Peter Zeihan

For the past decade, Peter has been discussing the nature, strength and weaknesses of the international system. How post-World War II institutions, geography and demographics have made our world our world…and how it was never going to last. Well, we are now at that world’s end. Any number of factors – the Ukraine War, the fall of China and Germany, energy breakdowns, supply chain collapses, workforce shrivelings, financial contractions, and so on – would independently be sufficient to break the international economy. And they are all happening at once. We were always going to get here, and here we are. So let’s discuss what happens next.

Manufacturing is an endlessly specialized and complicated venture, with most manufacturers directly or indirectly sourcing components from around the country and world. But what if the ability to sail components from site to site becomes compromised? What if capital availability proves insufficient to update industrial bases as technology evolves? The successful manufacturers of the future will be those who can command access to raw materials, capital, labor and markets – within defined areas of proximity. Such days are nearly upon us. Differences in COVID recovery and demographic structures are intermingling with failing Chinese relationships to push manufacturing in an entirely new direction.

Three pillars support modern China’s success: global trade, internal political unity, and easy money. With those three pillars, China has managed to shake 2000 years of war and occupation and remake itself as one of the world’s most powerful countries. Yet none of these three pillars can stand without American assistance, and that cooperation is ending. China’s “inevitable” rise isn’t simply over, it is about to go into screeching, unrelenting, dismembering reverse. But that’s hardly the end of history. When a country falls — particularly the world’s top manufacturing power — the ripples affect countries and industries near and far. Learn who benefits and who loses in a world without China.

Modern agricultural patterns are the result of three largely unrelated factors: low-risk global trade, insatiable Asian demand, and unlimited cheap credit. Within the next five years, all three of these trends will not just evaporate, but invert. When that happens, the only thing that will hurt more than the gradual loss of demand will be the sudden collapse of supply. However, none of this impacts the American producer – it therefore will be the United States that will reap the benefits of its productivity and stability for decades to come.

The global energy sector is as complicated and opaque as it is omnipresent and essential, and it has adapted to not simply the changes in the global economic system, but the global political system. Countries that were weak to nonexistent in ages past now are major players in global energy markets, both as producers and consumers. The system that has allowed this evolution now is under fire, and soon the stability that has enabled the energy sector to create its global webwork will end. What will follow will be a world both more chaotic and poorer, one in which the process of finding, producing, transporting and refining energy will simply be beyond the military and financial capacity of most players. Only the largest, smartest and richest entities will be able to maintain – much less expand – their networks. Far from its final days, the era of the supermajor has not yet begun.