to 15% for the next five or six years 'cause that's what it's gonna take to get through this. And if we do succeed at building that industrial plant over that timeframe, then that inflation rate will come down, and we'll have supply chains that are shorter, simpler, cheaper, and closer to the end consumer. So, better all around. So, if you're part of that network and you can get th- over that hump, it looks pretty good. If you decide to go your own way, things are gonna get a lot tougher unless you are one of those regional powers who actually has the geography and demography to make it work. France, after the financial collapse of, say, the euro, might not notice the rest of the world going to hell. Uh, their manufacturing is already in place. Their energy system is fine. They've got oil just across the Mediterranean. They're gonna have subsidiary economies in Spain and Italy. It's a fairly good setup.

   3. CWChris Williamson1:00:50

      That means that cost of living's going to increase. That means cost of energy's going to increase. Quality of life going to go down. I mean, are we going to see civil strife in your opinion? What's gonna go on?

   4. PZPeter Zeihan1:01:00

      I think we'll see a lot of governments collapse, but again, it depends upon where you are. Uh, the Americans will always complain more than what the problem is worth, uh, and the fact that we're going through our political transition at the same time we're doing this is, you know, awkward (laughs) to say the least. Uh, we're gonna blame a lot of things on a lot of things that have no direct connection. That's very American. Uh, if you're talking about Britain, that's up to you guys 'cause like, you know, if you can figure this out and figure out a relationship with the United States or the French before the break, that would be your best bet. Uh, but Britain's-

   5. CWChris Williamson1:01:34

      Is that because after the break, bargaining power goes through the floor?

   6. PZPeter Zeihan1:01:38

      Yeah. Exactly. Now is the time to cut a deal. You've just had a change in government. The Ukraine war is hot and heavy. If you are going to have a leader take the country in a more sustainable direction, now is the time.

   7. CWChris Williamson1:01:50

      If people want to keep up to date with

10. 1:01:52 – 1:02:31

    Where to Find Peter

    1. CWChris Williamson1:01:52

       the stuff that you're doing, with the work, with, uh, uh, keeping themselves abreast of all of everything that's happening at the moment, where should they go?

    2. PZPeter Zeihan1:02:01

       Uh, the website is Z-E-I-H-A-N.com, and if you go to that /newsletter, you can sign up for our video logs and newsletters. They're free. They will always be free.

    3. CWChris Williamson1:02:11

       Peter, I appreciate you. Thank you. (instrumental music plays) What's happening, people? Thank you very much for tuning in. If you enjoyed that episode, then press here for a selection of the best clips from the podcast over the last few weeks. And don't forget to subscribe. Peace.

Episode duration: 1:02:31