Learn. Share. Evolve…

0:00:02 Support for Prop 3 comes from Viore.
0:00:04 Oh my God, true story.
0:00:09 I am wearing, totally coincidentally, guess what, Viore shorts.
0:00:14 Viore’s high quality gym clothes are made to be versatile and stand the test of time.
0:00:17 They sent me some to try out and here I am.
0:00:21 For our listeners, Viore is offering 20% off your first purchase.
0:00:26 Plus, you have free shipping on any US orders over $75 in free returns.
0:00:30 Get yourself some of the most comfortable and versatile clothing on the planet, viore.com
0:00:31 slash Prop G.
0:00:35 That’s V-U-O-R-I dot com slash Prop G.
0:00:37 Exclusions apply.
0:00:40 Visit the website for full terms and conditions.
0:00:47 We have a favor to ask you.
0:00:51 The Prop G pod team is planning for the future of the show and we want our listeners to be
0:00:52 a part of the conversation.
0:00:56 That’s why we’re hoping you’ll help us by filling out a brief survey.
0:00:58 Your feedback will help us figure out what’s working, what’s not.
0:01:02 Please visit us at VoxMedia.com slash survey.
0:01:06 Again, that’s VoxMedia.com slash survey to provide us with feedback.
0:01:11 We do take it seriously if we’re thinking about new product extensions and want to know what
0:01:11 we can do better.
0:01:13 More dick jokes.
0:01:14 More dick jokes.
0:01:15 Red your mind.
0:01:21 Support for the show comes from Mercury, the fintech that more than 200,000 entrepreneurs
0:01:22 use to simplify their finances.
0:01:25 When banking can do more, your business can do more.
0:01:29 With Mercury, you can watch your revenue climb with every invoice you send.
0:01:31 You can stay current with contractors with built-in bill pay.
0:01:34 You can unlock the credit you need to scale faster.
0:01:37 Check it out for yourself at Mercury.com.
0:01:39 Mercury, banking that does more.
0:01:47 So 351, 351 is your A code covering Northeastern Massachusetts.
0:01:52 In 1951, the United States passed the 22nd Amendment limiting presidents to two terms.
0:01:56 In other news, Taylor Swift has purchased back her entire catalog.
0:01:58 So just some quick data here.
0:02:04 Taylor Swift has about 300 songs about men breaking up with her and zero songs about giving a good
0:02:04 blowjob.
0:02:06 You do the math.
0:02:25 Welcome to the 351st episode of the Prop G Pod.
0:02:29 I’m at that point in my life where I’ve become a bit self-destructive and I’m looking to offend
0:02:30 people.
0:02:32 Anyway, I’m here at the Diplomat.
0:02:33 What’s the Diplomat?
0:02:39 It’s a fairly, I’d call it a four-star, that’s being generous, hotel in Hollywood, Florida,
0:02:41 where I spoke this morning to Nielsen IQ.
0:02:45 And then my plane has been delayed three hours, so I immediately offered the tech team a hundred
0:02:48 bucks to find me a Mac computer laptop.
0:02:51 And I am here recording a podcast in this very glamorous room.
0:02:53 It’s got an ocean view, which is pretty nice.
0:02:57 Although it’s been kind of 85 degrees and storming.
0:02:59 It is hurricane weather here now.
0:03:02 By the way, folks, Florida, check the weather before you come here.
0:03:05 It loses about 110% of its charm when it’s not nice out.
0:03:08 It’s just kind of the South minus the charm when the weather isn’t good here.
0:03:12 But here I am, here I am at the Diplomat Hotel, just spoke, and then I’ll head to the airport,
0:03:15 I’ll go to New York, then I go to Detroit for Summit, which I’m excited about.
0:03:18 I’ve been to Detroit in 17 years.
0:03:22 I went there in 2008 during the crisis to meet with a bankrupt General Motors.
0:03:23 What was I doing there?
0:03:23 I don’t know.
0:03:24 They were interested in digital IQ.
0:03:25 Why was I there?
0:03:26 Why was I there?
0:03:27 I don’t know.
0:03:29 But I remember thinking this is a pretty depressing place.
0:03:30 Although supposedly it’s making a comeback.
0:03:32 Supposedly it’s making a comeback.
0:03:36 Dan Gilbert is renovated or rejuvenated downtown and a lot of people, young people are moving
0:03:37 in.
0:03:41 I’m excited to go there and see what the sitch is, see what the situation is.
0:03:43 And Detroit, Detroit.
0:03:50 Anyways, anyways, with that, with that, I’m excited about our guest, Peter Zion, the geopolitical
0:03:55 analyst who makes a series of provocative predictions, many of which are wrong.
0:03:59 But hey, as someone who gets it wrong a lot, I like that he kind of inspires a really interesting
0:04:00 conversation.
0:04:02 We’ve been trying to get this guy on the pod for a good year now.
0:04:04 He’s sort of a internet celebrity.
0:04:05 I celebrity.
0:04:06 There you go.
0:04:11 We discussed with Peter China’s looming collapse, the future of the U.S.-led global order.
0:04:14 And those are both pretty big assumptions.
0:04:16 I don’t know if our producer has drank the Kool-Aid.
0:04:18 I wonder if she was talking to Peter for too long before she wrote the script here.
0:04:22 And whether AI and automation could reshape geopolitics.
0:04:27 Anyways, with that, with that, from the Diplomat Hotel in Hollywood, Florida, here’s our conversation
0:04:29 with Peter Zion.
0:04:37 Peter, where does this podcast find you?
0:04:39 I am at home, just above Denver.
0:04:41 By the way, thanks for being here.
0:04:43 We’ve wanted you on for a while.
0:04:46 You’ve been vocal about China’s impending collapse.
0:04:48 Why do you believe that?
0:04:53 How do you, what are the dynamics that are setting up for China’s collapse?
0:04:57 Well, let me give you the two big ones, and there’s a lot of small ones.
0:05:00 Number one, this is the most trade-dependent country in human history.
0:05:05 They import 75% to 80% of their energy.
0:05:08 They import 80% of the stuff that allows them to grow their own food.
0:05:09 They are the world’s largest importer of food.
0:05:12 They import all the raw commodities they need to make their manufactured products.
0:05:15 And then they export most of those manufactured products.
0:05:20 So if something happens to trade for any reason, they’re the first ones to go and the ones
0:05:20 that fall hardest.
0:05:27 That is something that theoretically could be managed with a good diplomatic core, which
0:05:28 I might add they don’t have.
0:05:31 But the other problem is demographic.
0:05:36 When you industrialize and you move from the farm to the city, your birth rate drops because
0:05:42 kids go from being a free source of labor to simply a cost.
0:05:47 And China industrialized and urbanized more quickly than any country in human history.
0:05:50 And on top of that, they had the one-child policy.
0:06:00 So from the point that the process really got going in the 70s to 1990, their birth rate
0:06:03 dropped by two-thirds and fell below the American birth rate.
0:06:05 And it’s only dropped since then.
0:06:09 And today, all of the major cities have birth rates that are less than one quarter of replacement
0:06:10 level.
0:06:13 So the American birth rate is now more than triple that of China.
0:06:18 It’s been going for so long that they now have more people aged over 53 than under.
0:06:21 And within the next few years, they simply won’t have a consumption base.
0:06:26 It’s a workforce, a tax base, or consumers at all.
0:06:30 Yeah, one of the things, there’s a lot of catastrophizing trying to justify investments
0:06:34 for bringing onshore and U.S. manufacturing that we couldn’t survive in a shooting war with
0:06:35 China.
0:06:38 But I think I read somewhere that China’s out of business if you manage to cut off their
0:06:43 energy supply, that they’re actually quite vulnerable to any sort of external conflict.
0:06:43 Your thoughts?
0:06:48 I would argue that if there’s any meaningful conflict in China, we don’t simply have a
0:06:52 break of the Chinese military, which, by the way, doesn’t have range.
0:06:56 So for them to beat us in a shooting war, we have to go to them.
0:07:00 If we want to destroy them, we just need a few destroyers in the Indian Ocean Basin to interfere
0:07:01 with shipping.
0:07:02 And that’s it.
0:07:02 It’s over.
0:07:09 We’re actually looking at the disassociation of China as a unified industrialized nation state
0:07:10 within the decade.
0:07:14 And before Trump came in, I would have said that it would probably have been about eight
0:07:14 years.
0:07:18 If we take a much more aggressive position on trade, it’s going to be a lot less.
0:07:20 That doesn’t mean we won’t feel it.
0:07:25 You don’t remove the world’s largest industrial base from the math and not feel it.
0:07:28 But for us, it’s something we can grow through.
0:07:32 For them, we are literally looking at the end of the Han ethnicity this century.
0:07:38 Just to steel man this, isn’t potentially the tariffs in America sort of tearing up the
0:07:43 post-war alliances and a lot of nations, I think, no longer looking at us as a reliable
0:07:43 partner.
0:07:48 Don’t you think there’s an opportunity for China in terms of new trade agreements or I just
0:07:52 thought for the first time that more people globally see China as a force of good than
0:07:52 the U.S.?
0:07:55 Isn’t this potentially an opportunity for China for new markets?
0:07:59 As a rule, I ignore what people say and look at what they do.
0:08:05 This isn’t the first time that American politics have made us less popular around the world.
0:08:09 And I’m not willing to suggest that there aren’t some short-term opportunities here.
0:08:14 But the bottom line is that China doesn’t have enough people under age 50 to consume.
0:08:17 And so the product has to go somewhere.
0:08:19 It just gets dumped in other markets.
0:08:25 And as we have seen with the EV issue in 2024, as soon as the United States put on
0:08:31 tariffs to block EVs from swarming into the American markets, everyone else did some version of
0:08:33 the same if they had any sort of auto industry.
0:08:36 So what we’re seeing right now is the first stages of that.
0:08:38 The Chinese are losing access to the American market.
0:08:39 They’re trying to dump everything everywhere else.
0:08:44 And we’re now starting to see those secondary waves of tariffs forming.
0:08:48 So it’s a nice thought, but I wouldn’t put too much stock in it in the long term.
0:08:52 They must be playing with the ultimate poker face though, because my sense is they basically
0:08:53 told Trump to pound sand.
0:08:58 And if they were as vulnerable as your data suggests, don’t you think they’d be more amenable
0:08:59 to some sort of big, beautiful deal?
0:09:01 A couple of thoughts of that.
0:09:06 Number one, this always had a limited runway.
0:09:12 And so any deal that they were able to strike, say today, they’d still collapse within the
0:09:12 decade.
0:09:17 So is there a deal that would allow them to persist throughout that time without losing
0:09:18 their sense of self?
0:09:19 I’m not sure that’s true anymore.
0:09:21 It might’ve been 10 years ago, but not now.
0:09:25 Second, it’s unclear to me how much Xi is actually aware.
0:09:31 He has so purged the system, most notably the bureaucracy, that the bureaucracy no longer even
0:09:36 collects data that they think might result in numbers that Xi doesn’t want to hear.
0:09:37 So they just don’t collect it at all.
0:09:43 So the idea that Xi has a deep understanding of the reality of the world or even his own country
0:09:45 now, that’s flawed.
0:09:46 It’s just not true.
0:09:52 The new book by, I think it’s Patrick McGee talking about Apple essentially upwinds.
0:09:58 upskilling China and as a result, creating a pretty robust advanced manufacturing capability
0:10:03 in China and Tesla, you could argue doing maybe the same thing, that some of that is
0:10:04 leaked to BYD.
0:10:09 It strikes me that they have built this incredible supply chain.
0:10:11 You don’t think that pulls them out.
0:10:13 You don’t think that’s their saving grace.
0:10:17 No, I mean, that certainly helps, but we’re not at a point where tech transfer would help
0:10:17 here.
0:10:18 I mean, if you don’t have workers, you don’t have workers.
0:10:19 It really is that simple.
0:10:24 In the case of Tesla, Tesla made the same mistake that most manufacturers in the United
0:10:28 States made is they thought they could set up a system where their intellectual property
0:10:30 rights would be protected.
0:10:35 And then the competitors, BYD, for example, set up a plant across the street and hired exactly
0:10:35 the same people.
0:10:41 So they’d work one shift at Tesla, copy everything they could, work one shift at BYD, install it
0:10:41 all over there.
0:10:46 We’ve seen this story over and over and over again in pretty much every manufacturing sector.
0:10:49 Apple, a little different.
0:10:51 Apple, it’s an assembly story.
0:10:58 Most of the parts that matter for Apple are made somewhere else and everything comes together
0:10:59 in China.
0:11:02 It’s just like the semiconductor sector writ large has its 30,000 pieces.
0:11:04 They come together at Taiwan.
0:11:09 And now Apple has to basically figure out a new model for bringing everything together.
0:11:14 And it’s not clear they can achieve the same scale anywhere else in the world.
0:11:17 So we will probably be taking a few year break from having iPhones.
0:11:24 This was Patrick’s point that the notion that an iPhone domestically manufactured in the
0:11:28 U.S. would cost $3,500, he said it might as well cost a million, that we’re just literally
0:11:29 not capable of it.
0:11:32 A million or a thousand, a thousand individual.
0:11:35 $3,500 assumes you’ve already built the infrastructure.
0:11:36 We have it.
0:11:40 And his point was it would be easier to recreate the Manhattan Project than try to figure out
0:11:42 a way to produce a million iPhones a day.
0:11:43 No, the Manhattan Project was easy.
0:11:47 That was just a few dozen dudes basically running a few gamma ray experiments.
0:11:49 That doesn’t make for a good film.
0:11:54 Yeah, it’s just, it’s like modern, I mean, this little guy, I mean, there’s 1,800 pieces
0:11:58 in this and each of those pieces has their own supply chain.
0:12:02 One of the things that we forget when we talk about electronics is it’s not just like eight
0:12:07 pieces, it’s 800 plus pieces, each of which have their own components.
0:12:13 Computing today, Highland Electronics today requires the entire planet.
0:12:15 And people focus on the United States and China and Taiwan.
0:12:17 It’s not those are unimportant partners.
0:12:23 But for example, there’s a single company in California and another one in Germany that
0:12:29 make very, very small pieces for the manufacturing process that don’t even go into the chips.
0:12:30 But without them, none of it happens.
0:12:33 And there’s 30,000 failure points like that.
0:12:35 So you would not be long Apple stock right now.
0:12:36 You said a couple of years without iPhone.
0:12:37 No, no.
0:12:41 I mean, every time the new phone comes out, I buy a backup because I’m preparing for the
0:12:42 day that this just stops.
0:12:49 But no, it’s like there’s no way that Apple comes out of this without a few years of no
0:12:49 product.
0:12:51 What do you…
0:12:52 So you’re obviously bearish on China.
0:12:54 Who are you bullish on?
0:12:59 If you were willing to dial the clock back to October, I would have been bullish on the
0:13:00 United States on all cylinders.
0:13:02 We’ve got the best demography.
0:13:03 We’ve got the best infrastructure.
0:13:05 We have the best educational system.
0:13:07 We’re more than self-sufficient in energy and food.
0:13:09 We had some gaps.
0:13:12 All of them related to the manufacturing sector.
0:13:14 And really, that was it.
0:13:19 One of the problems that I’ve got with the Trump administration right now is it’s basically
0:13:25 cut off our ability to access the precursor stuff that we need in order to build out our
0:13:26 industrial plant.
0:13:30 So Trump likes to focus on steel and aluminum, not that those aren’t important, but it’s
0:13:31 more than that.
0:13:36 It’s turning raw chemicals into processed chemicals that can then be built into the manufacturing
0:13:36 system.
0:13:38 It’s about a copper smelter.
0:13:42 There’s a thousand things that happen in the processing world that the United States doesn’t
0:13:47 have that we need first if then we’re going to build out the industrial plant.
0:13:50 And Trump has basically made that impossible in the midterm.
0:13:53 So does this all present an opportunity for Europe?
0:14:01 In the short term, again, but their demographics, while not as terminal as the Chinese, are still
0:14:02 pretty bad.
0:14:04 The Chinese are aging faster than anybody else.
0:14:08 And by the end of this decade, they will have the oldest average age of any country in
0:14:09 the world, including Japan.
0:14:14 But the Germans and the Italians and the Dutch are not all that far behind.
0:14:18 So we are in the final years of them having a value-added manufacturing system as well.
0:14:21 Can a lot of these problems be solved with immigration?
0:14:28 I love that you focus on demographics, but can some of this work, labor force and aging
0:14:30 population, be solved with immigration policies?
0:14:34 Based on whose numbers you’re using and how you define Hispanic, because that’s a problem
0:14:41 here in this country, somewhere between one-third and one-half of the American birth rate is
0:14:43 either immigrants or children of immigrants.
0:14:45 And so that’s a non-trivial factor.
0:14:47 The problem’s timing.
0:14:54 So if you can incorporate immigration into your political culture, and so have a dribble
0:15:00 coming in year on, year out, so that those people can be assimilated, then yes, immigration
0:15:02 absolutely can be part of your solution.
0:15:07 But if you have waited, waited, waited, waited, waited until everyone’s old, and then open the
0:15:09 doors, then you’ve got a very different situation.
0:15:12 So take the German example right now.
0:15:17 There’s roughly 80, 82 million Germans, but the average age is now over 50.
0:15:24 So for them to just hold where they are, they need to bring in 2 million people under age 25
0:15:27 every year for the next 20 years, just to hold the line.
0:15:31 And that means you’ve brought in 50 million people, and all of a sudden, the Germans are
0:15:33 no longer the majority in their own country.
0:15:38 That triggers a series of political consequences that I’m not sure the Germans can deal with.
0:15:43 You want to do that in China, you need an order of magnitude more.
0:15:49 And the world, to be perfectly blunt, only can provide those migrants from one place, India.
0:15:51 Wouldn’t that be a hell of a thing?
0:15:57 So if, and there’s a lot of logic here, that a youthful workforce is a productive workforce.
0:16:03 Saudi Arabia, India, Indonesia, who demographically is set up the best?
0:16:05 There’s a mix of countries.
0:16:10 Now, I must underline that all of these countries are aging faster than the United States.
0:16:16 The faster you go through the urbanization and the industrialization experiences, the faster
0:16:18 your birth rate collapses, and the U.S. really is an outlier in that.
0:16:27 But Mexico, Indonesia, India, and Turkey, those are the big four that look really promising
0:16:31 in the future, which isn’t to say they don’t have their own complications.
0:16:33 All of these countries have problems with rule of law, for example.
0:16:37 All of them have problems with infrastructure and electricity and education.
0:16:42 But these are the problems you would expect for countries at their stage of evolution.
0:16:45 We’ll be right back after a quick break.
0:16:51 Support for PropG comes from Vanta.
0:16:56 Starting a company is incredibly gratifying, but can also be one of the hardest things you’ll
0:16:56 ever do.
0:17:00 And one of the most challenging parts of it is making sure that you’re meeting all the security
0:17:02 compliance standards you need to meet.
0:17:04 Vanta makes the whole process easier.
0:17:08 Vanta is a trust management platform that helps businesses automate security and compliance,
0:17:12 enabling them to demonstrate strong security practices and scale.
0:17:17 That means that a whole bunch of tasks that used to be expensive, time-consuming, and complex
0:17:19 can now be automated and streamlined.
0:17:24 Simply put, your company can’t grow if it can’t prove that it’s meeting security standards,
0:17:28 including SOC 2, ISO 27001, and HIPAA.
0:17:34 Vanta can get you audit-ready in weeks instead of months, saving you up to 85% of associated costs.
0:17:38 And Vanta scales with your business, helping you continuously monitor compliance, unify
0:17:42 risk management, and streamline security reviews all in one place.
0:17:44 Starting a business is hard.
0:17:47 Let Vanta make the process a little bit easier.
0:17:51 Go to Vanta.com slash PropG to meet with a Vanta expert about your business needs.
0:17:53 That’s Vanta.com slash PropG.
0:18:01 Support for PropG comes from ShipStation.
0:18:05 If you run any kind of e-commerce business, you know how much chaos can erupt in order fulfillment
0:18:06 and shipping.
0:18:11 And chaos is not a great environment for getting anything done, let alone building your business.
0:18:14 With ShipStation, you can count on your day-to-day to remain calm.
0:18:20 ShipStation helps you ship from all your stores with one login, automate repetitive tasks, and
0:18:22 find the best rates among all the global carriers.
0:18:25 It’s the fastest, most affordable way to ship products to your customers with discounts
0:18:32 up to 88% off UPS, DHL Express, and USPS rates, and up to 90% off FedEx rates.
0:18:37 ShipStation keeps your customers happy with automated tracking updates with your company’s branding.
0:18:41 You can manage all your orders in one easy dashboard, and you never need to upgrade.
0:18:44 ShipStation grows with your business no matter how big it gets.
0:18:49 Deliver a better customer experience and keep chaos at bay with industry-leading scalable
0:18:52 features that help shipments out the door quickly and accurately.
0:18:55 Calm the chaos of order fulfillment with the shipping software that delivers.
0:18:57 Switch to ShipStation today.
0:19:01 Go to ShipStation.org slash PropG to sign up for your free trial.
0:19:04 That’s ShipStation.com slash PropG.
0:19:17 So big news over the weekend with respect to Ukraine taking out 40 strategic bombers from
0:19:18 the Russian Air Force.
0:19:21 It felt, I mean, I thought it was just incredible.
0:19:23 I’ve been watching that video over and over.
0:19:28 Maybe with the exception of the Pager operation against Hezbollah, I think this will go down
0:19:32 as one of the decades, great sort of, I don’t know, military operations.
0:19:37 Curious to get your thoughts on the operation and how you see the Russia-Ukraine conflict
0:19:38 progressing and unfolding.
0:19:42 The technology of what they used was not particularly new.
0:19:46 It looks like what the Ukrainians did is built a bunch of sheds, put them on a bunch of flatbed
0:19:49 trucks and just drove them to their destination.
0:19:51 And when they got within a certain distance, it was pretty close.
0:19:53 These were not long-range drones.
0:19:59 They just abandoned the trucks, remotely operated the roof hatches, and the drones flew out and
0:20:00 did their thing.
0:20:04 It was maybe somewhere between 100 and 150 drones is what most of the reports are saying.
0:20:11 And it took out long-range strategic bombers who were designed to carry nuclear-tipped cruise
0:20:17 missiles to target either extreme Western Europe, North America, or the sea lanes in between in
0:20:18 case of a war with the United States.
0:20:26 So while these craft could have been used, have been used to target Ukrainian targets, the location
0:20:31 of the bases in places like Murmansk and Irkutsk, these are places that were designed to strike
0:20:35 the United States with weaponries that were designed to strike the United States.
0:20:44 And so in one day, Ukraine did more to secure American national interests than any ally has
0:20:46 ever done since 1945.
0:20:49 That is going to resonate in Washington.
0:20:51 That’s a really interesting insight.
0:20:57 So you’re saying this is more a psychological blow or a, well, let me ask you this.
0:20:59 Do you think, do you think the Americans were behind this?
0:21:03 If you would ask me that a year ago, I would have said it would really be hard to imagine
0:21:07 this happening without the Americans behind it in some way with the today’s political environment
0:21:11 and how things have gone, particularly as Vance becomes more and more ingratiated into the
0:21:12 defense community.
0:21:13 Ingratiated, wrong word, intertwined.
0:21:15 I don’t know.
0:21:19 I have a clearance, but, you know, need to know and all that.
0:21:22 I can’t just go through the archives and the defense department whenever I’m in Washington.
0:21:31 But it’s difficult to imagine something of this caliber getting signed off by this White
0:21:31 House.
0:21:37 So this was, again, didn’t use any fundamentally new technologies.
0:21:39 It was just audacity.
0:21:41 And it was amazing.
0:21:42 Yeah, it really was.
0:21:47 So give us your view of the state of play in terms of on the ground there and how the
0:21:50 conflict, you know, who’s winning, who’s losing, how you see it playing out.
0:21:53 Well, the problem is in part demographic.
0:21:58 The Russians are facing something similar to the Chinese, just not on as a steep of a descent.
0:22:02 They know they only have a few years left that they’ll have enough men in their 20s to even
0:22:05 attempt to use military tactics to adjust their world.
0:22:10 And they feel they need to get to something closer to the old Soviet boundaries if they’re
0:22:12 going to be able to defend themselves.
0:22:15 Right now, they’ve got wide open frontiers that are about 3,000 miles long.
0:22:21 If they can get into central Poland and Romania, that shrinks down to about 500 miles.
0:22:23 They feel that’s more manageable, the right.
0:22:28 Unfortunately, that means they have to conquer all or part of a dozen countries that collectively
0:22:30 have a population that’s larger than theirs.
0:22:35 And Ukraine isn’t the first post-Soviet war, it’s the ninth, and it won’t be the last if
0:22:36 Ukraine falls.
0:22:42 So from the Russian point of view, they outnumber the Ukrainians in any fight somewhere like three
0:22:47 to five to one, which means that any fight where the Ukrainians don’t kill three to five
0:22:51 as many Russians as they lose of their own people is a fight that technically the Ukrainians
0:22:53 have lost because their demographics are very similar to the Russians.
0:23:00 So by the numbers, the Russians very much are wearing down the Ukrainians.
0:23:05 The problem with projecting how this war is going to go one way or the other is that the
0:23:06 technology is changing so quickly.
0:23:12 None of the weapon systems that have dominated the battlefield in 2025 existed in 2021.
0:23:19 And we are now in, I think, our 17th turnover in terms of drone technology in Ukraine and
0:23:20 our 11th in Russia.
0:23:25 The Russians aren’t innovating nearly as quickly, but they also can draw upon legacy equipment out
0:23:29 of North Korea, lots of drones out of Iran, and then lots of industrial plant out of China.
0:23:34 So this is a type of war that mixes what we thought we understood with things that are
0:23:38 completely new, and it’s taking us in a lot of really strange directions.
0:23:43 I mean, it looks like the Russian military, which used to be an entirely artillery force,
0:23:48 can barely even use artillery anymore because the Ukrainians can target it before the shell
0:23:49 even drops.
0:23:54 Counter battery has gotten that good in this new acoustic drone detection age.
0:23:56 So I don’t know.
0:23:59 By the numbers, still Russia’s war to lose.
0:24:03 By the numbers, NATO needs to get ready for the next phase because that involves seven
0:24:04 NATO countries now.
0:24:07 But it’s anyone’s guess because the goalposts keep moving.
0:24:11 Other than drones, what are some of those new battlefield technologies?
0:24:16 One of the things that the Ukrainians set up early in the war was a series of basically
0:24:17 microphones along the border.
0:24:22 So whenever the drones, because if you remember, the Shahid drones out of Iran are really noisy.
0:24:27 Whenever the drones started to come in, they could basically get picked up on multiple phones
0:24:30 and figure out what the vector was and where they were going.
0:24:32 And so you could activate air defense on the other side.
0:24:37 The Ukrainians have now turned that into a counter battery fire, which is spectacular.
0:24:42 The Ukrainians have combined drone technology with rocket technology to make rocket drones
0:24:46 that have a range of 1,100 miles they can hit within a couple of meters of their target.
0:24:54 So we’re seeing really, really cheap developments that are outperforming anything that was in
0:24:55 the Russian arsenal before.
0:24:57 And that applies to us, too.
0:25:02 A Ukrainian drone jammer, which is the only reason that Ukraine is still there this year,
0:25:09 which forces the Russians to use fiber optic drones, is now about one-tenth the cost of what
0:25:12 the U.S. produces and performs an order of magnitude more effectively.
0:25:19 And so if you were advising the U.S. and Europe, your general, what I think you said before was that
0:25:25 if Ukraine falls, it’s only a matter of time before there’s a next conflict.
0:25:27 Where do you see that next conflict emerging?
0:25:28 Would it be Poland?
0:25:29 Where would it be?
0:25:34 It will depend upon the tactical situation at that moment, and a lot can change between
0:25:37 now and a hypothetical Ukrainian fall.
0:25:42 But the Russians know they have to reach the Vistola River, and that’s in central Poland,
0:25:43 cuts through Warsaw.
0:25:48 They know they have to be at the Baltic Sea, so they’re the three Baltic republics, and they
0:25:53 know they have to reach the Danube, which will include the northeastern sliver of Romania.
0:25:58 So which one of those the Russians would go for would be shaped by the tactical situation at the
0:26:02 moment they felt the need to pull the trigger, but they need all of that territory.
0:26:06 And now that Finland is in NATO, they would definitely go for Finland as well if they thought
0:26:07 they could pull it off.
0:26:13 I would guess they would do the Baltics first because it looks, from the details, the simplest,
0:26:16 but the tactical math changes pretty rapidly.
0:26:19 And you think they have the economy and the war machine.
0:26:22 I mean, my sense of all of this is it’s kind of defanged them a bit.
0:26:25 You think they still would have the capacity to wage more war?
0:26:29 If you had asked me that a year and a half ago, I would say that a very real concern that
0:26:31 they simply don’t have the capacity to carry it forward.
0:26:31 Now I’m not so sure.
0:26:37 So few of the legacy weapon systems that the Russians started this war with are still being
0:26:38 used.
0:26:39 This is a drone fight now.
0:26:44 Something like 70% of the casualties over the last eight months have been first-person
0:26:45 drones.
0:26:46 It’s a different math now.
0:26:51 Artillery, tanks, jets just don’t mean as much as they used to in the current context.
0:26:57 I just underline that we are very early in this transition and guessing what these weapons
0:27:02 systems are going to evolve into over the next five years would be as foolhardy as guessing
0:27:05 three years ago that we would have ended up in some version of where we are today.
0:27:07 This is all very new, changing very rapidly.
0:27:13 My sense is that it’s always the stuff you’re not worried about that gets you.
0:27:17 And I don’t think we were that worried about India and Pakistan until recently.
0:27:19 What’s your take on the situation there?
0:27:25 Well, the Americans love to ignore India and Pakistan because there’s obviously no solution.
0:27:29 You’ve got two countries that don’t like each other on a border that is not economically
0:27:33 important, which means they can piss back and forth over the line however much they want.
0:27:36 And until a nuke gets used, no one in the rest of the world really cares.
0:27:43 So unfortunately, or fortunately, based on your point of view, that assessment is broadly
0:27:49 accurate and has not evolved, uh, in any real war.
0:27:55 It goes to nukes very quickly because neither of them have the capacity to really hurt the other
0:27:57 side in any other way.
0:27:58 The Thar Desert is there.
0:28:00 Kashmir is broadly worthless.
0:28:04 Uh, you’re talking about glaciers and empty mountainsides.
0:28:12 So they’re fighting over an idea, which means that it can be trumped up or tamped down based
0:28:14 entirely on domestic politics.
0:28:19 And unfortunately, earlier this year, they both had a vested interest in plumping it up more
0:28:20 than it needed to be.
0:28:25 Whether or not the current ceasefire will hold, that is also a question of internal domestic
0:28:25 politics.
0:28:29 So both of us predicted that Biden would be reelected.
0:28:30 What do you think we got wrong?
0:28:32 Technically, he didn’t run.
0:28:33 So, you know.
0:28:34 Fair enough.
0:28:35 Fair enough.
0:28:40 Yeah, when I did my postmortem, my general idea was that for the first time in modern
0:28:47 American history, in two elections in a row, the independents flipped.
0:28:52 So the way it worked before is every time we had a fresh elections, the independents would
0:28:53 vote for the other guy.
0:28:56 They, they’re notorious for having buyer’s remorse.
0:29:01 But when it came to Trump, they changed their mind because Trump basically said, your vote
0:29:02 doesn’t matter.
0:29:04 So I don’t care about you at all.
0:29:06 And their response was basically, hold my beer.
0:29:11 And the independent vote in the United States, the 10 percent of Americans who really are
0:29:16 independent, did continue to turn against Trump, actually turned more strongly in this most
0:29:17 recent election.
0:29:21 But everyone else went the other direction.
0:29:28 Every single voter demographic, 49 of the 50 states shifted towards Trump, which blew away
0:29:30 any significance for the independent vote.
0:29:32 And what do you see going on here?
0:29:36 I mean, you talk a lot about other nations and geopolitics.
0:29:43 What do you, what do you think are the undercurrents in the U.S. that led to, I mean, I was shocked
0:29:44 by this, this election.
0:29:49 I didn’t, I not only didn’t see Trump winning, but I didn’t see him winning as soundly.
0:29:54 Any themes that you think are emerging out of the U.S. that kind of go against conventional
0:29:55 wisdom?
0:29:57 So first, let’s not overplay it.
0:30:06 Trump, um, Trump beat Harris by the same margin as Biden beat Trump.
0:30:12 So it’s really only a 3% switch in the, in voter preferences in the right places.
0:30:18 electoral system mucks up the analysis, but really it wasn’t nearly as title as a lot
0:30:20 of people would like to think it is.
0:30:22 Uh, the second issue is more historical.
0:30:27 Uh, we have a first past the post single member district system, which is a really technical
0:30:32 way of saying that you vote for one person who represents a specific geography and a specific
0:30:33 group of people.
0:30:35 You’re not voting for an idea or a party on a national basis.
0:30:37 You’re voting for a district.
0:30:44 And what that means is we tend to have really, really big tent parties that are not driven
0:30:46 by all ideology with a lot of factions within them.
0:30:53 And those factions get more or less powerful based on changes in demographics or technology
0:30:57 or trade or security or culture or immigration, thousand different issues.
0:31:04 But every once in a while, about once or twice a generation, the changes become so significant
0:31:08 that the factions that are under the tent, don’t just rise and fall within the tent.
0:31:11 They jump out of the tent or maybe jump into the other tent.
0:31:13 And that’s what’s going on right now.
0:31:16 It’s the sixth time we’ve done this as a country.
0:31:22 We will get through it, but it’s really awkward because all of the old rules have gone away and
0:31:23 the new rules are not in place.
0:31:27 So I would argue that in this last round, the democratic party died.
0:31:32 I’m not sure they’re going to come back, but the Republican party died too.
0:31:39 It is MAGA now and MAGA doesn’t have a wide enough base to win an election.
0:31:44 So we’ve got two things that call themselves parties that can’t possibly win.
0:31:46 It’s just a question of who can lose more.
0:31:49 And last time the Democrats pulled out all the stops.
0:31:55 So staying on the U.S., talk about the U.S.
0:31:59 This is a little bit like saying Europe, and that is there are just different regions and
0:32:02 cultures and economic bases in the U.S.
0:32:07 Where in the U.S. or which regions do you think are poised to be the biggest winners and losers?
0:32:10 From deglobalization?
0:32:14 Deglobalization, AI, whatever big themes you see in the U.S.
0:32:17 I’ll put AI to the side because that’s not going to happen for such that later.
0:32:20 We need to double the size of the industrial plant.
0:32:26 And for that, you need workers, you need green space, you need infrastructure, and you need
0:32:29 a regulatory structure that is friendly to the investment.
0:32:35 You put all those together, you’re basically looking at an area that starts roughly in Norfolk
0:32:41 and Richmond in Virginia, comes down through the south into Texas, and then up through the
0:32:44 Rockies to maybe Denver and Salt Lake City.
0:32:50 So down from the west, from the mountain west down into Phoenix, over through Texas, then up
0:32:53 to the very, very southern tip of the Mid-Atlantic.
0:32:57 That’s the section that can most benefit from where we are.
0:33:01 The problem that all of these areas are going to have is, first and foremost, electricity.
0:33:05 If you’re going to double the size of the industrial plant, that means you need to at least
0:33:06 expand the grid by half.
0:33:11 And we now need to do that without the Chinese, and that will not be cheap, and that will not
0:33:12 be quick, and that will not be easy.
0:33:15 But until we do that, none of the rest of this matters.
0:33:20 But it’s all based on a premise that we need to further expand our industrial base.
0:33:24 The economy has done really well moving more to a services base.
0:33:26 Why is an industrial base so important to the U.S.’s future?
0:33:29 There’s a national security component to it.
0:33:30 Trump is not making that up.
0:33:35 But more importantly, the Chinese system is dying, and we need to prepare.
0:33:39 And that means if we want stuff, it needs to be made somewhere else.
0:33:41 Does it all need to be made here?
0:33:41 No.
0:33:47 And the wider the net that we throw, the more countries we bring into whatever the post-globalized
0:33:50 order happens to be, the easier and faster this will be.
0:33:56 We cannot do it in anything less than a 20-year time frame without Canada, and especially Mexico.
0:34:04 So when Trump in his first term renegotiated NAFTA, and basically we got the guy who was calling
0:34:09 Mexicans rapists, all of a sudden being the Mexicans’ best friend in trade talks, I was
0:34:16 really optimistic, because if you take the most rightist, anti-immigrant, anti-foreigner aspect
0:34:23 of the American polity, which is Trump, and you make that friends with Mexico, that’s a pretty
0:34:24 bright future.
0:34:27 But we’re kind of up in the air again.
0:34:30 So you talk a little bit about Mexico.
0:34:32 What are your thoughts on Latin America, specifically Brazil?
0:34:36 Well, Brazil is its own beast.
0:34:41 The demographics are very rapidly aging, and they haven’t built out the industrial plant
0:34:43 that they need for what’s coming.
0:34:48 Their agriculture and industrial system are the highest cost producers in the world, which
0:34:51 only works if the Chinese are paying for everything.
0:34:53 So when China’s strong, Brazil is strong.
0:34:55 You remove China, all of a sudden Brazil looks really bad.
0:34:59 They’ve also lost a lot of their industrial plant to the Chinese.
0:35:05 Under Lula last time, he invited in the Chinese to do a lot of joint ventures, which from the
0:35:09 Chinese point of view, as we come in, we build a joint facility, we steal all of your technology,
0:35:12 we take it home, and then we drive you out of business on a global basis.
0:35:14 And there’s just not much left in Brazil at this point.
0:35:20 So we talked a little bit about demographics and some of the countries you think that are not
0:35:21 well-positioned.
0:35:26 If you’re the U.S., and realizing it’s a global world,
0:35:29 you talked a little bit about the importance of the U.S.-Mexico relationship.
0:35:31 What about U.S. and Canada?
0:35:37 Are there other allies we should be focused on developing stronger partnerships with?
0:35:45 We already have free trade deals with Central America, Mexico, Canada, Japan, Korea, functionally
0:35:46 with Taiwan.
0:35:50 If the Brits can ever figure out what happens after Brexit, we’ll have a deal with them as
0:35:50 well.
0:35:52 So that’s the core.
0:35:54 And that’s a great starting point.
0:35:58 If you were to add one more big thing, I would say Southeast Asia.
0:36:00 The demographics are pretty good.
0:36:01 The industrial plant is already pretty good.
0:36:06 They’re very well positioned to pick up anything that the Chinese drop.
0:36:09 They are a bridge to India, which is a non-insignificant power.
0:36:15 But the biggest thing I like about Southeast Asia is we’re already friends, courtesy of
0:36:19 our relationship with Australia and New Zealand, and they have a big consumption base.
0:36:25 So this is already a billion people with a demographic that is very primed for consumption.
0:36:32 It’s exactly the sort of partner that you would like to preserve as the broader world breaks
0:36:32 down.
0:36:35 I brought up AI, and you said it’s not going to happen.
0:36:36 Say more.
0:36:36 Sure.
0:36:43 So there’s about 30,000 parts that go into your typical semiconductor, not counting the
0:36:46 things that do the manufacturing, like, say, the lithography systems that came out of
0:36:47 ASML in the Netherlands.
0:36:52 So functionally, you’ve got 50,000 failure points in that sector.
0:36:57 Right now, everything that we’re running a large language model on requires a chip that
0:37:03 is roughly seven or six nanometers or smaller, and the newer chips that we’re making for AI
0:37:07 are roughly two nanometers and have encoded cooling into them.
0:37:08 We don’t have those yet.
0:37:11 That’s what they’re working on building, hopefully getting out onto the market within the next couple
0:37:12 of years.
0:37:18 If we can’t make those high-end chips, if we can’t do anything with extreme ultraviolet,
0:37:22 which is how pretty much everything under 12 nanometers is made now, we have to go back
0:37:26 to an older, simpler technology called Deep Ultraviolet.
0:37:31 And that would suggest that the only chips we’re going to be able to make at scale are going
0:37:33 to be 14 nanometers or bigger.
0:37:40 So we will need five times as many of those to fill the data centers to get the same compute
0:37:40 power.
0:37:46 And that will take four to five times as much power in order to operate the center.
0:37:54 So we’re looking at a 95% reduction on a cost basis in order to run AI models that we had
0:37:55 last year.
0:37:57 ChatGPT 4.0, that won’t be able to work at all.
0:37:59 But ChatGPT 3.0, probably.
0:38:07 So that lasts until such time as we rebuild the supply chain in a more demographically stable,
0:38:09 geopolitically stable zone.
0:38:11 That’ll take 20 years.
0:38:17 A lot of what you’ve said the last few minutes kind of bubble up to the need for a dramatic
0:38:20 increase in our power grid or ability to produce electricity.
0:38:26 Which of these energy technologies are you most bullish and bearish on?
0:38:27 I want them all.
0:38:32 Because it’s like we’re past the point where we can pick a winner and that’ll do it.
0:38:33 We have to do so much so fast.
0:38:36 So number one, we’re not going to retire anything.
0:38:37 I don’t care if it’s coal.
0:38:38 We don’t have the option anymore.
0:38:41 If we’re going to still have manufactured product, we have to do it here.
0:38:43 We have to do it with the grid that we have.
0:38:45 It’s kind of like the military going into Iraq.
0:38:47 You fight with the military you have.
0:38:52 The idea of transforming it into something hypothetical and in the future is gone.
0:38:59 In addition, wind and solar, while we do have some of the world’s best wind and solar acreage
0:39:01 in the Southwest for solar and the Great Plains for wind,
0:39:08 two-thirds of the cost of a solar or wind facility has to be financed because it’s all up front construction.
0:39:12 It’s not a subscription model like it would be for coal or natural gas.
0:39:18 Which means unless the geography is really, really, really good for installation,
0:39:22 we’re not going to do it anymore because we’ve seen capital costs increase by a factor of four
0:39:24 in just the last five years.
0:39:30 That won’t come down until we have another generation that ages into the capital class,
0:39:32 which is typically people aged 55 to 65.
0:39:34 Those are the people who are saving for retirement.
0:39:36 That’s 70% of all private capital.
0:39:40 We’ve been relying on the baby winners until now, but now they’re two-third retired.
0:39:45 And so the capital just isn’t there for the green transition to happen at all.
0:39:49 I would love for nukes to be part of the equation,
0:39:54 but we still haven’t built a prototype for a fourth-generation nuclear power plant
0:39:56 or a small modular reactor.
0:39:58 So we’re stuck with a third generation.
0:40:01 And the regulatory structure for that is very strict.
0:40:05 And as a result, we’ve only built one in the last 50 years.
0:40:09 So we’re looking at mostly coal and gas,
0:40:12 a sprinkling of solar and wind where it makes sense.
0:40:14 And after that, we have to get creative.
0:40:16 We’ll be right back.
0:40:24 Support for the show comes from TED Next.
0:40:25 Let’s be honest, we’re not just busy.
0:40:28 We’re experiencing the greatest acceleration of change in human history.
0:40:31 The pace of technology has left regulation, culture,
0:40:34 and even our own biology in the dust.
0:40:37 And somehow we’re supposed to figure out who we want to be.
0:40:39 That’s what TED Next is built for,
0:40:43 to provide a toolkit for navigating a world where yesterday’s playbook is already obsolete.
0:40:47 It’s an invitation to join a community of visionaries, emerging leaders, innovators,
0:40:49 culture shapers, and change agents.
0:40:52 And they all want to take the next step on their life’s journey together.
0:40:56 If you want to be part of something meaningful and energizing, TED is for you.
0:40:58 I’ve spoken to TED myself.
0:41:02 After working my ass off for 30 years, I was an overnight success after speaking to TED.
0:41:05 I like the community, and I really found it very rewarding.
0:41:09 Register for TED next, November 9th through 11th in Atlanta.
0:41:13 It’s a reconvergence where career advancement meets personal reinvention,
0:41:15 both non-negotiable for tomorrow’s leaders.
0:41:21 And right now, TED is offering our listeners a special rate at TED.com slash Scott.
0:41:24 Again, that’s TED.com slash Scott.
0:41:32 Support for the show comes from NPR’s Planet Money.
0:41:35 Tariffs, meme coins, Girl Scout cookies.
0:41:36 What ties them all together?
0:41:38 One word, money.
0:41:41 It’s the connective tissue of modern life, and it drives behavior, shapes culture,
0:41:44 and reveals what we value in a tangible way.
0:41:47 Economics isn’t just GDP and interest rates.
0:41:49 It’s everywhere and everything fueling our lives.
0:41:53 If you’re looking for a smart, entertaining breakdown of how the world of money really works,
0:41:55 check out Planet Money from NPR.
0:41:57 It’s sharp, fast, and relentlessly curious.
0:42:02 30 minutes is all they need to help you understand the complex forces, moving markets, people,
0:42:04 and power in a down-to-earth way.
0:42:07 The Planet Money hosts go to great lengths to help explain the economy.
0:42:11 They’ve done things like shoot a satellite into space, become a record label,
0:42:14 make a comic book, and shorted the entire stock market,
0:42:16 all to help you better understand the world around you.
0:42:20 If you’re curious to learn something new and exciting about economics,
0:42:22 every week listen to the Planet Money podcast from NPR.
0:42:24 I cannot say enough about NPR.
0:42:29 Anything you listen to on NPR is going to be well-produced and have great production values.
0:42:31 Tune in to Planet Money every week for entertaining stories
0:42:34 and insights about how money shapes our world,
0:42:36 stories that can’t be found anywhere else.
0:42:39 Listen now to Planet Money from NPR.
0:42:51 We’re back with more from Peter Zion.
0:42:58 I’m fascinated by you because you, as much as almost anyone I know, have created—
0:43:03 I had never heard of you three, four years ago, and now you’ve developed this personal brand.
0:43:07 Well, you didn’t run for elected office.
0:43:08 You’re not an athlete.
0:43:14 You basically have kind of built this incredible brand around very provocative predictions.
0:43:15 And I make a lot of predictions.
0:43:17 And quite frankly, you get a lot of yours wrong,
0:43:21 but you always inspire an interesting—you catalyze an interesting conversation.
0:43:23 And I think that’s why people are really drawn,
0:43:26 because even with stuff I think, well, that can’t happen,
0:43:28 it gets you thinking.
0:43:31 I would just like to know more about you.
0:43:32 Like, what’s your origin story?
0:43:35 How did you get—how did you get to this point?
0:43:37 It’s not all that exciting.
0:43:41 I was just always the kid who had to figure out why things worked the way they did.
0:43:45 And so, like everyone else who was interested in international affairs,
0:43:49 I went to Washington for my first year out of grad school and hated it.
0:43:51 I was there for 10 months.
0:43:52 It was nine months too long.
0:43:58 And then I ended up working for a private intelligence company slash media company for 12 years,
0:44:00 where I ended up being their global generalist,
0:44:04 kind of putting everything together into a tapestry.
0:44:09 And then 12 years ago, I left that company.
0:44:09 Now I do this.
0:44:11 And what is this?
0:44:15 I help companies and entities, usually at the local government level,
0:44:18 figure where global trends are going and the problems
0:44:21 and the opportunities they’re going to have in front of them in the not-too-distant future.
0:44:28 So is it like a green mantle or a, you know, what’s it called, Eurasia Group?
0:44:34 Eurasia Group is more focused on the here and the now and the government decision-making apparatus.
0:44:37 Not that that’s not important, but that’s not what I do.
0:44:42 I focus on the longer-term trends of geopolitics, trade, security tech, and, of course,
0:44:46 demographics to tell us, you know, this is going to be the big picture that you’re going to deal with.
0:44:48 But if you want to know what happens next Tuesday, talk to Ian Bremmer.
0:44:51 And do you connect that to alpha?
0:44:53 Do you get hired by hedge funds to try and come up with investment things?
0:44:57 I do get hired by hedge funds and financial houses a lot.
0:44:59 I do not do tactical trading advice, though.
0:45:00 Got it.
0:45:04 And I’m curious, Peter, do you have kids?
0:45:04 No.
0:45:06 No kids.
0:45:07 No, I’m part of the problem.
0:45:08 You’re part of the problem.
0:45:11 And are you worried about kids being born generally?
0:45:15 And how do you feel about the prospect of this, the next generation in America?
0:45:19 Well, if you’re in the United States and you have any, any opinions about when the United States
0:45:26 should be, the most reliable way to make that happen is to ensure the existence of the next
0:45:28 generation and instill them with your values.
0:45:30 So I will never tell people to not have children.
0:45:33 We’re not going to face an energy crisis.
0:45:35 We’re not going to face a food crisis.
0:45:40 Our financial crisis is going to be something that is mild compared to the rest of the world.
0:45:43 Our challenge is to build.
0:45:47 As problems go, that’s not bad.
0:45:49 Where do you find inspiration?
0:45:51 Do you have any go-to sources in terms of media?
0:45:53 Where do you spend your time trying to get insight?
0:46:01 As technology has evolved, the entire media sector has basically removed more and more
0:46:03 eyes and fingers from the process and automated everything.
0:46:08 So there aren’t a lot of people left in global media or national media to basically do the smell
0:46:09 check.
0:46:12 And so we’ve replaced it on a global basis with opinions.
0:46:16 And that is definitely part of the problem in our political space right now.
0:46:21 It’s just there’s no incentive on any side to actually put forward something that has been
0:46:22 checked.
0:46:28 If someone, I would think a lot of people look at Peter Zion and think, I want to be
0:46:28 you.
0:46:31 It seems to me like you have a pretty cool life.
0:46:33 There are a lot of migraines that go with it.
0:46:34 I’m not sure it’s all it’s cracked up to be.
0:46:39 Yeah, but at least the perception, I don’t know what the reality is, but the perception is
0:46:41 you lead a very interesting life.
0:46:42 You do interesting work.
0:46:44 You’re doing what you want to do and you make a really good living.
0:46:46 And I think a lot of young people would like to be Peter.
0:46:52 I’m curious if you were helping someone develop a business plan to become a thought leader
0:46:55 or develop a strategy firm, a geopolitical advisory firm.
0:47:03 In terms of basic strategy focus and specifically which platforms to try and weaponize, you strike me.
0:47:05 It feels, I feel like you were invented for TikTok.
0:47:09 You’re just, you have these very provocative insights.
0:47:11 Just to be clear, I’m not on TikTok.
0:47:13 You’re not?
0:47:13 No.
0:47:16 Well, I stand corrected.
0:47:16 Where do I see?
0:47:17 I see you everywhere.
0:47:18 Where am I seeing you?
0:47:18 YouTube?
0:47:20 I’m on YouTube.
0:47:24 We have a Patreon page, which is our primary distribution for subscribers.
0:47:27 But yeah, we’re in a lot of places, but never, never TikTok.
0:47:28 That’ll never happen.
0:47:30 Well, let’s go there.
0:47:34 You are worried about your being on TikTok.
0:47:35 Oh yeah, I would never do it.
0:47:40 So let’s start with the devil we know, Facebook meta, whatever you want to call it.
0:47:45 So whenever you post something on Facebook, whenever you have Facebook on your computer,
0:47:52 even if it’s not open, unless you’ve deleted it and logged out, Facebook is capturing every
0:47:54 keystroke on your computer.
0:48:01 And they use that information to bundle you into like groups of roughly 10,000 with similar
0:48:06 demographic structure, similar economics, similar political leanings, maybe similar kinks.
0:48:09 There’s dozens of tags.
0:48:16 They put you into a group of 10,000 and then they actively market you to scammers based
0:48:19 on what sort of fraud they think you will fall for.
0:48:22 And there are those, there are two conventions a year, one in Vegas, one in Germany.
0:48:23 Isn’t that consumerism?
0:48:25 Didn’t you just describe American capitalism?
0:48:26 Tobito, to potato.
0:48:28 But they actively do it.
0:48:30 But when they do it, they anonymize your data.
0:48:34 So they, you become user one, two, three, for example.
0:48:35 All that data is there.
0:48:38 The people can still target you personally, but they don’t have like your name.
0:48:41 TikTok doesn’t anonymize.
0:48:42 It’s your name.
0:48:43 It’s your social security number.
0:48:44 It’s your entire credit history.
0:48:46 And that gets sold on.
0:48:48 So yeah, I will never, ever be on TikTok.
0:48:54 But let’s back to, we’re starting Yosemite Geopolitical Advisory Group.
0:48:56 What has worked really well for you?
0:48:57 What mistakes have you made?
0:49:01 If you were advising, if you were investing your own money and wanted to advise a group of
0:49:05 young men and women to launch a similar firm, what’s worked really well for you?
0:49:08 Well, everything that we do is custom.
0:49:13 So we figure out the world from the client’s point of view before we say anything.
0:49:19 And then we put it against the backdrop of deglobalization and strategic shifts and demographics.
0:49:22 And we see what is relevant to them.
0:49:29 It is difficult to imagine anyone else replicating what we do without having 20 years of experience
0:49:30 in the background, building that baseline.
0:49:34 We actually spend probably about half of our time looking for things that prove the baseline
0:49:35 wrong.
0:49:42 So, because we base everything off of that, does that mean that what I’m doing is not
0:49:43 replicable?
0:49:47 Not necessarily, but it does mean moving forward, it’s going to be a lot more difficult.
0:49:51 Because when you get to the point where globalization really does break and we’re really close to
0:49:56 that, like an entirely new baseline is going to have to be invented for a world where all
0:49:57 of a sudden the old rules don’t play.
0:50:03 And the stability that has been the backbone of all economic development over the last 75
0:50:08 years is going to turn into something completely different, a lot more random, a lot more disruptive.
0:50:16 I’m not sure it’s a great time to be getting into my business on a strategic level, but the
0:50:22 number of tactical applications, if you can take a narrow review, I think are legion in the
0:50:23 world we’re about to be in.
0:50:29 And if you were going to start your business over, would you do the exact same thing or would
0:50:30 you have a different focus?
0:50:32 I’d learn to weld and I’d learn Spanish.
0:50:33 Say more?
0:50:33 Sure.
0:50:35 I mean, we need to double the industrial plant.
0:50:37 Spanish is the number two language in the United States.
0:50:41 Mexico is our number one trading partner, will be at least for the rest of my life.
0:50:45 The fastest way to get six figures is to speak Spanish and have a trade.
0:50:50 And as we wrap up here, I just want to do a kind of a lightning round here.
0:50:56 Name an influence or influences in terms of education or people in your life early on that
0:50:57 really shaped who you are.
0:50:59 George Herbert Walker Bush.
0:51:05 Well, he was the he was the president of the most important inflection point in modern history.
0:51:07 He was taking us from the Cold War to whatever was next.
0:51:14 And he tried to get us to have a conversation with ourselves about what should we do with globalization?
0:51:18 What should we do with this alliance, the greatest alliance in human history and a system that
0:51:20 generated the fastest economic growth ever?
0:51:24 How should we reshape it for a post-Cold War era?
0:51:27 And what sort of world do we want to leave for the next generation?
0:51:29 So, of course, we voted him out of office.
0:51:35 It’s funny you don’t hear that many people talk, speak about him, not as glowingly or as in that
0:51:36 kind of singular fashion.
0:51:39 And where does Peter Zion invest?
0:51:40 Like, where do you put your money?
0:51:42 I’m not a fan of this guy.
0:51:45 I’m certainly not a CFA, so I can’t really give you any tactical advice.
0:51:45 It’s an investment.
0:51:47 It’s not investment advice.
0:51:50 I’m just curious if to the extent you’re willing to disclose it, where do you put your money?
0:51:53 Well, I’m in I’m in flux right now, just like the United States is.
0:51:57 If you go back to October, everything, everything that I had was in U.S.
0:52:03 mid cap because those are the companies that have the combination of fundraising plus access
0:52:09 to rule of law, demographic trends, production, everything that goes along with urbanization
0:52:10 that we need.
0:52:14 I liked products that were energy intensive because we have the cheapest energy.
0:52:17 I liked where the demand profile is driven by demographics.
0:52:18 We had the best in the rich world.
0:52:20 And if that end product could be exported, I really liked it.
0:52:29 But in the last three months, the policy has basically punished anyone who wants to invest
0:52:30 in the United States.
0:52:35 The Trump administration’s policies are actively discouraging investment.
0:52:42 We’ve now had, as of today, 133 different tariff policies since January 20th.
0:52:46 And as long as the goalposts keep moving, no one knows what to do.
0:52:48 So construction spending has just stopped.
0:52:54 And until we get to the other side of this, I don’t know where to put my money.
0:52:58 And just as we wrap up here, best piece of advice you’ve ever received?
0:53:00 Go long.
0:53:06 It’s like I was told by my advisor when I was in grad school that, you know, you’re at the
0:53:09 age where you’re going to screw up and that’s fine.
0:53:10 Go long.
0:53:12 Hit hard.
0:53:14 And if you have to change tack in a year, fine.
0:53:20 I had a number of people after him who tried to talk me out of that.
0:53:23 And if I, every time I listened to their advice, I regretted it.
0:53:27 Peter Zine is a geopolitical strategist and founder of Zine on Geopolitics.
0:53:32 Before launching his own firm in 2012, he spent over a decade at the geopolitical intelligence
0:53:34 company Stratfor.
0:53:36 Peter, I really appreciate you coming on.
0:53:38 We’ve been trying to get you on for about a year.
0:53:47 I’m so sort of impressed by you have these data rich, provocative, really kind of courageous
0:53:51 out there, often wrong predictions, but you inspire a conversation.
0:53:53 And I think that’s really important.
0:53:58 I really enjoy your work and just appreciative that you took the time to join us today.
0:53:59 It’s been my pleasure.
0:54:14 Algebra of happiness, good friends and hard truths.
0:54:18 The most successful people, everyone has a certain amount of bad judgment in their life.
0:54:23 I have a really close friend who’s just got the most remarkable judgment.
0:54:29 Any room, he asks the right questions, a baller professional, a great friend, helping take care
0:54:30 of his parents.
0:54:34 Just the kind of guy you’d call and ask about anything and he’d give you a reason take and
0:54:39 you think, God, this guy’s just so impressive and has such good judgment, takes all of his
0:54:41 bad judgment and throws it into his relationships.
0:54:49 It’s a shit show with respect to his life partners, picking just low character people who are bad
0:54:49 for him.
0:54:53 And everybody has a certain amount of bad judgment, everybody.
0:55:01 And hopefully you have friends that not only serve as conduits for a good time and connections
0:55:08 and making memories, but are also willing to ask hard questions and present hard truths.
0:55:15 When I started an e-commerce incubator, I was going to put my consulting firm profit into the
0:55:17 incubator such that we had it all under one roof.
0:55:21 And one of the board members of my e-commerce incubator said, Scott, do you really want to do
0:55:27 that? Because if this doesn’t work out, granted, his motivation, his interests were for me to have
0:55:27 everything in this thing.
0:55:30 But he said, if it doesn’t work out, you lose everything.
0:55:33 Whereas why wouldn’t you maintain that diversification?
0:55:40 And so I didn’t put profit into Brand Farm, which basically shut down in the dot-com or the dot-bomb
0:55:40 implosion.
0:55:42 And I would have lost everything.
0:55:45 Instead, I had profit, which I sold a few years later and got.
0:55:49 After I split my proceeds with my partner, my ex-wife, I got three million bucks.
0:55:55 But three million bucks was a lot of money for me, you know, in the in the aughts such
0:55:57 that I could start a new life in New York.
0:56:02 And this was because a friend just saw something that I didn’t see.
0:56:07 I have on a few occasions said to somebody, you’re in a shitty relationship.
0:56:08 What are you doing?
0:56:09 What are you doing?
0:56:15 I had another friend about to leave an amazing job at AOL where he was making millions of dollars
0:56:19 a year in his 30s and said, oh, me and my wife have decided we’re going to go to Europe
0:56:21 for a couple of years and just be vagabonds.
0:56:22 I’m like, don’t be a fucking idiot.
0:56:24 Do you think it’s easy to make this kind of money?
0:56:29 Go to Europe when you’re 40 and you’re worth 20 million, not 3 million.
0:56:32 You’re going to give you’re at the home of the bobsled right now.
0:56:35 Believe it or not, that was AOL in the 90s, making a shit ton of money.
0:56:38 But you’ve decided you’re sort of vogue and cool.
0:56:39 I’m like, you’re not that granola.
0:56:41 You like money as much as all of us.
0:56:46 And I presented that to my friend Greg and he listened and they stayed.
0:56:51 And by the way, they are really grateful because what they found is all of us found out was when
0:56:53 this dot bomb hallucination came to an end.
0:56:55 It’s really hard to make money.
0:56:59 While we believed in our 30s, we were masters of the universe.
0:57:02 We found out, wow, making money is really hard.
0:57:05 And if you’re making money, you know, be careful what you give up.
0:57:06 Is money everything?
0:57:08 No, but it’s a lot in a capitalist society.
0:57:11 Is your friend about to get married to someone?
0:57:16 I have had friendships kind of come off the tracks because I’ve said to people, I don’t
0:57:17 think you should get married.
0:57:20 I don’t think this is a good fit for you.
0:57:25 And what I have found is over the long term, the friends who do it in a generous, nonjudgmental
0:57:27 way say, have you really thought this through?
0:57:32 Your friendship might take a hit in the short run.
0:57:34 You’re drinking too much, boss.
0:57:36 You’re drinking too much.
0:57:38 What the fuck are you on?
0:57:41 The last two or three times, I have a good friend in New York, last two or three times.
0:57:43 I don’t know if he’s on ketamine.
0:57:43 I don’t know what he’s on.
0:57:46 I’m like, you’re disappearing to the bathroom.
0:57:46 You come back.
0:57:47 You’re skittish.
0:57:49 What the fuck is going on with you?
0:57:51 And that was a very uncomfortable situation.
0:57:54 And by the way, that person has not reached out to me since then.
0:57:56 And here’s what I know is going to happen.
0:57:59 In a couple of years, this person is going to say, thank you.
0:58:01 I’ve had people save me from myself.
0:58:03 Hard truths.
0:58:09 Hard, uncomfortable moments done in a generous, loving, and nonjudgmental way.
0:58:12 That is what it means to be a good friend.
0:58:15 It is very hard to read the label from inside of the bottle.
0:58:21 And good friends will help you see the obvious and are willing to have those uncomfortable conversations.
0:58:28 Do you have a friend, a real friend, where you need to express friendship and illuminate a hard truth for them?
0:58:34 This episode was produced by Jennifer Sanchez.
0:58:36 Our intern is Dan Shallon.
0:58:38 Drew Burrows is our technical director.
0:58:41 Thank you for listening to the Prop G pod from the Vox Media Podcast Network.
0:58:45 We will catch you on Saturday for No Mercy, No Malice, as read by George Hahn.
0:58:52 And please follow our Prop G Markets pod wherever you get your pods for new episodes every Monday and Thursday.