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This is a country that has a missile

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system that was designed to obliterate the United

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States.

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And while they have lost over and over

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and over and over and over about where

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the red line is.

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We only have to be wrong

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1

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for this to get out of control.

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Welcome to activation. I'm your host, Peter High.

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My guest is Peter Zion.

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Peter a geopolitical strategist to his expertise is

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at the intersection of demography,

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economics, energy, politics,

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technology and security. He founded his firm eye

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on geopolitics in 20 12 following a dozen

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years as a geopolitical analyst for Strat 4.

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Peter's written 4 books, including the accidental superpower,

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which has a new edition recently published providing

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updates to his analysis from across the 10

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years

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since the book's first publication. His fourth book

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is the end of the world is just

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the beginning, mapping the collapse of globalization, which

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was published in June of 20 22 and

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was a new Times best seller.

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Peter welcome back to. It's great to speak

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with you today. To be back. Wonderful. I

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thought we'd begin

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Peter with some really interesting insights you have

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about why you believe that Stalin was the

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most important or influential person in the past

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of, 500 years.

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Explain how he set the table for the

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world world order for most of the past

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century.

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It wasn't so much for what he did

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or where he lived, but because of who

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he terrified,

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Americans realized in the late 19 forties that

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we were

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on the tail end of World War 2,

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all of a sudden gearing up for another

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war with a much more powerful enemy on

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the planes of europe, and we knew that

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it wasn't a war that we could not

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win.

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So we knew we needed tens of millions

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of people to stand not with us, but

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in front of us.

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And convincing the Europeans to sign up to

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be cannon fodder right after World war 2

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as kind of a high bar. So we

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knew we needed some way to induce them

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to take that role, and our solution was

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globalization. We sent out our navy to patrol

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the global ocean so that any maritime shipping

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can go anywhere without an s court that

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never happened before in human history.

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And the result was the prayed order that

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we now have today.

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None of that would have happened if we

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weren't scarce. By stalin.

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Well, you note in your most recent book,

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the seeds of d globalization were so decades

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ago,

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provide an overview if you would of why

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you happened and why it's been inevitable.

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Well, keep in mind, globalization was a reaction

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to an American

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security fear.

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So we never invested our economy in the

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system in the first place. So number 1,

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the security environment changed, even with the Russians

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back on the war path or a pale

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shadow of what they were during the cold

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war. So we no longer feel we need

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to have a global alliance. In addition, 75

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years later, there are a lot of secondary

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economies out there that have some he. So

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the idea that the United States, even in

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its current strength in terms of its consumer

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base and the size of its economy could

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directly subsidize all of that. That was never

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gonna fly.

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And politically, the Us has moved on. So

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we never invested our economy in the system.

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We don't have an inter international economy, but

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we provide the security for everyone else to

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have in the international economy, and that doesn't

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fly anymore. So we're just backing away from

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the system There's no country. There's no coalition

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of countries that can take our place either

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as the market of first and last resort

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or as the global security gu. So that

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ends it right there.

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Second and just as importantly is after 75

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years of

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globalization, we have had 75 years of

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globalization 75 years of

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urbanization. And when you move from the farm

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into the city, kids are no longer free

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labor, they're an expense and adults aren't stupid.

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So we had fewer of them. Do you

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fast forward that from 19 50 to today,

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we've seen global birth rates drop by more

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than 3 quarters.

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And in an increasing

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percentage of the world's populations, there are no

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longer enough people under age 45 to assume

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in volume.

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China's is on that list now. And so

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there isn't a population structure to support global

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trade in me more anyway. So whether you

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look at it from the guns or the

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butter point of view, this chapter of history

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is very rapidly coming to a close.

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Fascinating analysis, you note that

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demographic conversion is going to lead to economic

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free fall across many industrialized countries and you

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point out they're they're simply aren't enough. You

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own people across the industrial as world as

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you noted, given the fall and birth rates.

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You've also noted that many of these countries

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past the point of over turn, so to

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say, in the 19 eighties,

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and you... You've also noted that the worst

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stop of all is China, you just alluded

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to that. In your latest book, you noted

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in I quote here, China faces a d

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industrialization that is nothing less than mythic. It

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almost certainly

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faces a political dis integration. And even des

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civilization, Can you describe what that entails and

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why that's the case? When an economic model

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breaks the political

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always breaks. There has not been an exception

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to that throughout human history, and the Chinese

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system is based on mass import of raw

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commodities most notably energy and stuff they need

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to grow their own food and a mass

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export of finished goods to end markets that

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have consumers.

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Well, there... The consumer market is now danger

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in shrinking and trade tensions are destroying the

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front end of that as well. And that's

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before you could start talking about Americans new

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obsession with things like semiconductors

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or rare earth metals.

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There's

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very little that the Chinese can do to

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influence events in these topics on their shores,

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much less dictate American policy.

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So it was always an issue where

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the single greatest gu tour of Chinese economic

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success was the United States Navy and that

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was never a very good long term bet

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in the first place.

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Since the book has come out, This situation

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in China has gotten so

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much

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worse.

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We now have

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the public system in China admitting that they've

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encountered their population by more than a hundred

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million people. We now have official statistics suggesting

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that their birth rate has dropped by more

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in the last 6 years and what happened

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to the Jews Europe during the holocaust.

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And now we have private economists,

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private

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saying that the over count on the population

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is probably closer to 250000000.

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All of the missing millions under age 40.

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So not only is consumption led growth now

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impossible in the people's republic. They have age

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passed even the theoretical

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stage where you could press gang women into

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rape camps to generate a higher birth rate,

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which is something that every once in a

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while I want I'm in Asia, people suggest

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something that might happen, which

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I might not have a high respect for

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the humane levels of the Cp, but I

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have never thought they wouldn't go that far.

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But down not even that is an option.

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I mean, unless we have, like, a sudden

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breakthrough in Star Wars style cl

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where you can grow a bunch of 20

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something's

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with full skill sets in under 2 years,

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this ends

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within 10 years. And by this, I mean

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the Chinese system itself.

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This is a system that can't feed itself.

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Can't fuel itself, and it no longer has

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enough people to try to go back to

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a subs

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agricultural system.

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We are looking at a breaking of what

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it means to have a hana ethnicity in

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just the next few decades.

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And what does that entail in in practice?

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Gonna... What what will China? Obviously, people will

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still be there? The land will still be

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there

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what what then range? Chaos

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you know, who who leads that? How what

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what sort of how does it function or

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or how how does it not, according to

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to Well, let's try. Start by saying that

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this is all guess work because this has

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never happened before civilization history. The closest,

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perhaps parallel we have, and it's not a

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great 1. Is the population collapse we saw

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in the late Roman period when a combination

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of sla and disease gutted a lot of

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the provinces,

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And, yes, you see a breakdown in civil

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control to the degree that you basically had

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a d population through lack of security, lack

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of disease, lack of health care. Lack of

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economic activity and entire area basically resort the

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barb.

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In this specific case, in China,

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China's history is actually rep repeat with civilization

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collapses in in the past. If my math

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is right, This is gonna be the 20

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seventh

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civilization collapse. Where the central government has simply

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collapsed,

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huge swath of territory that we think today

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of being economically vital, basically revert to the

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the term marches

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where basically you've got pockets of

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civilization that can kinda hold back the night

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and then big swath of territory where no

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1 holds sway.

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In Chinese Par,

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it's warlord is.

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The problem, of course, in a place like

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China is most the people live in an

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area where you can't grow food

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unless you also have a significant water works

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system.

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So if you break down

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civilization

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pillars

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and central control, the ability to maintain those

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networks goes by also the Chinese import 80

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percent of the inputs they need to grow

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their own food. So on top of all

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of this, having a a mass famine large

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sections of the population,

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especially in the North China plane where the

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inputs are the highest and the demands

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for a water work system are the highest.

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Historically speaking.

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Of those 27 collapses, about half of them

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have kind of followed some version of of

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the same pattern

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where the north

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North China plane has famine

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has warlord ism has an attempt by Beijing

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to basically invade ne depress itself to stability,

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which typically kills half the population.

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And then you have the southern city states

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from Shanghai Guangzhou Joe that go their own

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way.

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And basically, cut deals with foreign powers to

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import capital technology and above all else food.

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In order to continue existing. Most of these

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cities have imported the majority of their calories

274
00:09:51,017 --> 00:09:52,209
for the last 1700 years.

275
00:09:53,004 --> 00:09:55,229
And the modern era that we're in where

276
00:09:55,229 --> 00:09:57,500
all of Mainland China under a single political

277
00:09:57,720 --> 00:09:58,200
authority,

278
00:09:58,679 --> 00:10:01,419
and Guangzhou gets its food from the planes

279
00:10:01,720 --> 00:10:04,853
around Beijing. That's not normal for them. So

280
00:10:04,853 --> 00:10:07,645
this is gonna sound horrible, but we're actually

281
00:10:07,645 --> 00:10:10,697
reverting to something closer to the historical mean

282
00:10:10,756 --> 00:10:10,995
here,

283
00:10:12,112 --> 00:10:13,866
and the historical mean is not pretty.

284
00:10:14,757 --> 00:10:15,947
Very interesting analysis.

285
00:10:16,502 --> 00:10:18,565
You know, part of the demographic challenges you

286
00:10:18,565 --> 00:10:20,548
described or part of the industrialization that most

287
00:10:20,548 --> 00:10:21,913
countries have gone through, but part of it

288
00:10:21,913 --> 00:10:24,067
also self inflicted of course with the 1

289
00:10:24,067 --> 00:10:26,619
child policy on top of that. All that

290
00:10:26,619 --> 00:10:29,012
you described, I would imagine would not be

291
00:10:29,012 --> 00:10:31,245
news necessarily to to president Xi.

292
00:10:33,251 --> 00:10:34,366
And what you said it in many ways,

293
00:10:34,525 --> 00:10:36,993
his actions are actually listening the country's demise.

294
00:10:37,391 --> 00:10:39,063
And I wonder how much of that is

295
00:10:39,874 --> 00:10:41,412
to the unintended consequences,

296
00:10:41,949 --> 00:10:43,785
you know, do you see him attempting to

297
00:10:43,785 --> 00:10:46,020
to to put to action something that would

298
00:10:46,020 --> 00:10:47,616
at least stave off the inevitable?

299
00:10:48,509 --> 00:10:51,302
I think the government system at the top

300
00:10:51,302 --> 00:10:53,696
is to degrade the point that useful policy

301
00:10:53,696 --> 00:10:55,212
if it happens is more like monkeys on

302
00:10:55,212 --> 00:10:55,690
a keyboard.

303
00:10:56,263 --> 00:10:57,691
Don't mean that as a racial slur. I

304
00:10:57,691 --> 00:10:59,674
just mean that she has so purge the

305
00:10:59,674 --> 00:11:02,529
system of anyone who is competent that no

306
00:11:02,529 --> 00:11:04,927
1 even brings some information anymore. So he's

307
00:11:04,927 --> 00:11:07,399
making decisions in a complete vacuum guided by

308
00:11:07,399 --> 00:11:09,653
nothing more than propaganda. Now we we know

309
00:11:10,030 --> 00:11:11,567
5 years ago

310
00:11:11,944 --> 00:11:13,952
before the purge of the bureaucracy he was

311
00:11:13,952 --> 00:11:17,164
complete. But he was fully aware of the

312
00:11:17,222 --> 00:11:19,375
limitations that China faced at home and abroad.

313
00:11:19,773 --> 00:11:21,687
He knew he was dependent on the Us

314
00:11:21,687 --> 00:11:23,059
market. He knew he was dependent on the

315
00:11:23,299 --> 00:11:25,299
Us Navy. He knew he was dependent on

316
00:11:25,299 --> 00:11:26,659
international trade to keep the lights on.

317
00:11:27,699 --> 00:11:29,299
He was aware of all of this and

318
00:11:29,299 --> 00:11:32,190
more. But with the purge of bureaucracy, no

319
00:11:32,190 --> 00:11:34,764
1 is any longer presenting him with basic

320
00:11:35,061 --> 00:11:36,997
information about what's going on at home or

321
00:11:37,055 --> 00:11:39,927
abroad. And whenever something does penetrate this kind

322
00:11:39,927 --> 00:11:42,089
of her meta seal he's got around himself

323
00:11:42,089 --> 00:11:43,915
in the forbidden city. Everything's news.

324
00:11:45,503 --> 00:11:46,003
And

325
00:11:46,694 --> 00:11:47,568
1 person,

326
00:11:48,203 --> 00:11:49,973
no matter how competent

327
00:11:51,000 --> 00:11:54,130
can't micro manage a country of a billion

328
00:11:54,347 --> 00:11:54,666
people,

329
00:11:55,303 --> 00:11:58,251
and he's destroyed all the avenues of communication

330
00:11:58,251 --> 00:11:59,606
and information flow.

331
00:12:00,178 --> 00:12:03,064
So as a result, the government, the bureaucracy

332
00:12:03,280 --> 00:12:05,110
is either making things up as they go

333
00:12:05,110 --> 00:12:06,803
or more likely doing nothing

334
00:12:07,194 --> 00:12:08,471
because they don't wanna be called to the

335
00:12:08,471 --> 00:12:10,945
account for something they weren't specifically approved for

336
00:12:10,945 --> 00:12:13,499
because that gets you killed. I don't see

337
00:12:13,499 --> 00:12:14,935
them recovering from this.

338
00:12:15,667 --> 00:12:17,656
The about the only scenario I can think

339
00:12:17,656 --> 00:12:18,451
of right now,

340
00:12:19,486 --> 00:12:21,792
where the Chinese might might might might be

341
00:12:21,792 --> 00:12:23,477
able to start down a path, that's a

342
00:12:23,477 --> 00:12:24,988
little bit more sustainable, at least buy them

343
00:12:24,988 --> 00:12:26,657
a little bit of time. Is if she

344
00:12:26,657 --> 00:12:28,962
were die to die by accident,

345
00:12:30,649 --> 00:12:33,769
And all of these nearly brain dead people

346
00:12:33,769 --> 00:12:35,450
that he's installed on the polar mirror not

347
00:12:35,450 --> 00:12:37,050
because they're confident not because the... They're yes,

348
00:12:37,129 --> 00:12:39,860
men. Because they're silence. If they were collectively

349
00:12:39,860 --> 00:12:42,655
to come to the realization that they need

350
00:12:42,655 --> 00:12:45,209
to go out and job hunt for people

351
00:12:45,209 --> 00:12:46,886
who actually can do math.

352
00:12:47,858 --> 00:12:49,290
And run a a small town.

353
00:12:51,597 --> 00:12:53,029
That's a lot of ifs to get to

354
00:12:53,029 --> 00:12:53,745
a possible then,

355
00:12:54,794 --> 00:12:56,390
You, the the... I I wanna talk about

356
00:12:56,390 --> 00:12:58,066
the broader implications of what you've described to

357
00:12:58,066 --> 00:13:00,060
the the the the rest of the world.

358
00:13:00,300 --> 00:13:01,975
China still produces as you noted,

359
00:13:03,345 --> 00:13:04,777
a lot of goods for the rest of

360
00:13:04,777 --> 00:13:06,767
the world is still being a manufacturing hub.

361
00:13:07,324 --> 00:13:09,474
And it's not as though the the the

362
00:13:09,474 --> 00:13:11,481
rest of the world, the Us very much

363
00:13:11,481 --> 00:13:12,597
included among that

364
00:13:13,076 --> 00:13:13,576
have

365
00:13:14,033 --> 00:13:15,867
alternatives in place that would be able to

366
00:13:15,867 --> 00:13:17,462
make up for this, Yeah. Especially if the

367
00:13:17,462 --> 00:13:19,616
demise comes quickly, you you predicted perhaps even

368
00:13:19,616 --> 00:13:20,747
in the next 10 years.

369
00:13:22,182 --> 00:13:23,617
You know, what what would you if you

370
00:13:23,617 --> 00:13:24,972
you were as as you do. In fact,

371
00:13:25,132 --> 00:13:26,886
it was in the ear of a policy

372
00:13:26,886 --> 00:13:28,241
makers in the United States,

373
00:13:29,527 --> 00:13:31,274
what's I'm not the whispering kind of guy,

374
00:13:31,432 --> 00:13:31,988
but thank you.

375
00:13:33,417 --> 00:13:35,877
You're you're you're speaking loudly in rooms with

376
00:13:36,115 --> 00:13:37,227
with leaders in the United States.

377
00:13:38,037 --> 00:13:39,548
What sort of advice do you do you

378
00:13:39,548 --> 00:13:42,252
provide to ensure that the downstream impact of

379
00:13:42,252 --> 00:13:45,513
this isn't also disastrous for for economies like

380
00:13:45,513 --> 00:13:47,842
ours? Well, let's start with the reality of

381
00:13:47,842 --> 00:13:48,642
the exposure.

382
00:13:50,080 --> 00:13:51,518
The Chinese are the king of low end.

383
00:13:51,678 --> 00:13:53,196
If it deals with assembly or things that

384
00:13:53,196 --> 00:13:54,176
are not too technically

385
00:13:55,049 --> 00:13:56,722
challenging, and this is where the Chinese can

386
00:13:56,722 --> 00:13:59,032
compete because they compete on scale. As you

387
00:13:59,032 --> 00:14:00,706
move up the value added scale, they bring

388
00:14:00,706 --> 00:14:01,901
less and lists to the table.

389
00:14:03,427 --> 00:14:05,336
This is an an economy that has seen

390
00:14:05,336 --> 00:14:07,880
their costs of labor go up by a

391
00:14:07,880 --> 00:14:09,391
factor of 15 or 16 in the last

392
00:14:09,391 --> 00:14:11,777
25 years, but labor productivity is barely tripled.

393
00:14:12,429 --> 00:14:14,582
So there aren't a lot of sectors where

394
00:14:14,582 --> 00:14:17,533
value add is the critical component of the

395
00:14:17,533 --> 00:14:20,404
mix where the Chinese are players and unless

396
00:14:20,404 --> 00:14:22,809
they just massively suck Isaac it, which they

397
00:14:22,809 --> 00:14:22,968
do.

398
00:14:23,683 --> 00:14:25,137
The places where

399
00:14:25,750 --> 00:14:28,691
they are competitive are in industries where the

400
00:14:28,691 --> 00:14:30,281
value add is very low and it's usually

401
00:14:30,281 --> 00:14:31,020
about processing

402
00:14:31,729 --> 00:14:33,644
And in those sectors, they're born in the

403
00:14:33,644 --> 00:14:36,378
world later. So whether it's aluminum or

404
00:14:37,634 --> 00:14:38,852
cobalt or copper

405
00:14:39,404 --> 00:14:41,790
40 to 70 percent of global processing for

406
00:14:41,790 --> 00:14:43,483
a lot of these materials

407
00:14:43,938 --> 00:14:46,998
is China centric. Now there's nothing nothing

408
00:14:47,373 --> 00:14:50,234
about this processing process that is difficult or

409
00:14:50,234 --> 00:14:52,403
expensive or even time consuming to relocate.

410
00:14:53,174 --> 00:14:53,674
But

411
00:14:54,302 --> 00:14:57,166
easy and cheap and fast is not the

412
00:14:57,166 --> 00:14:59,871
same as immediate and free.

413
00:15:01,478 --> 00:15:03,653
So when I think about things like aluminum

414
00:15:04,110 --> 00:15:05,067
or lithium,

415
00:15:05,545 --> 00:15:07,699
that's where the biggest shock will be. When

416
00:15:07,778 --> 00:15:09,852
I think about things like steel rebar where

417
00:15:09,852 --> 00:15:10,512
the Chinese

418
00:15:11,143 --> 00:15:13,373
have an advantage because of their subsidies. It's

419
00:15:13,373 --> 00:15:14,648
not that this can't be done either and

420
00:15:14,648 --> 00:15:15,843
it's not that we don't do it ourselves.

421
00:15:16,242 --> 00:15:17,676
It's just the shock to the system if

422
00:15:17,676 --> 00:15:19,986
this word to end overnight would be significant.

423
00:15:20,720 --> 00:15:22,079
But as you move up the value add,

424
00:15:22,320 --> 00:15:23,519
it becomes less and less of a factor.

425
00:15:23,679 --> 00:15:26,320
So high end chemicals, mid tier chemicals,

426
00:15:27,440 --> 00:15:27,839
automotive,

427
00:15:28,480 --> 00:15:30,250
things as simple as a spark plug the

428
00:15:30,329 --> 00:15:31,920
Chinese Do and they do it scale, but

429
00:15:31,920 --> 00:15:33,591
they don't do it well, and they don't

430
00:15:33,591 --> 00:15:35,818
do it at a particularly competitive price point.

431
00:15:36,549 --> 00:15:38,398
So there really are for

432
00:15:38,930 --> 00:15:40,438
the end result of things.

433
00:15:40,914 --> 00:15:42,819
The the the point of the spear and

434
00:15:42,819 --> 00:15:43,692
manufacturing if you will.

435
00:15:44,820 --> 00:15:47,787
That I'm less worried about. It's the building

436
00:15:48,003 --> 00:15:49,299
block or I'm most

437
00:15:49,674 --> 00:15:50,890
concerned. Now

438
00:15:51,758 --> 00:15:53,190
If you love the chips fall where they

439
00:15:53,190 --> 00:15:54,623
may in a free market system.

440
00:15:55,100 --> 00:15:57,169
Most of that sort of industry is going

441
00:15:57,169 --> 00:15:59,579
to go to places with the cheapest energy

442
00:15:59,636 --> 00:16:01,722
and the cheapest cost of production of the

443
00:16:01,722 --> 00:16:01,962
ore.

444
00:16:02,840 --> 00:16:05,234
For most of these things, the ore is

445
00:16:05,234 --> 00:16:07,309
pretty spread out around the world, and the

446
00:16:07,469 --> 00:16:09,200
United States does have by far the cheap

447
00:16:09,637 --> 00:16:11,226
electricity in the world because we have the

448
00:16:11,226 --> 00:16:13,451
best territory on the planet aside from Australia

449
00:16:13,451 --> 00:16:15,914
for Green tech, and we have the cheapest

450
00:16:15,914 --> 00:16:18,236
natural gas. On the planet, and we have

451
00:16:18,236 --> 00:16:20,305
the cheapest high caloric content coal.

452
00:16:21,499 --> 00:16:23,648
So if you let everything go in time,

453
00:16:23,728 --> 00:16:25,811
it will all back here. My concern is

454
00:16:25,811 --> 00:16:27,959
it's gonna be a shock. So I'm of

455
00:16:27,959 --> 00:16:30,663
the opinion that every day that China doesn't

456
00:16:30,663 --> 00:16:30,982
collapse.

457
00:16:31,872 --> 00:16:32,610
Is a gift

458
00:16:33,145 --> 00:16:35,135
because it gives us a day to get

459
00:16:35,135 --> 00:16:37,841
ready for the end of those supply lines.

460
00:16:38,318 --> 00:16:39,910
And we are seeing more and more and

461
00:16:39,910 --> 00:16:40,919
more of even the

462
00:16:41,440 --> 00:16:43,360
low end stuff coming back to the United

463
00:16:43,600 --> 00:16:46,000
States, with I would argue the Gulf coast

464
00:16:46,000 --> 00:16:47,279
being in the area that's going to be

465
00:16:47,279 --> 00:16:48,973
adding the most not only does it have

466
00:16:48,973 --> 00:16:52,888
the really cheap electricity and approximate industrial capacity

467
00:16:52,888 --> 00:16:54,087
places like the Texas triangle.

468
00:16:54,966 --> 00:16:57,371
The view of invite metal production in places

469
00:16:57,371 --> 00:16:59,359
like Louisiana and the Texas Coast are somewhat

470
00:16:59,359 --> 00:17:01,665
lower than the national average, which provides us

471
00:17:01,665 --> 00:17:03,176
some opportunity in that space.

472
00:17:04,543 --> 00:17:06,775
But China was long the most populous country

473
00:17:06,775 --> 00:17:07,413
in the world.

474
00:17:07,891 --> 00:17:10,043
You've noted that perhaps by 20 55 that

475
00:17:10,043 --> 00:17:12,036
will have half its current population.

476
00:17:12,767 --> 00:17:14,828
It's just recent months that at least officially,

477
00:17:15,304 --> 00:17:17,444
India re... Has taken over the title of

478
00:17:17,444 --> 00:17:18,182
most populous

479
00:17:19,189 --> 00:17:19,743
country in the world.

480
00:17:20,393 --> 00:17:22,535
How bullish or bearish are you regarding India's

481
00:17:22,535 --> 00:17:22,932
prospects?

482
00:17:23,884 --> 00:17:26,105
Whenever I talk to the Indians, I... First

483
00:17:26,105 --> 00:17:27,930
thing I make clear is you are not

484
00:17:27,930 --> 00:17:29,374
going to be the next China and you

485
00:17:29,374 --> 00:17:30,963
do not want to be.

486
00:17:31,757 --> 00:17:34,538
The the strength of the Chinese system is,

487
00:17:35,729 --> 00:17:38,922
a dictator state forces everybody into the same

488
00:17:38,922 --> 00:17:42,179
page and a a huge subsidy system that

489
00:17:42,179 --> 00:17:43,791
is financially wildly

490
00:17:44,721 --> 00:17:46,492
inefficient, but does allocate

491
00:17:47,199 --> 00:17:49,037
capital to productive uses in order to keep

492
00:17:49,037 --> 00:17:50,256
those populations

493
00:17:50,875 --> 00:17:53,511
happy and marching in the same direction. You're

494
00:17:53,511 --> 00:17:55,760
never gonna get that in India. In India,

495
00:17:55,999 --> 00:17:58,148
capital isn't a political good. It actually has

496
00:17:58,148 --> 00:18:00,217
a value, which means that you don't make

497
00:18:00,217 --> 00:18:01,650
loans just to make loans. You don't make

498
00:18:01,650 --> 00:18:03,798
loans to guarantee high employment. You make loans

499
00:18:03,798 --> 00:18:05,401
because there might be turn on the other

500
00:18:05,401 --> 00:18:07,937
side. It's much more efficient in that way.

501
00:18:09,521 --> 00:18:11,210
And if you were to apply the Chinese

502
00:18:11,264 --> 00:18:13,741
mile to India, you'd probably end up with

503
00:18:13,741 --> 00:18:14,638
the same rapid

504
00:18:15,171 --> 00:18:17,396
industrialization, but then followed by the same civilization

505
00:18:17,396 --> 00:18:19,700
collapse and India is smarter than that. They're

506
00:18:19,700 --> 00:18:20,257
better than that.

507
00:18:20,907 --> 00:18:22,495
That doesn't mean that India doesn't have its

508
00:18:22,495 --> 00:18:24,402
own problems well My God India has its

509
00:18:24,402 --> 00:18:24,640
problems.

510
00:18:25,434 --> 00:18:27,102
Their problem is that they basically have 30

511
00:18:27,102 --> 00:18:29,667
different regions at 30 different countries, 30 different

512
00:18:29,723 --> 00:18:31,886
economics systems, and they don't integrate well.

513
00:18:32,523 --> 00:18:34,275
The... It's not just a policy issue. It's

514
00:18:34,275 --> 00:18:37,618
not just a geography issue. It's it's a

515
00:18:37,618 --> 00:18:38,096
corruption issue.

516
00:18:38,826 --> 00:18:41,231
And that makes it difficult for the political

517
00:18:41,287 --> 00:18:42,263
leadership of 1

518
00:18:42,795 --> 00:18:45,652
Indian state to integrate with another 1 even

519
00:18:45,652 --> 00:18:46,922
if it's a perfect match.

520
00:18:47,653 --> 00:18:49,031
Politics there are very

521
00:18:49,488 --> 00:18:51,961
localized. It's a true federal system kinda like

522
00:18:51,961 --> 00:18:54,114
the United States or Germany, where the national

523
00:18:54,114 --> 00:18:56,268
state and local governments all have roughly the

524
00:18:56,268 --> 00:18:58,356
same amount of power And it makes policy

525
00:18:58,356 --> 00:18:59,153
making a mess,

526
00:19:00,270 --> 00:19:02,184
but it does mean that you can always

527
00:19:02,184 --> 00:19:03,699
learn from 1 another, which is why you

528
00:19:03,699 --> 00:19:05,693
have places like the Bangalore corridor that are

529
00:19:05,693 --> 00:19:08,096
basically first world economies and other places are

530
00:19:08,096 --> 00:19:10,741
basically giant call centers and other places have

531
00:19:11,750 --> 00:19:12,068
failed.

532
00:19:12,863 --> 00:19:15,247
But let me under something on the population.

533
00:19:15,900 --> 00:19:19,259
Chinese data isn't great. They're keep updating it

534
00:19:19,340 --> 00:19:19,980
Thank God.

535
00:19:21,180 --> 00:19:23,992
But I would argue that India surpassed the

536
00:19:24,072 --> 00:19:27,657
Chinese population something like 15 years ago. With

537
00:19:27,657 --> 00:19:29,330
the new insight we've gotten in just the

538
00:19:29,330 --> 00:19:30,286
last 12 months,

539
00:19:30,939 --> 00:19:33,966
So we've already been not so tip toe

540
00:19:33,966 --> 00:19:36,595
towards this new world for quite some time

541
00:19:36,595 --> 00:19:39,075
now, and we had 5 year period where

542
00:19:39,075 --> 00:19:40,821
the Chinese were in a degree of information

543
00:19:40,821 --> 00:19:42,647
locked down during Covid where we didn't get

544
00:19:42,647 --> 00:19:45,187
any good information. On the backside of that,

545
00:19:45,346 --> 00:19:46,750
we're finally seen that

546
00:19:47,349 --> 00:19:48,730
A lot of these peaks

547
00:19:49,029 --> 00:19:49,750
in China,

548
00:19:50,549 --> 00:19:54,877
car sales, cover consumption maybe didn't simply come

549
00:19:54,877 --> 00:19:56,466
in the last 12 months or even during

550
00:19:56,545 --> 00:19:58,213
Covid, but actually date back to like, 20

551
00:19:58,213 --> 00:20:01,072
17 20 18. On the demographic picture, it

552
00:20:01,072 --> 00:20:02,994
looks like it was a lot. Further back

553
00:20:02,994 --> 00:20:04,823
than that. Like, we now know that the

554
00:20:04,902 --> 00:20:07,287
Chinese birth rate probably dropped below the American

555
00:20:07,287 --> 00:20:08,797
birth rate back in the early nineties.

556
00:20:10,401 --> 00:20:13,255
Interesting points about how how, how accurate the

557
00:20:13,255 --> 00:20:14,786
data is and how that might

558
00:20:15,237 --> 00:20:17,457
reflect differences there as as you point out,

559
00:20:17,869 --> 00:20:19,700
Well, we we started our conversation with 1

560
00:20:19,779 --> 00:20:21,769
Russian strong man. Let's let's move on to

561
00:20:21,769 --> 00:20:22,167
another 1,

562
00:20:23,281 --> 00:20:23,759
in Putin,

563
00:20:24,714 --> 00:20:26,783
in 20 10, you predicted that Russia would

564
00:20:26,783 --> 00:20:29,348
invade the ukraine in 20 22,

565
00:20:30,226 --> 00:20:31,820
quite quite a prediction while done Peter.

566
00:20:32,538 --> 00:20:33,835
Sorry why

567
00:20:34,451 --> 00:20:35,966
was that so clear to you, then?

568
00:20:37,096 --> 00:20:39,085
Okay. So there's 2 pieces to this. First,

569
00:20:39,244 --> 00:20:40,438
the why it has to happen.

570
00:20:41,233 --> 00:20:43,382
The Russian frontier in its current forms is

571
00:20:43,382 --> 00:20:46,120
completely offended. It's it's wide open it's populated.

572
00:20:46,652 --> 00:20:48,874
There's no way for the Russians in any

573
00:20:48,874 --> 00:20:50,937
form with no matter how confident their government

574
00:20:50,937 --> 00:20:53,096
no matter how powerful for their military. To

575
00:20:53,096 --> 00:20:55,085
patrol and secure the entire border system. It's

576
00:20:55,085 --> 00:20:56,699
something like 5000

577
00:20:57,233 --> 00:20:57,870
kilometers long.

578
00:20:58,984 --> 00:20:59,484
But

579
00:21:00,257 --> 00:21:01,473
if they were advanced

580
00:21:01,783 --> 00:21:03,853
to advance past their current borders and to

581
00:21:03,853 --> 00:21:05,365
get something a little bit more similar to

582
00:21:05,365 --> 00:21:07,355
what they had in the Soviet period. They

583
00:21:07,355 --> 00:21:11,390
could anchor their military in places of geographic

584
00:21:11,906 --> 00:21:12,406
constraint

585
00:21:12,780 --> 00:21:15,801
where mountains and seas can provide a defensive

586
00:21:15,801 --> 00:21:17,867
bull work, and then they concentrate their forces

587
00:21:17,867 --> 00:21:19,793
on the places between those. Like the Polish

588
00:21:19,793 --> 00:21:21,788
gap, like the best Arabian gap in Romania,

589
00:21:22,267 --> 00:21:23,565
like the caucus is

590
00:21:24,741 --> 00:21:27,476
coastal strips. And then their entire

591
00:21:27,789 --> 00:21:31,537
internal boundaries are less than 500 miles. That's

592
00:21:31,537 --> 00:21:33,531
something that they can do. So they've been

593
00:21:33,531 --> 00:21:35,525
working on some version of this for the

594
00:21:35,525 --> 00:21:37,612
entirety that we have had an entity called

595
00:21:37,771 --> 00:21:39,281
Russia over 4 centuries.

596
00:21:39,838 --> 00:21:42,382
They achieved it under Stalin, they lost it

597
00:21:42,382 --> 00:21:44,608
with the post Soviet collapse. And everything that

598
00:21:44,608 --> 00:21:46,278
they've done, and by they, I mean, the

599
00:21:46,437 --> 00:21:49,319
Russian state, not putin. This pre dates putin.

600
00:21:49,717 --> 00:21:51,231
Everything that the Russian this state has done

601
00:21:51,231 --> 00:21:53,779
since 19 89 has been about out been

602
00:21:53,779 --> 00:21:55,930
about reestablish that outer crust defense.

603
00:21:57,301 --> 00:21:59,295
Ukraine is not the first post soviet war

604
00:21:59,295 --> 00:22:01,528
with that goal. It's the ninth, and it

605
00:22:01,528 --> 00:22:03,522
won't be the last if they win. So

606
00:22:03,522 --> 00:22:05,675
that's the why. The why now is demographic.

607
00:22:06,883 --> 00:22:09,027
Russia has these peaks and trough in the

608
00:22:09,027 --> 00:22:10,480
demographic structure that largely

609
00:22:11,012 --> 00:22:13,895
line up with either major wars or majors

610
00:22:15,078 --> 00:22:17,168
centralization collapses, and

611
00:22:18,019 --> 00:22:18,519
mismanagement,

612
00:22:19,053 --> 00:22:21,676
whether it's k jaw forcing everyone into apartments,

613
00:22:22,169 --> 00:22:24,722
or World War 2 causing 20000000 civilian deaths.

614
00:22:24,962 --> 00:22:26,956
You got these giant go out of their

615
00:22:26,956 --> 00:22:27,754
demographic structure.

616
00:22:28,313 --> 00:22:30,002
But none of them are a of severe

617
00:22:30,002 --> 00:22:32,230
is what happened after 19 92.

618
00:22:32,946 --> 00:22:34,538
The economic system collapsed,

619
00:22:35,095 --> 00:22:38,118
we had several years of a corrupt government

620
00:22:38,118 --> 00:22:40,360
under yelp and that basically did nothing to

621
00:22:40,360 --> 00:22:41,234
stop the free fall.

622
00:22:42,109 --> 00:22:44,018
Culminating into the collapse of 19 98.

623
00:22:44,495 --> 00:22:46,801
And during that period, the death rates stored

624
00:22:46,801 --> 00:22:49,203
the birth rate crash and for almost 20

625
00:22:49,203 --> 00:22:50,878
years, we had a death rate that was

626
00:22:50,878 --> 00:22:52,074
twice as high as the birth rate.

627
00:22:52,792 --> 00:22:55,264
And even if you believe the statistics that

628
00:22:55,264 --> 00:22:58,135
the Russians started making up 15 years ago,

629
00:22:58,629 --> 00:23:00,383
This is a population structure that is so

630
00:23:00,383 --> 00:23:02,217
far past the pale that recovery just isn't

631
00:23:02,217 --> 00:23:03,413
even theoretically possible,

632
00:23:04,051 --> 00:23:05,406
which means that the men that they have

633
00:23:05,406 --> 00:23:07,342
in their twenties are really their last

634
00:23:07,973 --> 00:23:11,006
group of deployable forces that they will ever

635
00:23:11,006 --> 00:23:11,404
have.

636
00:23:12,123 --> 00:23:13,958
And 20 22 was kind of in the

637
00:23:13,958 --> 00:23:15,728
middle of the date range that I saw

638
00:23:15,728 --> 00:23:17,242
where if they were gonna... If they waited

639
00:23:17,242 --> 00:23:17,959
any longer,

640
00:23:18,517 --> 00:23:20,190
they simply wouldn't have the people to even

641
00:23:20,190 --> 00:23:20,690
theoretically

642
00:23:21,066 --> 00:23:22,341
attempt a military solution.

643
00:23:22,993 --> 00:23:24,986
So it always had to happen. It always

644
00:23:24,986 --> 00:23:26,182
had to happen about them.

645
00:23:27,058 --> 00:23:28,971
And if they keep losing people at their

646
00:23:28,971 --> 00:23:30,268
current rate and there's

647
00:23:30,979 --> 00:23:33,537
thousand ifs that are condensed into that if.

648
00:23:34,735 --> 00:23:38,012
They probably can only sustain this for about

649
00:23:38,012 --> 00:23:39,950
another 6 to 9 years

650
00:23:40,424 --> 00:23:41,939
and then they simply don't have the people

651
00:23:41,939 --> 00:23:42,418
to try.

652
00:23:43,375 --> 00:23:45,608
Well, you've noted that Russia always does long

653
00:23:45,608 --> 00:23:48,639
wars, not quick ones. Right. And when you're

654
00:23:48,639 --> 00:23:51,206
running out of people that's strategy doesn't work

655
00:23:51,206 --> 00:23:52,642
as well. Exactly Right.

656
00:23:53,918 --> 00:23:55,354
Well, you... You've noted that you're out of

657
00:23:55,354 --> 00:23:57,609
the prediction game on the world Ukraine on

658
00:23:57,667 --> 00:23:59,661
multiple places I've seen you you speak. And

659
00:23:59,661 --> 00:24:01,755
but I wonder if you can walk through

660
00:24:01,755 --> 00:24:04,634
what would need to happen for Ukraine to

661
00:24:04,634 --> 00:24:06,794
get the upper hand versus what would need

662
00:24:06,794 --> 00:24:08,714
to happen for Russia to to do so.

663
00:24:09,369 --> 00:24:10,410
Well, let's start with the Russians.

664
00:24:11,130 --> 00:24:14,569
As long as they can maintain supply flows

665
00:24:14,569 --> 00:24:15,630
from North Korea

666
00:24:15,930 --> 00:24:19,025
for artillery from Iran for drones and should

667
00:24:19,144 --> 00:24:21,479
for China for electronics and metallurgy.

668
00:24:22,255 --> 00:24:24,887
You marry that to the Soviet arsenal, and

669
00:24:24,887 --> 00:24:26,823
they are not looking at it a meaningful

670
00:24:26,961 --> 00:24:28,795
equipment shortage within the next 5 years.

671
00:24:29,846 --> 00:24:31,518
Based on how long China lasts, it could

672
00:24:31,518 --> 00:24:33,191
be a little bit longer than that. So

673
00:24:33,191 --> 00:24:35,102
at least in the midterm, they're fine on

674
00:24:35,102 --> 00:24:38,643
equipment. And because this is their last war

675
00:24:38,700 --> 00:24:41,961
and they realize that, the manpower issue is

676
00:24:41,961 --> 00:24:43,314
not an issue either it's just a question

677
00:24:43,314 --> 00:24:44,746
of how they politically manage drafting.

678
00:24:45,555 --> 00:24:46,746
I don't think that is going to be

679
00:24:46,746 --> 00:24:48,493
the thing that bring down the government. So

680
00:24:48,493 --> 00:24:51,272
minimum 5 years for the Russians things look,

681
00:24:51,590 --> 00:24:52,940
I don't wanna say hun dory, but they

682
00:24:52,940 --> 00:24:53,972
can maintain their flows.

683
00:24:54,624 --> 00:24:56,697
And they're finding new and innovative ways to

684
00:24:56,697 --> 00:24:59,408
use their old weapon systems in did more

685
00:24:59,408 --> 00:25:02,120
devastating capacity. So for example, the glide bombs

686
00:25:02,120 --> 00:25:05,168
or the most recent innovation basically dropping a

687
00:25:05,168 --> 00:25:07,485
metric ton of explosives on an urban center

688
00:25:07,485 --> 00:25:10,122
and just bit by bit making the front

689
00:25:10,122 --> 00:25:11,660
zone completely une inhabit

690
00:25:12,053 --> 00:25:14,440
so that if you're the Cra military, you

691
00:25:14,440 --> 00:25:17,065
lose an interest in defending something that no

692
00:25:17,065 --> 00:25:18,178
longer has a value.

693
00:25:19,466 --> 00:25:21,534
They started with the power centers. They're now

694
00:25:21,534 --> 00:25:23,682
going after things like apartment blocks and just

695
00:25:23,682 --> 00:25:25,512
making places completely un unbelievable.

696
00:25:26,481 --> 00:25:29,185
That's not... It it's in humane, but it's

697
00:25:29,185 --> 00:25:31,650
not a stupid strategy from a strategic point

698
00:25:31,650 --> 00:25:33,559
of view. And if you can cause enough

699
00:25:33,559 --> 00:25:34,059
havoc

700
00:25:34,448 --> 00:25:37,148
that the West realizes that the rebuilding might

701
00:25:37,148 --> 00:25:39,371
not be worth the cost, maybe maybe maybe,

702
00:25:40,642 --> 00:25:42,230
it's an open question about how long the

703
00:25:42,389 --> 00:25:43,183
Ukrainians can.

704
00:25:44,232 --> 00:25:45,506
Maintain defensive operations.

705
00:25:46,303 --> 00:25:49,112
It's a legitimate conclusion no matter how horrible

706
00:25:49,170 --> 00:25:49,568
it sounds.

707
00:25:50,444 --> 00:25:52,377
On the other side, the issues is Crimea

708
00:25:53,646 --> 00:25:56,279
Because of the shape of the land because

709
00:25:56,279 --> 00:25:58,433
of the presence of the Ne river,

710
00:25:59,231 --> 00:26:01,788
any sub apply going into crimea, it basically

711
00:26:01,788 --> 00:26:03,533
has to come from 1 of 3 routes.

712
00:26:04,565 --> 00:26:06,945
You've got a rail ferry bridge, basically bringing

713
00:26:06,945 --> 00:26:09,260
things in by water. That the Ukrainians have

714
00:26:09,260 --> 00:26:12,275
largely destroyed. They've also destroyed most of the

715
00:26:12,354 --> 00:26:15,265
Russian landing ships in general. So supplying by

716
00:26:15,384 --> 00:26:17,294
see has become very, very hard. Number 2,

717
00:26:17,453 --> 00:26:18,329
you got the Kirk Bridge,

718
00:26:18,966 --> 00:26:21,672
which goes from Ross Don or, the railway

719
00:26:21,672 --> 00:26:22,389
goes in from Ross,

720
00:26:23,519 --> 00:26:24,019
south

721
00:26:24,476 --> 00:26:27,108
into the k straight and then crossing in

722
00:26:27,108 --> 00:26:29,660
primary pet Peninsula. That's taken enough hits that

723
00:26:29,660 --> 00:26:32,133
its ability to take mass cargo has been

724
00:26:32,133 --> 00:26:33,502
limited pretty strict fleet.

725
00:26:34,693 --> 00:26:36,916
And I think with these new weapon systems

726
00:26:36,916 --> 00:26:39,218
that the Ukraine recently gotten, the K bridge

727
00:26:39,218 --> 00:26:40,806
is not gonna be around much longer anyway.

728
00:26:41,619 --> 00:26:44,180
Then third, you've got a series of rail

729
00:26:44,180 --> 00:26:45,320
connections that are on

730
00:26:45,779 --> 00:26:47,220
southern shore Ukraine proper,

731
00:26:47,700 --> 00:26:50,075
and while they are in long range rock

732
00:26:50,432 --> 00:26:51,624
artillery range in many cases,

733
00:26:52,338 --> 00:26:54,586
the Ukrainians don't have a liability to target

734
00:26:54,801 --> 00:26:55,834
the trains with artillery.

735
00:26:56,390 --> 00:26:57,661
So that's where the bulk of things are

736
00:26:57,661 --> 00:26:58,296
going right now.

737
00:26:59,347 --> 00:26:59,847
If

738
00:27:00,702 --> 00:27:01,202
Ukraine

739
00:27:01,658 --> 00:27:04,448
can cut that final rail system,

740
00:27:04,926 --> 00:27:06,383
then the Russians would be

741
00:27:07,253 --> 00:27:09,746
forced to ship anything

742
00:27:10,202 --> 00:27:11,897
to crimea by truck

743
00:27:12,433 --> 00:27:14,346
from Russia Proper through the Don boss,

744
00:27:14,918 --> 00:27:16,691
past mir and multiple

745
00:27:17,066 --> 00:27:19,930
and across a single road and rail system

746
00:27:19,930 --> 00:27:21,441
to get into Crimea proper.

747
00:27:23,050 --> 00:27:26,480
That's over a thousand kilometer long supply line

748
00:27:26,480 --> 00:27:26,980
by

749
00:27:27,357 --> 00:27:27,857
truck

750
00:27:28,554 --> 00:27:30,728
with the Ukrainians being able able to basically

751
00:27:30,787 --> 00:27:33,191
interject in multiple spots. If we get to

752
00:27:33,191 --> 00:27:35,339
that point, and that is basically what seems

753
00:27:35,339 --> 00:27:37,409
to be the Ukrainian goal for this summer

754
00:27:37,409 --> 00:27:39,080
once they get air power to try to

755
00:27:39,080 --> 00:27:41,412
cut that line. If they can do that,

756
00:27:42,930 --> 00:27:45,487
Crimea goes from a potential launch point Russian

757
00:27:45,487 --> 00:27:46,626
forces to the most

758
00:27:47,005 --> 00:27:47,505
exposed

759
00:27:48,057 --> 00:27:50,602
portion of the entire Russian land mass.

760
00:27:51,635 --> 00:27:52,851
And the public

761
00:27:53,544 --> 00:27:55,452
humiliation of having a couple million Russians in

762
00:27:55,452 --> 00:27:58,424
crimea starving because the Russians can't supply their

763
00:27:58,424 --> 00:28:00,524
own civilian population, much lesser military

764
00:28:00,825 --> 00:28:00,984
population.

765
00:28:02,264 --> 00:28:03,644
Ukrainians don't have to capture

766
00:28:04,439 --> 00:28:06,991
crimea to generate that outcome. They simply have

767
00:28:06,991 --> 00:28:08,507
to interject 1 train.

768
00:28:09,703 --> 00:28:11,878
And if you can have a global

769
00:28:12,654 --> 00:28:13,850
humiliation of putin,

770
00:28:14,982 --> 00:28:18,094
This is how about half of the governing

771
00:28:18,094 --> 00:28:20,727
systems in Russian history have ended from either

772
00:28:20,727 --> 00:28:21,445
internal collapse,

773
00:28:22,178 --> 00:28:22,996
or popular

774
00:28:23,371 --> 00:28:23,871
uprising

775
00:28:24,962 --> 00:28:26,792
because the Russians have lost a war very,

776
00:28:26,951 --> 00:28:29,753
very, very, very publicly, so some version of

777
00:28:29,753 --> 00:28:31,269
this is what went down for world war

778
00:28:31,269 --> 00:28:32,864
1 from some version of this is what

779
00:28:32,864 --> 00:28:35,018
went down for the Crimean war ironically.

780
00:28:36,056 --> 00:28:38,458
And that seems to be the Ukrainian short

781
00:28:38,458 --> 00:28:40,765
term goal, and that is also not a

782
00:28:40,765 --> 00:28:41,742
stupid strategy.

783
00:28:42,435 --> 00:28:44,287
So both of these things

784
00:28:45,313 --> 00:28:45,870
can work,

785
00:28:46,984 --> 00:28:48,894
and both of them are very, very ugly.

786
00:28:49,848 --> 00:28:50,724
Yeah. Very interesting.

787
00:28:51,360 --> 00:28:53,429
You Ukraine has the support of the Western

788
00:28:53,429 --> 00:28:53,747
world.

789
00:28:54,636 --> 00:28:55,987
And Russia has a support of countries like

790
00:28:56,146 --> 00:28:57,179
China and North Korea.

791
00:28:57,893 --> 00:28:59,562
So in many ways, this is a proxy

792
00:28:59,562 --> 00:29:01,468
war for China and the west to some

793
00:29:01,468 --> 00:29:03,153
degree and that the primary factors are of

794
00:29:03,153 --> 00:29:04,190
course, Russia and Ukraine.

795
00:29:04,987 --> 00:29:07,061
Are you are you fearful at all that

796
00:29:07,061 --> 00:29:09,055
the proxies might be drawn into the conflict?

797
00:29:09,454 --> 00:29:10,411
At the moment, no.

798
00:29:11,049 --> 00:29:12,460
If there is going to be a conflict

799
00:29:12,658 --> 00:29:14,480
that involves China it'll be under a a

800
00:29:14,480 --> 00:29:16,778
series of very, very different circumstances. Remember, the

801
00:29:16,857 --> 00:29:18,679
Chinese can't project power more than about a

802
00:29:18,679 --> 00:29:21,958
thousand miles. Thousand kilometers really, from their own

803
00:29:21,958 --> 00:29:23,633
shore. So the idea that they could get

804
00:29:23,633 --> 00:29:25,547
involved in something involving sea lanes in South

805
00:29:25,866 --> 00:29:27,642
Asia or much less in Ukraine

806
00:29:28,019 --> 00:29:31,141
beyond the pale, North Korea's, obviously significantly less

807
00:29:31,141 --> 00:29:32,175
capacity in that regard.

808
00:29:33,130 --> 00:29:34,959
And in the case of Iran, Iran and

809
00:29:35,039 --> 00:29:36,964
Israel are actually getting along as well it's

810
00:29:36,964 --> 00:29:38,162
possible for the 2 of them to get

811
00:29:38,162 --> 00:29:39,998
along right now. So I don't think that's

812
00:29:39,998 --> 00:29:41,195
a serious conflict either.

813
00:29:42,872 --> 00:29:45,027
I have never been of the opinion that

814
00:29:45,027 --> 00:29:47,112
a war between the United States China isn't

815
00:29:47,112 --> 00:29:49,173
inevitable, much less imminent. I don't wanna say

816
00:29:49,173 --> 00:29:50,204
it can't happen.

817
00:29:50,838 --> 00:29:53,296
But if we do get into a slug

818
00:29:53,296 --> 00:29:53,796
fast

819
00:29:54,342 --> 00:29:55,933
The United States is gonna put a few

820
00:29:55,933 --> 00:29:58,080
ships in Indian Ocean Basin, cut the energy

821
00:29:58,080 --> 00:30:00,625
artery, cut the manufactured goods artery, and we'll

822
00:30:00,625 --> 00:30:03,344
have a des civilization collapse China and under

823
00:30:03,344 --> 00:30:05,969
your complete the famine. 5 years ago she

824
00:30:05,969 --> 00:30:08,673
knew that. My only concern today is that

825
00:30:08,673 --> 00:30:11,234
he is so destroyed the capacity of information

826
00:30:11,234 --> 00:30:13,303
to flow within the Chinese system that maybe

827
00:30:13,303 --> 00:30:14,019
he's forgotten it.

828
00:30:15,133 --> 00:30:17,519
The 2 countries we primarily spoken about so

829
00:30:17,519 --> 00:30:17,758
far,

830
00:30:18,648 --> 00:30:21,686
China and Russia are also led by paranoid

831
00:30:21,979 --> 00:30:23,248
dictators who have nuclear arms.

832
00:30:24,359 --> 00:30:25,945
And talk about the risks of the combination

833
00:30:25,945 --> 00:30:27,875
of those factors. Yeah. Not a non factor.

834
00:30:28,115 --> 00:30:28,275
Now.

835
00:30:29,234 --> 00:30:30,674
To the degree that the United States has

836
00:30:30,674 --> 00:30:32,595
a missile defense system, it was designed for

837
00:30:32,595 --> 00:30:34,115
the Chinese system and while they have been

838
00:30:34,115 --> 00:30:35,234
adding more and more silos,

839
00:30:35,728 --> 00:30:37,661
we have learned in the last year that

840
00:30:37,718 --> 00:30:39,947
corruption and theft within the Chinese procurement system

841
00:30:39,947 --> 00:30:42,255
is if anything bigger than what's going on

842
00:30:42,255 --> 00:30:44,901
in the Russian procurement. System with the nuclear

843
00:30:44,901 --> 00:30:46,657
forces being the 1 that has leaked out

844
00:30:46,657 --> 00:30:47,056
the most.

845
00:30:48,014 --> 00:30:50,807
Specifically, the Chinese general who is responsible for

846
00:30:50,807 --> 00:30:51,606
maintaining the silos,

847
00:30:52,498 --> 00:30:54,334
stole the money that was supposed to go

848
00:30:54,334 --> 00:30:55,929
for the fuel for the rockets and just

849
00:30:55,929 --> 00:30:57,924
filled them up with water, which probably makes

850
00:30:57,924 --> 00:30:59,062
the rockets useless.

851
00:31:00,095 --> 00:31:01,855
I would not be willing to bet the

852
00:31:01,855 --> 00:31:04,095
existence of the United States on that fact,

853
00:31:04,335 --> 00:31:06,654
but there is no way that this is

854
00:31:06,654 --> 00:31:07,615
a single data point.

855
00:31:08,266 --> 00:31:10,090
This is something that is very easy to

856
00:31:10,090 --> 00:31:11,994
discover. So anything that he was trying to

857
00:31:11,994 --> 00:31:14,453
actually hide is probably worse.

858
00:31:15,023 --> 00:31:16,370
I I wanna say I'm not... I don't

859
00:31:16,370 --> 00:31:19,143
worry about China at all, but not to

860
00:31:19,143 --> 00:31:20,728
the same degree as most people in the

861
00:31:20,728 --> 00:31:22,645
military industrial complex in the United. States. I

862
00:31:22,645 --> 00:31:24,626
just I don't see it. I don't see

863
00:31:24,626 --> 00:31:26,290
the capacity for power for projection.

864
00:31:27,083 --> 00:31:28,509
In the case of Russia, that isn't much

865
00:31:28,509 --> 00:31:31,312
more serious threat. A number of deliverable weapon

866
00:31:31,312 --> 00:31:34,268
systems is much higher, and that's before you

867
00:31:34,268 --> 00:31:35,626
include the ones that have been moth ball,

868
00:31:35,706 --> 00:31:36,825
but not dismantled.

869
00:31:37,239 --> 00:31:39,307
So you're talking about basically a thousand delivery

870
00:31:39,307 --> 00:31:42,171
platforms today. And if if if they decided

871
00:31:42,171 --> 00:31:43,841
they wanted to bring their old stuff out.

872
00:31:44,254 --> 00:31:46,090
They could expand that by a factor of

873
00:31:46,090 --> 00:31:47,229
5 or 6 theoretically.

874
00:31:47,767 --> 00:31:49,923
Our missile system is not designed for that,

875
00:31:50,801 --> 00:31:52,477
not just in terms of numbers in terms

876
00:31:52,477 --> 00:31:53,355
of coverage,

877
00:31:54,008 --> 00:31:57,036
Our hardware our fixed ground placements are on

878
00:31:57,036 --> 00:31:59,346
the West coast and Alaska, designed for North

879
00:31:59,506 --> 00:32:00,781
Korea assigned for China,

880
00:32:01,431 --> 00:32:03,255
our East Coast doesn't have that. We've got

881
00:32:03,255 --> 00:32:05,238
a lot of mobile systems, but not sufficient

882
00:32:05,238 --> 00:32:07,775
to cover all of our population centers. So

883
00:32:07,775 --> 00:32:08,275
if

884
00:32:09,616 --> 00:32:11,286
1 of these red lines that the Russians

885
00:32:11,286 --> 00:32:13,592
keep lying about actually turns out to be

886
00:32:13,592 --> 00:32:14,092
real,

887
00:32:15,103 --> 00:32:17,091
then we could have a very serious problem.

888
00:32:17,742 --> 00:32:20,201
So we've got this fun little situation where

889
00:32:20,201 --> 00:32:22,264
we've got 2 kind of general camps in

890
00:32:22,264 --> 00:32:24,247
the United states. Those who take the red

891
00:32:24,247 --> 00:32:25,517
lines very, very seriously.

892
00:32:25,929 --> 00:32:28,315
And think that as a result, we should

893
00:32:28,315 --> 00:32:30,065
become Neville Chamberlain and just let the Russians

894
00:32:30,065 --> 00:32:31,656
have whatever they want. They want you Ukraine

895
00:32:31,656 --> 00:32:32,691
and let them have it. They went poland

896
00:32:32,691 --> 00:32:33,645
and they let them know happen. They want

897
00:32:33,725 --> 00:32:35,253
Germany let them have it. Let them have

898
00:32:35,253 --> 00:32:37,168
all of nature. Let them have Mexico. Basically

899
00:32:37,168 --> 00:32:38,126
just stand by,

900
00:32:38,684 --> 00:32:40,599
stand back and let them brushes do whatever

901
00:32:40,599 --> 00:32:42,195
they want. You know, that that's idiotic.

902
00:32:43,404 --> 00:32:44,437
And not very American.

903
00:32:45,073 --> 00:32:46,106
The other side,

904
00:32:48,093 --> 00:32:50,000
it's like, we should give the Ukrainians every

905
00:32:50,000 --> 00:32:52,241
weapon system they possibly can. We should allow

906
00:32:52,241 --> 00:32:54,071
them to target everything they want whenever they

907
00:32:54,071 --> 00:32:55,902
want. However they want and we should actively

908
00:32:55,902 --> 00:32:56,300
assist them.

909
00:32:57,494 --> 00:32:59,006
That's too extreme in the other direction.

910
00:33:00,216 --> 00:33:01,809
This is a country that has a missile

911
00:33:01,809 --> 00:33:04,120
system that was designed to obliterate the United

912
00:33:04,359 --> 00:33:04,518
States.

913
00:33:05,474 --> 00:33:08,115
And while they have bluff over and over

914
00:33:08,115 --> 00:33:10,183
and over and over and over about where

915
00:33:10,183 --> 00:33:11,216
the red line is.

916
00:33:11,932 --> 00:33:13,625
We only have to be wrong

917
00:33:13,999 --> 00:33:14,397
once.

918
00:33:15,127 --> 00:33:16,957
For this to get out of control. So

919
00:33:17,037 --> 00:33:18,173
I think the Biden

920
00:33:18,548 --> 00:33:20,775
administration when it comes to security policy relating

921
00:33:20,775 --> 00:33:21,673
to Ukraine

922
00:33:22,461 --> 00:33:23,518
has broadly

923
00:33:24,053 --> 00:33:24,553
struck

924
00:33:25,485 --> 00:33:29,146
the right degree of caution versus aggressive miss.

925
00:33:30,750 --> 00:33:32,575
Basically what we've done for the last 2

926
00:33:32,575 --> 00:33:34,186
years is when the Russians

927
00:33:34,717 --> 00:33:35,749
state a red line,

928
00:33:36,622 --> 00:33:37,892
1 country in Nato.

929
00:33:39,263 --> 00:33:40,941
Puts a toe across it just to see

930
00:33:40,941 --> 00:33:43,018
what happens, and then they step across it,

931
00:33:43,817 --> 00:33:45,415
and then other countries join in.

932
00:33:46,068 --> 00:33:48,778
And 3 weeks later, everyone's doing it. So

933
00:33:48,778 --> 00:33:50,929
this happened with artillery. This happened with the

934
00:33:50,929 --> 00:33:52,922
storm shadows has happened with the Ja most

935
00:33:52,922 --> 00:33:53,422
recently

936
00:33:53,734 --> 00:33:56,075
It happened with allowing the Russians to use

937
00:33:56,215 --> 00:33:59,195
the outcome system to target Russian assets

938
00:33:59,575 --> 00:34:01,174
across the border from Car.

939
00:34:02,069 --> 00:34:03,507
And to go after the places where the

940
00:34:03,587 --> 00:34:06,224
Russians were launching assaults on civilian populations. And

941
00:34:06,224 --> 00:34:08,141
just in the last 48 hours, that has

942
00:34:08,141 --> 00:34:10,813
now been expanded to pretty much the entire

943
00:34:11,031 --> 00:34:11,271
front.

944
00:34:11,989 --> 00:34:13,824
Ukraine in the American eyes now can use

945
00:34:13,824 --> 00:34:16,298
our weapon systems to target any place in

946
00:34:16,378 --> 00:34:17,597
Russia that is actively

947
00:34:18,309 --> 00:34:20,802
generating a logistical hub to target

948
00:34:21,259 --> 00:34:22,137
Ukraine proper.

949
00:34:22,775 --> 00:34:24,050
And I would guess that in the next

950
00:34:24,050 --> 00:34:26,523
couple of months, even that limited restriction will

951
00:34:26,523 --> 00:34:27,240
go away as well.

952
00:34:29,009 --> 00:34:30,923
But 1 of these days, 1 of these

953
00:34:30,923 --> 00:34:32,597
red lines might actually be real.

954
00:34:33,155 --> 00:34:35,068
I am guessing here, but I would guess

955
00:34:35,068 --> 00:34:37,159
that it will be when you Ukrainian forces

956
00:34:37,159 --> 00:34:38,677
field they need to cross the border into

957
00:34:38,757 --> 00:34:40,914
Russia proper to physically break it up the

958
00:34:40,914 --> 00:34:43,630
logistical hiccups ups we're not gonna hit that

959
00:34:43,630 --> 00:34:44,190
this year.

960
00:34:45,244 --> 00:34:47,244
But it is something to start stressing about.

961
00:34:47,964 --> 00:34:49,085
Yeah. Another

962
00:34:50,204 --> 00:34:51,724
strategic and important part of the world is

963
00:34:51,804 --> 00:34:52,204
Taiwan.

964
00:34:53,259 --> 00:34:55,971
And there's a a lot of, a reason

965
00:34:55,971 --> 00:34:56,928
why that is

966
00:34:57,566 --> 00:34:58,784
contemplated as,

967
00:34:59,639 --> 00:35:02,112
a risk in the future. And I wonder

968
00:35:02,112 --> 00:35:04,518
that that is conflict with China. And I

969
00:35:04,518 --> 00:35:07,149
wonder to what extent not only what you've

970
00:35:07,149 --> 00:35:08,606
described in terms of the

971
00:35:09,222 --> 00:35:11,788
existential challenges that China has But on top

972
00:35:11,788 --> 00:35:13,941
of it, the... What they are seeing with

973
00:35:13,941 --> 00:35:16,813
the war in Ukraine, to what extent do

974
00:35:16,813 --> 00:35:17,132
you

975
00:35:17,769 --> 00:35:20,402
believe that this is dampened cheese enthusiasm for

976
00:35:20,402 --> 00:35:20,800
conflicts.

977
00:35:21,931 --> 00:35:23,365
It's really hard to get a read on

978
00:35:23,365 --> 00:35:26,414
g because he doesn't have conversations with everybody

979
00:35:26,472 --> 00:35:28,796
with anybody. So, you know, you can tap

980
00:35:28,796 --> 00:35:31,655
phones and hack fax lines and emails in

981
00:35:31,734 --> 00:35:33,085
Rush and get a decent view of what's

982
00:35:33,085 --> 00:35:34,856
going on in the Kremlin, but she has

983
00:35:34,911 --> 00:35:36,262
conversations with no 1. So it's all guest

984
00:35:36,262 --> 00:35:38,424
work. And the fact that his decisions are

985
00:35:38,424 --> 00:35:40,094
not driven by what's going on in the

986
00:35:40,094 --> 00:35:41,924
world. They're just driven by what rare bits

987
00:35:41,924 --> 00:35:43,570
of information get into his head

988
00:35:44,007 --> 00:35:45,916
and then conversations with no 1 about the

989
00:35:45,916 --> 00:35:47,746
details, it... It's kind of a fool errand

990
00:35:47,746 --> 00:35:50,824
to predict. I would just underline that

991
00:35:51,263 --> 00:35:53,813
If there was a war with Taiwan, it

992
00:35:53,813 --> 00:35:55,486
would be the end of China, not that

993
00:35:55,486 --> 00:35:57,000
there wouldn't be fallout, not that there wouldn't

994
00:35:57,000 --> 00:35:59,108
be blood, but it would be the

995
00:35:59,482 --> 00:36:01,309
end of the people's republic.

996
00:36:02,660 --> 00:36:03,137
Also,

997
00:36:04,010 --> 00:36:04,987
even if

998
00:36:05,773 --> 00:36:08,818
in their wildest dreams, that version of Chinese

999
00:36:08,955 --> 00:36:10,864
nationalism happened where they were able to conquer

1000
00:36:10,943 --> 00:36:12,295
Taiwan intact in 2 weeks.

1001
00:36:13,409 --> 00:36:13,909
So

1002
00:36:14,458 --> 00:36:15,815
doesn't solve any of their problems,

1003
00:36:16,213 --> 00:36:18,207
and they can't operate their own semiconductor fab.

1004
00:36:18,447 --> 00:36:21,079
That's... Those are manned by critical staff from

1005
00:36:21,079 --> 00:36:23,631
other countries. You put them in charge of

1006
00:36:23,711 --> 00:36:25,644
Ts see they wouldn't know what to do

1007
00:36:25,644 --> 00:36:28,045
with it. I don't see the gain here,

1008
00:36:28,445 --> 00:36:30,605
aside from a little nationalist drum beating that

1009
00:36:30,605 --> 00:36:32,525
you can then keep beating that drum As

1010
00:36:32,525 --> 00:36:34,777
country cole is around you and maybe use

1011
00:36:34,777 --> 00:36:37,035
that to write the narrative for the next

1012
00:36:37,094 --> 00:36:38,851
iteration of the Chinese government in an era

1013
00:36:38,851 --> 00:36:40,290
of famine and no electricity.

1014
00:36:41,344 --> 00:36:42,704
Doesn't seem like a winning play to me.

1015
00:36:43,184 --> 00:36:44,944
Yeah. That makes sense. Let's turn to the

1016
00:36:45,105 --> 00:36:46,464
United States a little bit more than we

1017
00:36:46,464 --> 00:36:47,424
have so far.

1018
00:36:48,557 --> 00:36:51,028
You've noted, you you alluded earlier to the

1019
00:36:51,028 --> 00:36:53,500
fact that we are a continental economy. And

1020
00:36:53,660 --> 00:36:56,392
I know from from past conversations that you've

1021
00:36:57,182 --> 00:36:59,971
you've talked about the impact of d globalization

1022
00:36:59,971 --> 00:37:02,919
is, therefore not going to be an existential

1023
00:37:02,919 --> 00:37:05,547
problem for the United States, provide your analysis

1024
00:37:05,547 --> 00:37:08,739
there, please. Sure. So remember globalization for us

1025
00:37:08,739 --> 00:37:10,246
was ploy to get everybody on our side.

1026
00:37:10,405 --> 00:37:12,388
And if we had invested our economy into

1027
00:37:12,388 --> 00:37:14,132
the global commons, it wouldn't have been a

1028
00:37:14,132 --> 00:37:16,058
bribe. Wouldn't have been nearly as attractive.

1029
00:37:16,934 --> 00:37:19,643
So today, only about 15 percent of our

1030
00:37:19,802 --> 00:37:21,555
Gdp comes from international trade.

1031
00:37:22,192 --> 00:37:25,391
Roughly half of that is mix and Canada.

1032
00:37:26,107 --> 00:37:29,365
Roughly half of what's left is exports of

1033
00:37:29,365 --> 00:37:30,740
raw commodities like

1034
00:37:31,193 --> 00:37:33,022
crude oil, refined product and grain.

1035
00:37:33,594 --> 00:37:35,508
So now you're talking about a total exposure

1036
00:37:35,508 --> 00:37:37,183
of 3 to 4 percent of Gdp.

1037
00:37:37,582 --> 00:37:40,693
Now that's not nothing, and most of that

1038
00:37:40,693 --> 00:37:43,005
is in the form of manufactured goods.

1039
00:37:44,139 --> 00:37:46,136
So if we were to see a cut

1040
00:37:46,136 --> 00:37:46,955
of everything

1041
00:37:47,494 --> 00:37:50,710
overnight, we would have a glut of finance

1042
00:37:51,184 --> 00:37:53,676
food and energy and a shortage

1043
00:37:54,133 --> 00:37:54,633
in

1044
00:37:55,648 --> 00:37:55,966
electronics.

1045
00:37:57,082 --> 00:37:58,756
That would be how we would basically feel

1046
00:37:58,756 --> 00:37:58,916
it.

1047
00:38:00,363 --> 00:38:02,353
We don't move along from that overnight. We

1048
00:38:02,353 --> 00:38:04,444
don't move on from that without a considerable

1049
00:38:04,820 --> 00:38:06,704
expense, but this isn't a

1050
00:38:07,385 --> 00:38:08,285
civilization ending

1051
00:38:08,825 --> 00:38:10,825
event like it will be in other places.

1052
00:38:11,785 --> 00:38:14,265
I I've been fascinated by your analysis of

1053
00:38:14,265 --> 00:38:16,277
the presidential and we're speaking now in the

1054
00:38:16,277 --> 00:38:17,475
summer boy be 20 growth.

1055
00:38:19,391 --> 00:38:21,068
But I mean, you you you are une.

1056
00:38:21,228 --> 00:38:23,643
You you say this will be a Biden

1057
00:38:23,702 --> 00:38:26,590
win by a land wide. Yeah. To describe

1058
00:38:26,590 --> 00:38:29,780
why that's the case. Okay. So, 3 3

1059
00:38:29,780 --> 00:38:30,817
and a half things.

1060
00:38:31,854 --> 00:38:34,726
Number 1, there's fewer Republicans than Democrats.

1061
00:38:35,219 --> 00:38:37,996
And so the Republicans have always done well

1062
00:38:37,996 --> 00:38:40,378
at the national level because the factions that

1063
00:38:40,378 --> 00:38:42,441
make up the coalition don't fight among themselves.

1064
00:38:43,172 --> 00:38:44,925
Well, Trump has not only started a civil

1065
00:38:44,925 --> 00:38:47,155
war among Republicans he's actually purged some of

1066
00:38:47,155 --> 00:38:48,987
these factions like the business community and the

1067
00:38:49,146 --> 00:38:52,429
National security community, from the coalition altogether. So

1068
00:38:52,429 --> 00:38:55,063
without all the Republicans and locks up, there's

1069
00:38:55,063 --> 00:38:56,101
no chance of a victory.

1070
00:38:56,899 --> 00:38:57,618
Number 2,

1071
00:38:58,336 --> 00:39:00,253
people seem to have forgotten what happened during

1072
00:39:00,253 --> 00:39:00,891
the midterms.

1073
00:39:01,863 --> 00:39:04,399
Donald Trump told independence that their vote doesn't

1074
00:39:04,399 --> 00:39:06,380
matter in the general election, and that's the

1075
00:39:06,380 --> 00:39:08,837
only place. But independents vote matters.

1076
00:39:09,727 --> 00:39:10,842
Trump wants it to be all about the

1077
00:39:10,842 --> 00:39:12,276
primaries because that's where he dominates.

1078
00:39:12,833 --> 00:39:15,541
And so in elections where he put his

1079
00:39:15,541 --> 00:39:17,135
finger on the scale and was, like, a

1080
00:39:17,135 --> 00:39:19,137
really heavily campaign through specific candidates,

1081
00:39:19,850 --> 00:39:21,911
independents showed up and drove to vote against

1082
00:39:21,911 --> 00:39:22,784
those candidates.

1083
00:39:24,052 --> 00:39:25,583
Well, again, if fewer

1084
00:39:26,369 --> 00:39:27,590
Republicans than Democrats.

1085
00:39:28,050 --> 00:39:30,530
The Republicans have never won the presidency without

1086
00:39:30,530 --> 00:39:32,289
capturing 2 thirds of the independent vote.

1087
00:39:33,343 --> 00:39:34,932
They're gonna lose the independent vote. So now

1088
00:39:34,932 --> 00:39:36,204
we're not just talking about it feet. We're

1089
00:39:36,204 --> 00:39:37,158
talking about a route.

1090
00:39:38,191 --> 00:39:38,509
Third,

1091
00:39:40,177 --> 00:39:41,449
or of Kennedy junior.

1092
00:39:42,259 --> 00:39:44,405
Trump thought he had cornered the bat shit

1093
00:39:44,405 --> 00:39:46,948
crazy vote, and now it split. So you're

1094
00:39:46,948 --> 00:39:48,776
talking about a loss of vote even in

1095
00:39:48,776 --> 00:39:49,276
strongholds.

1096
00:39:51,017 --> 00:39:53,324
And this is before he became a convicted

1097
00:39:53,324 --> 00:39:53,642
felon.

1098
00:39:54,279 --> 00:39:57,554
So we're looking at the second or third

1099
00:39:57,554 --> 00:40:00,037
worst electoral defeat for any

1100
00:40:00,411 --> 00:40:02,870
presidential candidate in American history. I mean, this

1101
00:40:02,870 --> 00:40:05,092
is gonna be like gold water or worse.

1102
00:40:06,222 --> 00:40:08,376
Assuming Biden doesn't die. Biden doesn't die I

1103
00:40:08,376 --> 00:40:09,971
reserve or... If Biden die, I reserve the

1104
00:40:09,971 --> 00:40:11,327
right to change my mind but that's where

1105
00:40:11,327 --> 00:40:13,640
we are today. Well, let's let's assume for

1106
00:40:13,640 --> 00:40:15,315
for 1 reason or another that you're incorrect.

1107
00:40:15,568 --> 00:40:17,234
And and Trump wins. What do you see

1108
00:40:17,234 --> 00:40:18,503
is some of the things that he would

1109
00:40:18,503 --> 00:40:19,852
do or perhaps some of the risks of

1110
00:40:19,852 --> 00:40:21,994
a second Trump term. Well, the only thing

1111
00:40:21,994 --> 00:40:24,552
that we know that he would do for

1112
00:40:24,552 --> 00:40:27,423
certain is be as tough on China as

1113
00:40:27,583 --> 00:40:29,757
Biden. Now, they have a very, very similar

1114
00:40:30,055 --> 00:40:32,129
policy when it comes to international economic affairs.

1115
00:40:32,289 --> 00:40:33,405
In fact, I would argue that the 2

1116
00:40:33,405 --> 00:40:35,175
most similar presence we've ever had in that

1117
00:40:35,175 --> 00:40:37,807
regard, coming from different points and a decline

1118
00:40:37,807 --> 00:40:40,540
policy differently, but getting to the same general

1119
00:40:40,599 --> 00:40:41,896
result of basically

1120
00:40:42,353 --> 00:40:43,571
dividing the Chinese

1121
00:40:43,884 --> 00:40:45,083
from the American system.

1122
00:40:45,642 --> 00:40:47,799
And while I could sit back here in

1123
00:40:47,799 --> 00:40:49,717
arm share quarter, quarterback for both of their

1124
00:40:49,717 --> 00:40:51,076
strategy that how like could do it with

1125
00:40:51,076 --> 00:40:52,950
less pain, more more effectiveness.

1126
00:40:54,050 --> 00:40:57,090
Most Americans are broadly on board with that

1127
00:40:57,090 --> 00:40:57,410
push,

1128
00:40:58,130 --> 00:41:00,550
and Trump does deserve credit for starting that

1129
00:41:00,610 --> 00:41:01,898
conversation. But beyond that,

1130
00:41:02,613 --> 00:41:05,554
Trump's policies are basically shaped by whoever flattered

1131
00:41:05,554 --> 00:41:06,587
him most recently.

1132
00:41:07,778 --> 00:41:09,289
And I can't predict that.

1133
00:41:10,019 --> 00:41:11,928
If it happens to be somebody in Mexico,

1134
00:41:12,167 --> 00:41:14,315
then Mexican relations will be great. If it

1135
00:41:14,315 --> 00:41:16,065
happens to be putin then look out Ukraine.

1136
00:41:16,304 --> 00:41:18,134
But if Z Z gets to him first

1137
00:41:18,134 --> 00:41:18,771
look out Russia.

1138
00:41:19,899 --> 00:41:22,921
He's in unpredictable because he has no attention

1139
00:41:22,921 --> 00:41:25,625
span. He ignores the information that is available

1140
00:41:25,625 --> 00:41:27,786
to him. He ignores his advisers mean that

1141
00:41:27,786 --> 00:41:30,508
he doesn't fire them outright. So predicting the

1142
00:41:30,563 --> 00:41:30,960
specifics,

1143
00:41:32,150 --> 00:41:33,840
I can tell you though that the general

1144
00:41:33,896 --> 00:41:34,396
engagement

1145
00:41:34,864 --> 00:41:36,141
through government assets,

1146
00:41:36,620 --> 00:41:38,317
whether it's the military, the bureaucracy,

1147
00:41:39,094 --> 00:41:41,409
the state department, he just doesn't use those

1148
00:41:41,409 --> 00:41:43,245
tools in a way that a normal president

1149
00:41:43,245 --> 00:41:45,018
would. Just makes everything very erratic.

1150
00:41:45,657 --> 00:41:47,654
Mh. If Biden wins, of course, as you

1151
00:41:47,654 --> 00:41:49,753
predict, do you have a sense of any

1152
00:41:49,812 --> 00:41:52,144
changes in direction or or policy,

1153
00:41:53,262 --> 00:41:54,701
modifications when when he will not have any

1154
00:41:54,701 --> 00:41:55,500
more races to run?

1155
00:41:56,379 --> 00:41:58,616
In foreign policy, I would expect it to

1156
00:41:58,616 --> 00:42:02,382
be reasonably steady state. So, again, steady reduction

1157
00:42:02,382 --> 00:42:04,456
in anything that globalization has to do, no

1158
00:42:04,456 --> 00:42:05,255
new trade deals.

1159
00:42:05,972 --> 00:42:08,539
Ever tighter options on the Chinese moving down,

1160
00:42:08,699 --> 00:42:09,358
the technological

1161
00:42:10,852 --> 00:42:12,526
platform from things that the Chinese have no

1162
00:42:12,526 --> 00:42:15,078
chance of doing themselves to things where the

1163
00:42:15,157 --> 00:42:17,408
Chinese are dependent foreign corn supply chains, and

1164
00:42:17,408 --> 00:42:19,485
then only in the later on, things where

1165
00:42:19,485 --> 00:42:21,802
the Chinese depend on foreign markets, basically ratchet

1166
00:42:21,802 --> 00:42:23,240
up the pressure steadily.

1167
00:42:24,369 --> 00:42:26,117
On domestic affairs, it really depends upon what

1168
00:42:26,117 --> 00:42:27,229
happens with the congress.

1169
00:42:28,580 --> 00:42:29,851
I think at this point, it's kind of

1170
00:42:29,851 --> 00:42:31,519
a shoo in that the Democrats are gonna

1171
00:42:31,519 --> 00:42:33,680
win the house. The question is the senate.

1172
00:42:33,918 --> 00:42:36,938
Now normally, and until a month ago, I

1173
00:42:36,938 --> 00:42:39,559
would have said that the Republicans will probably

1174
00:42:39,559 --> 00:42:42,202
hold the majority in the senate There's 33

1175
00:42:42,202 --> 00:42:44,596
seats up. 20 of those are being defended

1176
00:42:44,596 --> 00:42:45,575
by Democrats.

1177
00:42:46,192 --> 00:42:48,268
In order to get a majority, the Democrats

1178
00:42:48,268 --> 00:42:51,075
would have to defend every seat and then

1179
00:42:51,075 --> 00:42:52,373
gets 10

1180
00:42:53,229 --> 00:42:53,729
more

1181
00:42:54,505 --> 00:42:55,702
seats from the Republicans.

1182
00:42:56,260 --> 00:42:58,413
That just doesn't happen. I'm mean Sorry. Not

1183
00:42:58,413 --> 00:42:59,291
majority clot.

1184
00:42:59,863 --> 00:43:01,928
To get 60 60 seats in order to

1185
00:43:01,928 --> 00:43:04,390
basically control things. I would've have said no

1186
00:43:04,390 --> 00:43:04,708
way.

1187
00:43:05,899 --> 00:43:07,250
And then Trump was convicted.

1188
00:43:08,777 --> 00:43:11,010
And so there are going to be negative

1189
00:43:11,010 --> 00:43:13,163
coat tails for Trump in this scenario. The

1190
00:43:13,163 --> 00:43:14,918
question is how big, but I have gone

1191
00:43:14,918 --> 00:43:16,672
in the last month from thinking there was

1192
00:43:16,672 --> 00:43:19,313
no chance. That the Republicans could lose the

1193
00:43:19,313 --> 00:43:20,903
senate to that degree to all a sudden

1194
00:43:20,903 --> 00:43:22,573
like it's within the realm possibility.

1195
00:43:23,289 --> 00:43:25,299
Now if if if

1196
00:43:25,929 --> 00:43:28,507
we have that sort of just dynamic

1197
00:43:29,045 --> 00:43:29,684
blow out.

1198
00:43:30,643 --> 00:43:33,461
Then we're gonna find out just how economically

1199
00:43:34,014 --> 00:43:36,643
liberal and incompetent the Biden team can be.

1200
00:43:37,281 --> 00:43:39,273
I have not been impressed by their domestic

1201
00:43:39,273 --> 00:43:41,997
economic policy. I was not impressed by trump's

1202
00:43:41,997 --> 00:43:45,047
economic policy. I was not impressed by, Obama's

1203
00:43:45,106 --> 00:43:47,417
economic policy. It's been a long time since

1204
00:43:47,417 --> 00:43:48,612
we had someone who could do math in

1205
00:43:48,612 --> 00:43:49,091
the White House.

1206
00:43:50,222 --> 00:43:50,779
Odds are,

1207
00:43:51,655 --> 00:43:54,603
strong presidential result, strong house result, both the

1208
00:43:54,683 --> 00:43:55,183
Democrats

1209
00:43:55,639 --> 00:43:58,362
and then a split senate are probably even

1210
00:43:58,362 --> 00:43:59,876
a Republican majority.

1211
00:44:01,469 --> 00:44:03,858
As long as the Republicans have 50 seats,

1212
00:44:04,416 --> 00:44:04,973
there's a break.

1213
00:44:06,742 --> 00:44:09,057
That's probably where we're going. So clearly, your

1214
00:44:09,057 --> 00:44:10,653
analysis generally speaking,

1215
00:44:11,132 --> 00:44:11,951
based on

1216
00:44:12,409 --> 00:44:14,814
demography based on we can including, you know,

1217
00:44:14,893 --> 00:44:16,164
the the fact that we are surrounded by

1218
00:44:16,164 --> 00:44:17,593
2 oceans here in the Us.

1219
00:44:18,466 --> 00:44:19,681
But based on

1220
00:44:20,134 --> 00:44:22,515
just the the the dynamics in the rest

1221
00:44:22,515 --> 00:44:22,992
of the world,

1222
00:44:24,436 --> 00:44:26,423
the United States is positioned to be the

1223
00:44:26,423 --> 00:44:29,045
big winner in the years decades ahead.

1224
00:44:30,888 --> 00:44:33,033
What capacity do you feel the the government

1225
00:44:33,033 --> 00:44:35,893
has to potentially slow our progress or or,

1226
00:44:37,163 --> 00:44:39,070
you know, be be b the the 1

1227
00:44:39,070 --> 00:44:40,341
thing that gets in the way of that

1228
00:44:40,341 --> 00:44:42,668
outcome. Well, I'm fur in the Beg can't

1229
00:44:42,668 --> 00:44:45,140
be Choose camp. We need to basically double

1230
00:44:45,140 --> 00:44:47,315
our industrial plant to prepare for a post

1231
00:44:47,533 --> 00:44:49,208
globalization world because we won't be able to

1232
00:44:49,208 --> 00:44:51,849
import those finished goods. Or maybe the intermediate

1233
00:44:51,849 --> 00:44:53,836
goods that are important in our own manufacturing.

1234
00:44:56,300 --> 00:44:58,129
With the benefit of Hindsight, I think a

1235
00:44:58,129 --> 00:44:59,972
lot of people realize that we should started

1236
00:44:59,972 --> 00:45:02,278
building this out years ago as opposed to

1237
00:45:02,278 --> 00:45:04,028
relatively recently, but I mean, here's a thing.

1238
00:45:04,664 --> 00:45:05,880
Think of, say the

1239
00:45:06,414 --> 00:45:07,210
inflation reduction act.

1240
00:45:08,338 --> 00:45:10,963
Couple trillion dollars of investment into various green

1241
00:45:10,963 --> 00:45:12,952
tech to build out new industrial plants so

1242
00:45:12,952 --> 00:45:14,145
we can compete in these spaces.

1243
00:45:15,512 --> 00:45:17,020
The economist in me is like, this is

1244
00:45:17,020 --> 00:45:17,520
wildly

1245
00:45:18,052 --> 00:45:18,210
inefficient.

1246
00:45:18,925 --> 00:45:20,988
But we're kind of on the clock.

1247
00:45:21,623 --> 00:45:24,334
And even if we build with subsidies an

1248
00:45:24,334 --> 00:45:26,712
industrial plant that isn't perfect for what we

1249
00:45:26,712 --> 00:45:29,010
need 05:10 years from now. We're still building

1250
00:45:29,010 --> 00:45:31,724
out the electrical systems a physical infrastructure, moving

1251
00:45:31,724 --> 00:45:34,188
the populations that are necessary to have what

1252
00:45:34,188 --> 00:45:35,778
we need at the end. And if we

1253
00:45:35,778 --> 00:45:37,606
have to re tool this stuff between now

1254
00:45:37,606 --> 00:45:38,958
and then fine.

1255
00:45:40,730 --> 00:45:43,289
The efficient time to start this process was

1256
00:45:43,289 --> 00:45:44,010
20 10.

1257
00:45:44,650 --> 00:45:46,569
We started in 20 21.

1258
00:45:48,654 --> 00:45:50,164
I'll take what I can get at this

1259
00:45:50,164 --> 00:45:51,675
point. And even if we're not building the

1260
00:45:51,675 --> 00:45:54,457
perfect thing, we're building something that we can

1261
00:45:54,457 --> 00:45:55,014
then reuse.

1262
00:45:56,619 --> 00:45:57,891
Talk about the role of immigration?

1263
00:45:58,528 --> 00:46:00,300
The countries we've spoken about primarily,

1264
00:46:01,074 --> 00:46:02,824
the only 1 that has a history of

1265
00:46:02,824 --> 00:46:04,273
immigration is the States and in many ways,

1266
00:46:04,512 --> 00:46:06,289
actually, our demo... Demography

1267
00:46:06,746 --> 00:46:09,460
is is is it's the primary benefit. Demographic,

1268
00:46:09,619 --> 00:46:11,636
the fact that we are a young nation

1269
00:46:11,789 --> 00:46:13,630
in many cases because of immigration.

1270
00:46:14,750 --> 00:46:17,309
Talk about the role that that plays as

1271
00:46:17,309 --> 00:46:18,449
a potential

1272
00:46:19,230 --> 00:46:21,204
force multiplier to the advantage of the United

1273
00:46:21,244 --> 00:46:22,516
states relative to some of the other countries

1274
00:46:22,516 --> 00:46:24,264
you're doing. Yeah. The issue is for immigration

1275
00:46:24,264 --> 00:46:26,171
to be a meaningful part of the solution

1276
00:46:26,171 --> 00:46:27,522
is it has... It has to be something

1277
00:46:27,522 --> 00:46:29,287
that has deep roots and you have to

1278
00:46:29,287 --> 00:46:30,744
have a society that can regularly

1279
00:46:31,121 --> 00:46:33,911
assimilate relatively large numbers of people without changing

1280
00:46:33,911 --> 00:46:34,650
the core,

1281
00:46:35,585 --> 00:46:37,674
identity of the country to point that it

1282
00:46:37,674 --> 00:46:39,032
triggers a backlash. Now in the United States

1283
00:46:39,032 --> 00:46:40,311
here, we're kind of on sign curve. We

1284
00:46:40,311 --> 00:46:41,749
have Highs and lows. And right now, we're

1285
00:46:41,749 --> 00:46:42,548
definitely at a low,

1286
00:46:43,267 --> 00:46:47,192
Trump basically criminal all legal route something that

1287
00:46:47,192 --> 00:46:49,899
biden doubled down on, which he should get

1288
00:46:49,899 --> 00:46:52,687
full credit for that or full blame based

1289
00:46:52,687 --> 00:46:53,563
on where you are.

1290
00:46:55,094 --> 00:46:56,534
Which means that the only way to come

1291
00:46:56,534 --> 00:46:57,815
into the United States now is should come

1292
00:46:57,815 --> 00:46:59,655
in illegally. And that's why we're seeing a

1293
00:46:59,655 --> 00:47:01,655
surge of people from Russians from India from

1294
00:47:01,734 --> 00:47:03,588
China to Southern border because close off all

1295
00:47:03,588 --> 00:47:05,581
the normal wet ways that they would have

1296
00:47:05,581 --> 00:47:07,655
used to get here. I will point out

1297
00:47:07,655 --> 00:47:09,728
that we brought in about 2000000 people illegally

1298
00:47:09,728 --> 00:47:11,643
last year. And if it not for those

1299
00:47:11,643 --> 00:47:13,726
people going into the work force our inflation

1300
00:47:13,726 --> 00:47:15,472
problem would be much higher than it is

1301
00:47:15,472 --> 00:47:17,218
right now, at least double, probably triple.

1302
00:47:17,932 --> 00:47:20,076
Until such time as our political systems settle.

1303
00:47:20,965 --> 00:47:22,078
I don't think we're gonna be able to

1304
00:47:22,078 --> 00:47:24,145
have a meaningful conversation about immigration in the

1305
00:47:24,304 --> 00:47:26,451
United States, which means we won't probably have

1306
00:47:26,451 --> 00:47:28,064
a change in our current structure

1307
00:47:29,166 --> 00:47:29,800
for 5 years.

1308
00:47:31,068 --> 00:47:33,603
It's a missed opportunity because as we see

1309
00:47:33,603 --> 00:47:35,109
countries fall apart around the world,

1310
00:47:35,996 --> 00:47:37,821
Now is the time to be setting up

1311
00:47:37,821 --> 00:47:39,884
the policy so you can hoover up that

1312
00:47:39,884 --> 00:47:41,629
labor in those skilled workforce,

1313
00:47:42,105 --> 00:47:43,375
and we're not gonna be able to benefit

1314
00:47:43,375 --> 00:47:43,692
from that.

1315
00:47:44,502 --> 00:47:45,615
Not a lot of places are.

1316
00:47:46,411 --> 00:47:48,559
Really the only country I would argue that

1317
00:47:48,559 --> 00:47:50,229
has kind of made immigration kind of a

1318
00:47:50,229 --> 00:47:51,979
day in day out part of their systems

1319
00:47:52,139 --> 00:47:52,536
Canada,

1320
00:47:53,110 --> 00:47:56,090
But even they are experiencing some significant ba

1321
00:47:56,550 --> 00:47:58,630
because when you bring in a large number

1322
00:47:58,630 --> 00:48:00,630
of people year on year on year for

1323
00:48:00,630 --> 00:48:01,110
15 years,

1324
00:48:01,762 --> 00:48:04,227
they all need homes and they're relatively price

1325
00:48:04,227 --> 00:48:05,817
sensitive when they go looking for them because

1326
00:48:05,817 --> 00:48:07,725
you have to have 1. And so there's

1327
00:48:07,725 --> 00:48:09,713
now an affordability crisis in most of the

1328
00:48:09,713 --> 00:48:10,826
major metro in Canada,

1329
00:48:11,318 --> 00:48:12,746
With most of the people who were born

1330
00:48:12,746 --> 00:48:14,492
in Canada no longer being able to afford

1331
00:48:14,492 --> 00:48:15,048
a house.

1332
00:48:15,682 --> 00:48:17,270
It's a different sort of problem.

1333
00:48:17,826 --> 00:48:19,492
It's not a perceived as a crime issue,

1334
00:48:19,651 --> 00:48:21,739
it's perceived as a cost of living issue.

1335
00:48:22,458 --> 00:48:25,330
So the smart play now would be to

1336
00:48:25,330 --> 00:48:27,485
have a degree of immigration reform that doesn't

1337
00:48:27,485 --> 00:48:30,050
just tough up the border, but opens up

1338
00:48:30,050 --> 00:48:32,542
new avenues for people to come in legally,

1339
00:48:33,237 --> 00:48:34,990
but until we can have that conversation.

1340
00:48:35,722 --> 00:48:37,393
Immigration is not part of the solution in

1341
00:48:37,393 --> 00:48:39,461
a traditional sense. We might be able to

1342
00:48:39,461 --> 00:48:39,779
bring in,

1343
00:48:40,574 --> 00:48:43,518
bring in, run toward probably. A lot of

1344
00:48:43,518 --> 00:48:45,067
illegal to do work

1345
00:48:45,442 --> 00:48:47,668
to keep inflation under control, but that's about

1346
00:48:47,668 --> 00:48:47,906
it.

1347
00:48:49,099 --> 00:48:51,325
We're missing out on what should be right

1348
00:48:51,325 --> 00:48:54,443
now the greatest skills transfer in modern history?

1349
00:48:56,513 --> 00:48:59,139
What other countries are you bullish on in

1350
00:48:59,139 --> 00:49:01,288
terms of long term prospects beyond the United

1351
00:49:01,447 --> 00:49:01,607
States?

1352
00:49:02,338 --> 00:49:03,850
Well, the first 1 is 1 that from

1353
00:49:03,850 --> 00:49:05,680
a demographic point of view looks like a

1354
00:49:05,680 --> 00:49:07,590
no brainer for being a failure in that'd

1355
00:49:07,590 --> 00:49:08,067
be Japan.

1356
00:49:08,784 --> 00:49:09,522
It's the oldest

1357
00:49:09,994 --> 00:49:12,072
demographic structure in the world, they have managed

1358
00:49:12,072 --> 00:49:13,430
to bring the birth rate back up or

1359
00:49:13,430 --> 00:49:14,629
at least re target's reduction.

1360
00:49:15,428 --> 00:49:17,505
But under Trump, they were able to cut

1361
00:49:17,505 --> 00:49:20,223
a trade deal that was humiliating, which almost

1362
00:49:20,223 --> 00:49:22,125
brought them into the American inner circle of

1363
00:49:22,125 --> 00:49:24,581
allies, and there's basically doubling and tripling down

1364
00:49:24,581 --> 00:49:26,583
on that right now. So they found a

1365
00:49:26,583 --> 00:49:28,019
way to get access to Us market over

1366
00:49:28,019 --> 00:49:28,578
the long term,

1367
00:49:29,296 --> 00:49:30,972
and a merger of security interest over the

1368
00:49:30,972 --> 00:49:32,328
long term, but I think we'll do them

1369
00:49:32,328 --> 00:49:33,605
very very well.

1370
00:49:34,338 --> 00:49:36,249
I'm also very bullish on Mexico.

1371
00:49:37,045 --> 00:49:38,421
If it wasn't for Americans

1372
00:49:39,036 --> 00:49:40,709
obsession with cocaine, this should be 1 of

1373
00:49:40,709 --> 00:49:42,541
the most successful states in the world.

1374
00:49:43,114 --> 00:49:46,550
And their demographic structure perfectly complements ours. They're

1375
00:49:46,550 --> 00:49:48,308
already on the verge of having a trillion

1376
00:49:48,308 --> 00:49:49,847
dollar consumer market

1377
00:49:50,306 --> 00:49:52,234
because of their structure. So it's not just

1378
00:49:52,234 --> 00:49:54,962
a source of manufacturing for us. It's also

1379
00:49:55,177 --> 00:49:57,882
an export partner, which is very, very important.

1380
00:49:58,852 --> 00:50:01,159
Southeast Asia, looks very good for similar reasons

1381
00:50:01,159 --> 00:50:02,114
and has less cocaine.

1382
00:50:02,910 --> 00:50:03,945
Young population,

1383
00:50:04,661 --> 00:50:07,540
multifaceted manufacturing system. And it's as a region,

1384
00:50:07,938 --> 00:50:09,768
probably the part of the world that will

1385
00:50:09,768 --> 00:50:11,144
benefit the most from

1386
00:50:11,838 --> 00:50:14,463
industry moving out of the people's republic. They're

1387
00:50:14,463 --> 00:50:16,706
at a similar state... They've several states that

1388
00:50:16,706 --> 00:50:18,694
are at a similar stage of economic development

1389
00:50:18,694 --> 00:50:20,944
that are actually far more economically efficient

1390
00:50:21,558 --> 00:50:21,876
already.

1391
00:50:22,689 --> 00:50:24,707
And there aren't a lot of local

1392
00:50:25,806 --> 00:50:26,306
military

1393
00:50:26,844 --> 00:50:29,162
competitions that are a serious problem. So you

1394
00:50:29,162 --> 00:50:31,813
can end globalization on a global level. Still

1395
00:50:31,813 --> 00:50:35,001
have a regional globalized system within Southeast Asia

1396
00:50:35,001 --> 00:50:36,436
that can then trade with Japan and the

1397
00:50:36,515 --> 00:50:36,994
United States.

1398
00:50:37,711 --> 00:50:38,588
Those are my big 3.

1399
00:50:39,719 --> 00:50:41,159
Would talked about a number of countries that

1400
00:50:41,159 --> 00:50:43,480
are on negative trajectories that you believe can't

1401
00:50:43,480 --> 00:50:45,659
be corrected. Are there any that have negative

1402
00:50:45,719 --> 00:50:47,559
trajectories that can? And if so, what are

1403
00:50:47,559 --> 00:50:49,414
the actions they you do? I mean, I'll

1404
00:50:49,414 --> 00:50:51,652
never sell short the Koreans because they keep

1405
00:50:51,652 --> 00:50:53,650
rewriting the rules of physics to make things

1406
00:50:53,650 --> 00:50:55,887
happen. But, I mean, their demographics are, like

1407
00:50:55,887 --> 00:50:57,565
the second or third worst in the world.

1408
00:50:59,413 --> 00:51:02,139
I'm interested in Poland right now. Poland

1409
00:51:02,513 --> 00:51:05,295
today is kind of like Mexico. Poland versus

1410
00:51:05,454 --> 00:51:06,805
Germany is a little bit like Mexico versus

1411
00:51:06,805 --> 00:51:07,441
the United States.

1412
00:51:08,974 --> 00:51:10,574
But whereas a, a lot of the other

1413
00:51:10,655 --> 00:51:11,855
European countries have aged out,

1414
00:51:12,574 --> 00:51:14,414
the polls still have a lot of people

1415
00:51:14,414 --> 00:51:15,855
aged roughly 30 to 50,

1416
00:51:16,349 --> 00:51:18,017
and if they can build out a pro

1417
00:51:18,017 --> 00:51:21,036
family nat list policy system, the idea that

1418
00:51:21,036 --> 00:51:22,862
they could regenerate their population over the next

1419
00:51:22,862 --> 00:51:24,452
20 years is it's not beyond the pale.

1420
00:51:24,944 --> 00:51:26,463
But if they don't do it soon if

1421
00:51:26,463 --> 00:51:27,901
they're gonna run out of time, they'll have

1422
00:51:27,901 --> 00:51:30,378
a moment. When Germany has failed, when Russia

1423
00:51:30,378 --> 00:51:31,976
has failed and they're like the guiding star

1424
00:51:31,976 --> 00:51:32,935
of Europe at that point.

1425
00:51:33,746 --> 00:51:35,815
But it's only a moment unless they can

1426
00:51:35,815 --> 00:51:39,179
get their demographics back up, watch turkey, positive

1427
00:51:39,235 --> 00:51:42,117
demographics. Again, to like that Mexico, Us sort

1428
00:51:42,117 --> 00:51:43,789
of thing between Turkey and Europe,

1429
00:51:45,382 --> 00:51:45,701
France,

1430
00:51:46,497 --> 00:51:48,329
healthiest demography in the rich world outside of

1431
00:51:48,329 --> 00:51:49,126
the United States.

1432
00:51:49,936 --> 00:51:51,948
They've got some issues to work out, but

1433
00:51:52,164 --> 00:51:54,391
unlike Germany or the United States, they never

1434
00:51:54,391 --> 00:51:55,902
spread out their manufacturing system.

1435
00:51:56,634 --> 00:51:58,389
It's not as efficient as a result and

1436
00:51:58,389 --> 00:51:59,824
they've kind of missed out on a growth

1437
00:51:59,824 --> 00:52:01,420
boom these last 30, 40 years.

1438
00:52:02,057 --> 00:52:05,407
But as globalization fades away, they actually don't

1439
00:52:05,407 --> 00:52:07,255
have to re tool much. Take advantage of

1440
00:52:07,255 --> 00:52:08,925
the world and the form it's going to

1441
00:52:08,925 --> 00:52:09,244
be in.

1442
00:52:10,358 --> 00:52:12,028
About the Uk, that all the data seems

1443
00:52:12,028 --> 00:52:14,510
to suggest that there's now a pretty strong

1444
00:52:14,510 --> 00:52:16,341
majority that feel that Brexit was a mistake.

1445
00:52:16,580 --> 00:52:18,570
Many any chances in your mind that there

1446
00:52:18,570 --> 00:52:20,480
would be, I'm never gonna tell a country

1447
00:52:20,480 --> 00:52:22,174
what to do when it comes to international

1448
00:52:22,231 --> 00:52:24,472
organization membership because there's too many pieces in

1449
00:52:24,472 --> 00:52:27,170
play. Now when when Brexit was first brought

1450
00:52:27,170 --> 00:52:28,201
up, or was it 10 years Ago I

1451
00:52:28,201 --> 00:52:29,233
was like, why no, I can see the

1452
00:52:29,233 --> 00:52:31,082
point of that? Because without

1453
00:52:31,534 --> 00:52:31,693
globalization,

1454
00:52:32,502 --> 00:52:33,692
the Eu has no chance,

1455
00:52:34,248 --> 00:52:36,073
especially once you think that the Germans who

1456
00:52:36,073 --> 00:52:37,739
pay for everything or aging out and aren't

1457
00:52:37,739 --> 00:52:39,485
gonna be able to pay for everything. So

1458
00:52:39,485 --> 00:52:40,438
getting out ahead of it,

1459
00:52:41,247 --> 00:52:43,715
figuring out what's next. That made some sense

1460
00:52:43,715 --> 00:52:44,033
to me.

1461
00:52:44,909 --> 00:52:46,978
It's been 7 years since the Brexit vote

1462
00:52:46,978 --> 00:52:48,410
and the Brits had done nothing.

1463
00:52:49,143 --> 00:52:51,615
And they basically wasted the last decade. And

1464
00:52:51,615 --> 00:52:54,087
now their demographic problems are starting to bite.

1465
00:52:54,485 --> 00:52:56,878
Now, they're not nearly as bad as Italy's

1466
00:52:56,878 --> 00:52:59,610
or Germany's or Russia's China's, but they are

1467
00:52:59,610 --> 00:53:00,090
serious.

1468
00:53:00,890 --> 00:53:02,809
What the brits need to do is make

1469
00:53:02,809 --> 00:53:04,989
up their goddamn damn mind and what Brexit

1470
00:53:05,210 --> 00:53:05,710
actually

1471
00:53:06,424 --> 00:53:06,902
means.

1472
00:53:07,621 --> 00:53:09,456
And it's too late now to go back

1473
00:53:09,456 --> 00:53:11,132
into the Eu and try to salvage it.

1474
00:53:11,451 --> 00:53:13,866
So they do need a third way

1475
00:53:15,615 --> 00:53:17,929
The only way that I can see that

1476
00:53:17,929 --> 00:53:20,322
that works now is to basically get into

1477
00:53:20,402 --> 00:53:20,902
Nafta

1478
00:53:21,453 --> 00:53:23,523
And if they decide to do that, the

1479
00:53:23,682 --> 00:53:25,694
United States will brow beat

1480
00:53:26,149 --> 00:53:28,989
a number of concessions into the agreement

1481
00:53:29,429 --> 00:53:31,269
that the brits really don't wanna agree. They

1482
00:53:31,269 --> 00:53:32,789
will never have as good a deal as

1483
00:53:32,789 --> 00:53:34,309
they head with the European Union. If think

1484
00:53:34,309 --> 00:53:35,190
go with the United States.

1485
00:53:35,829 --> 00:53:38,525
But there isn't a sufficiently large source of

1486
00:53:38,804 --> 00:53:41,355
consumption anywhere else within reach if it's the

1487
00:53:41,515 --> 00:53:43,987
United States or you become a failed middle

1488
00:53:43,987 --> 00:53:44,306
power.

1489
00:53:45,262 --> 00:53:46,777
None of these are good solutions for the

1490
00:53:46,858 --> 00:53:47,358
British.

1491
00:53:48,626 --> 00:53:51,335
So so humiliation like Japan, but but with

1492
00:53:51,335 --> 00:53:54,603
longer term positive implications of of of of

1493
00:53:54,603 --> 00:53:55,103
bending.

1494
00:53:55,574 --> 00:53:57,409
Exactly. I mean, the world has changed and

1495
00:53:57,409 --> 00:53:59,324
it's changing in a direction that is not

1496
00:53:59,324 --> 00:54:02,196
favorable for what the brits have normally been

1497
00:54:02,196 --> 00:54:03,963
good at. So they're gonna have to take

1498
00:54:03,963 --> 00:54:06,271
a deal that they don't want or they

1499
00:54:06,271 --> 00:54:07,885
have to go it completely alone

1500
00:54:08,898 --> 00:54:09,398
and

1501
00:54:10,012 --> 00:54:11,524
that doesn't look nearly as frankly.

1502
00:54:12,653 --> 00:54:14,563
Who who do you see as America's primary

1503
00:54:14,563 --> 00:54:16,075
rival as the century rolls on?

1504
00:54:17,507 --> 00:54:19,577
I I think we're gonna take about 20

1505
00:54:19,577 --> 00:54:21,567
years off from even having that conversation.

1506
00:54:22,857 --> 00:54:24,293
We have to figure out when I say

1507
00:54:24,373 --> 00:54:26,048
We Human humanity has to figure out what

1508
00:54:26,048 --> 00:54:28,144
the economic model is for post globalized

1509
00:54:28,601 --> 00:54:31,255
post demographic collapse world and until we know

1510
00:54:31,255 --> 00:54:32,215
what that is,

1511
00:54:32,934 --> 00:54:34,315
and we haven't really started

1512
00:54:34,775 --> 00:54:37,894
that yet. We can't imagine what the geography

1513
00:54:37,894 --> 00:54:40,147
of excess for that new model is going

1514
00:54:40,147 --> 00:54:41,985
to be. Because whatever it is. It can't

1515
00:54:41,985 --> 00:54:44,142
be based on consumption, production or investment.

1516
00:54:44,862 --> 00:54:46,161
Those are the 3 pillars

1517
00:54:47,274 --> 00:54:49,831
Well, consumption, production investment in labor. Those are

1518
00:54:49,831 --> 00:54:51,589
the 4 pillars of all economic models in

1519
00:54:51,589 --> 00:54:53,187
the world today, and they're not gonna be

1520
00:54:53,187 --> 00:54:54,945
relevant in 20 years on a global basis.

1521
00:54:55,358 --> 00:54:56,628
So until we figure out what that new

1522
00:54:56,628 --> 00:54:57,978
model is, I have no idea.

1523
00:54:59,407 --> 00:55:01,312
Peter Zion, thank you so much for joining

1524
00:55:01,312 --> 00:55:02,424
me. Again today,

1525
00:55:03,138 --> 00:55:05,380
always a pleasure to access to your insights,

1526
00:55:05,859 --> 00:55:07,453
and to spend a little time with you

1527
00:55:07,532 --> 00:55:09,047
I'm grateful for him. My pleasure.