(Guest Post by Matthew Ladner)
Peter Zeihan manages to build incredibly optimistic and pessimistic visions of the immediate future into a single book. Let’s start with the good news: Zeihan builds a compelling case that the United States has been and will continue to be the most incredibly advantaged nation on the planet. This owes both to geography and other factors. In terms of geography, the United States contains both the largest navigable river system (the Mississippi and six tributaries) that delightfully sits right next to the world’s largest bloc of temperate zone arable land (the Midwest). Add to that a presence on both the Atlantic and Pacific, an abundance of world-class harbors and then a free-wheeling economic culture in which the industrial revolution took root and flourished. Add all of this up, and the United States was in a position to make an incredibly generous offer to most of the rest of the planet towards the end of World War II. The United States offered to secure global maritime shipping and grant access to sell in American market in return for approximately nothing, with approximately nothing quickly morphing into “joining the global military alliance aimed at containing the Soviet Union.”
All in all Pax Americana proved to be a smashing success- the world recovered and prospered. Global poverty dropped, and the number of nations wanting in on the deal steadily grew. Eventually even China wanted in, and then in the early 1990s the Soviet Union collapsed. The end of history!
Not so fast…the story continues.
The end of the Cold War obviously raised questions regarding the United States continuing to bear the imperial burden. Zeihan notes that the United States is actually one of the world’s least internationalized economies- selling and buying in large volumes, but as a relatively small portion of the total economy. Outside the odd BMW most everything you want is available here, especially if you consider Canada and Mexico “here.” A continuing motivation for the United States continuing Pax Americana however had been the importation of oil. Somewhere along the way the United States had switched from being the world’s largest oil exporter to the largest importer. The United States thus had an incentive to secure oil supplies, primarily in the Middle East.
Two things intrude into this state of affairs. First, the United States created entitlement programs that are badly underfunded vis-a-vis the ongoing retirement of the Baby Boom generation, likely impacting both our ability and willingness to bear the imperial burden. Second, the advent of fracking has put the United States in a position to feel rather indifferent about Persian Gulf Oil. Zeihan’s conclusion of the optimistic portion of his book is that while tough days lay ahead, the United States is going to get through it in the end smelling like a rose.
The rest of the world not so much.
The remainder of the book looks at a number of different countries and their challenges, and how they might fare outside of Pax Americana. It’s not pretty. No countries have all of America’s advantages and many countries have age demography challenges more severe than the United States- including Canada, China, most of Western Europe, Japan and Russia. Other regions, like the Middle East, have already begun wars that won’t likely stop anytime soon. If you posit a return to a dog-eats-dog world that existed for most of human history before the imposition of Pax Americana (Zeihan does) the possibilities for armed conflicts are almost limitless. The United States, a defacto continental sized island of prosperity, need not involve itself.
A few years ago I would have thought Zeihan’s global pessimism overwrought. Now I can hope that this is the case, but I am not so sure. A few years ago I would have also thought that it was highly unlikely that the United States would have drawn a “red-line” in a Syrian civil war only to change our minds, and then watch a massive refugee crisis strain European unity and contribute to the departure of the United Kingdom. Or that Russia would start the process of reacquiring their Soviet era buffer states. Or that the United States would effectively abandon the interests of their long-time Middle Eastern allies like Saudi Arabia and Israel in favor of Iran.
All of these things however happened, and it seems to be a good bet that there is more global chaos on the way. Whether or not it unfolds as Zeihan foresaw writing back in 2014 or not remains highly speculative, and there are some more optimistic scenarios than a fast return to international anarchy. Since 2014, American oilmen decisively defeated the OPEC attempt to crush fracking by adopting new technologies and practices that decisively lowered the extraction costs of American tight oil. It’s not going anywhere.
Written in 2014, many things about the Accidental Superpower seem to foreshadow Trump. Trump claims that the United States has signed a huge number of “stupid” deals and that he will strike better deals. While I’m not saying I agree with this sentiment at all, Zeihan’s book does add a new perspective, at least for me. It also makes the choice of the former CEO of the world’s largest oil company to lead American diplomacy even more interesting.
I hope that Zeihan’s global pessimism proves over done. Take the Trump administration’s reading the riot act to our NATO allies regarding their defense spending for instance. If the hobbits of euroshire don’t toughen up pretty quickly, they are going to find themselves unprepared to deal with the legions of orcs heading their way as a fading but desperate Russia grasps at lost buffer zones. Of course this is easier said than done on a continent of stagnant growth, debt crisis and aging populations but failing to deter Russia could prove far more costly. Half of the American Baby Boomers will have reached retirement age by 2020, the United States may soon as Zeihan postulates view this as someone else’s problem. A German army with 63,000 people in uniform does not seem likely to get the deterrence job done, and if you were a Baltic state or Poland you should have your alarm set at “Red Alert.” If the United States can avoid a precipitous cut off, it may be possible for the Europeans to deter aggression on their own.
Similar transitions may be possible elsewhere, but a Saudi-Iranian barely cold war seems already locked in to consume the Middle East for a long time to come. The Congress lifted the ban on oil exports in 2015, and the United States already exports a million barrels of oil per day. Reading Zeihan raises the question of just how long the United States Navy will be protecting the shipping of foreign firms in direct competition with American firms for market share. Indefinitely? Friendly tip- if I were Europe or Japan I would start signing long-term oil and gas contracts with American firms like yesterday. The United States is going to have an interest in protecting its own shipping even in the Zeihan return to anarchy scenario, and other suppliers lack the political and military stability of a Texas or North Dakota.