Plain English with Derek Thompson - Why It Seems Like So Many Countries Are Falling Apart

Episode Date: July 22, 2022

The world is kind of a mess right now. There is a big, bloody, awful war between Russia and Ukraine, which has hugely disrupted global trade, especially in commodities like oil, wheat, and natural gas. Europe is on fire, and the euro is crashing. Boris Johnson is out as the U.K.’s prime minister, and Mario Draghi has resigned as Italy’s prime minister. There are tremors in China, as the world’s second-largest economy fumbles through a ridiculous COVID-Zero policy. In Sri Lanka, crowds stormed the presidential palace after an economic crisis. In Japan, a former prime minister was assassinated. In Turkey and El Salvador, inflation and kooky economic policy has led these countries to the brink. Is this just random chaos, or is there a deeper story to tell? Today’s guest is Ian Bremmer. Ian is a political scientist and the founder of Eurasia Group and GZero media. He is also the author of several books, including his latest: The New York Times bestseller 'The Power of Crisis.' He takes me on a geopolitical catastrophe tour. In the end, we consider the meaning of this moment in history—and why this feels like the end of an era and the beginning of something new. Host: Derek Thompson Guest: Ian Bremmer Producer: Devon Manze Learn more about your ad choices. Visit podcastchoices.com/adchoices

What's up, everybody? Are you tuning in to the Challenge USA on CBS? Well, tune in to me, Tyson Apostle, as I break down each and every episode with my co-host, Amelia Weddemeier. I'm also a contestant on the show, which gives you all the insider scoop. Amelia, how stoked are you to do this? Tyson, I'm freaking excited. I cannot wait to sit my butt down every single week to watch the show, then come here and recap it with you on the Ringer Reality TV podcast. Today we begin with a letter from a listener. This is Samantha from Vermont. Quote, I think I have an idea for your show.

It seems like a lot of countries are falling apart. Recently, England, Italy, and Sri Lanka have just gotten messy and unstable politically. Is there something going on other than all the obvious the world is just a mess? Hope this helps. Good luck. Samantha. And quote. Folks, Samantha is really on to something here.

Actually, if anything, she was downplaying the messy state of the world in that letter. We can start with the obvious. There is a big, bloody, awful war between Russia and Ukraine, which has hugely disrupted global trade, especially in commodities like wheat, oil, natural gas. It's fed a global inflationary crisis. Then he gets the slightly less obvious, which is that it's caused an energy crisis throughout Europe,

which could certainly use electricity, to power air conditioning, considering that the southern half of that continent is on fire, and the northern half of the continent is basically one giant swath of 100-degree temperatures this week. And this energy and climate crisis has compounded all sorts of political chaos. The UK's Prime Minister, Boris Johnson, is out. Italy's Prime Minister, Mario Draghi, has resigned. Note, the conversation you're about to hear actually happened in between Mario Draghi

offering to resign and then actually resigning. This is how dynamic the resignation situation is with European leadership at the moment. But that's just the tip of the iceberg when it comes to global instability. There are tremors in China as the world's second largest economy fumbles through its brain-dead COVID-Zero policy, its bizarre crackdown on tech, a housing crisis. In Sri Lanka, crowds stormed the capital after an economic crisis brought that country to its knees. In Japan, a former prime minister was just assassinated. In Turkey and El Salvador, inflation and in kooky economic.

Islamic policy led both countries to the brink, Samantha's dead on. The world is a mess. Today's guest is Ian Bremmer. Ian is a political scientist. He's the founder of Eurasia Group and G-Zero Media. And he's the author of several books, including his latest, The New York Times bestseller, The Power of Crisis. Ian, in this episode takes me on a geopolitical catastrophe tour through Europe's energy market to China's demographics, to El Salvador's Bitcoin experiment, to Sri Lanka's everything. And in the end, we consider the meaning of this moment in economic history, in geopolitical history, why this feels like the true end of an era

and the beginning of something else. I'm Derek Thompson. This is plain English. Ian Bremmer, welcome to the podcast. Eric, good to be with you. So I feel like we're seeing these scattered, nervous breakdowns around the world, and I'd love you to help me

understand and unpack some of them. And then after we do a tour of this sort of global mess, I think maybe we can pick out a couple of themes that we're seeing, because while it's conceivable that every unhappy country is unhappy in its own way, I think that some of these scattered political economy, nervous breakdowns are actually connected and that there is an underlying theme here. I completely agree with that.

Fantastic. Okay, good. So we're on the right track. Let's start with Europe. And maybe a good place to start here is the news that has some American travelers cheering and some American multinational companies worried, which is the euro is plunging. Great news if you're an American family by a pool in Greece. The Spanacopoda is cheap.

This is bad news if you're trying to sell stuff to Greece. And it seems to reflect bad news about the entire continent. So why is the euro crashing and why does it matter? Well, the Spanacopoda has been cheap for a long time because, I mean, you know, even within the Eurozone, Greece has been its own trouble point. But, and I just felt like repeating that because I was, you know, excited about, about you getting right into local flavor. But the Europeans are, when you have this kind of global instability and volatility, you get a flight to quality.

You don't, you know what they say? Risk on and risk off behavior. People are engaging in risk off behavior. They are more concerned about ensuring that their money is safe and less concerned about how big of a return they're necessarily getting. And in that environment, the United States dollar and the U.S. as an economy becomes much more attractive writ large. Europe is more vulnerable particularly because with a war going on on the European continent, this is, remember, I mean, we had a peace dividend for 30 years. When the Soviet Union collapsed, there was a view that the Europeans no longer had to say. spend on defense and instead could focus on social contract and democracy and rule of law and all sorts of things that make European societies attractive, but not really focusing on defending

themselves. Well, I mean, now, not only are they going to have to devote an enormous amount of money towards spending and building up the defense capabilities they've ignored for 30 years, but also they are physically cutting off Russia from the G7, the advanced industrial democracies, the economy. Now, it's true, the Americans are sanctioning too, but we had virtually no trade and investment ties to Russia. When the Russian oligarchs are getting hit, where do you think they were summary?

It was mostly on the Spanish coast and on the Riviera and how many of them have sort of massive have mansions in London, they were talking on EU, but Europe, but still this is a big hit for the UK. Then there's also, of course, the direct trade, the agricultural trade, and particularly the energy export. And the energy export, I mean, to the United States, there was a marginal amount of oil from Russia coming to the U.S. It was irrelevant to the U.S. economy. if the Russians completely cut off energy to Europe or if the Europeans cut it off from Russia, you're looking at an immediate contraction of probably 3% of the entire Eurozone.

And so even though that hasn't happened in entirety in Toto, there have been major disruptions already. There have been significant sanctions already. And if the Russians know that the Europeans are trying to do that. diversify away from Russia as fast as humanly possible? If you're Putin, are you going to sit there and wait until the Russians, until the Europeans cut you off, or are you going to take some of that leverage when winter is coming and you can cause more pain, and you can maybe get something for it politically?

You can get anger on the European streets against European leaders that have been calling for sanctions against Russia. Putin's not stupid. He may be intemperate, and he may lack judgment, but he nonetheless understands where his leverages. So all of those things are playing into a euro that has lost a significant amount of confidence from investors around the world over the last four months. And I'm not the sort of person who believes in karma, but there is something at a sort of geopolitical level that is karmic about this. The Europeans making this deal with the devil or this deal with an autocrat in terms of

their dependence on Russia for energy and then waiting until the moment that Russia invades Ukraine, and saying, oh, no, we suddenly are going to take a moral stand. We're going to cut you off, exposing themselves to this level of blowback from Russia, which, as you just said, could, according to the IMF, cause a recession as deep as 3% of GDP for the entire EU. It's really remarkable looking across EU statistics, just how bad things are. It was just reported this morning that Eurozone consumer confidence plunged to its lowest level on record. Energy prices, obviously, are absolutely ghastly right now, which some. If, you know, for AC units, temperatures are over 100 degrees in much of the continent, that's

really difficult. I want to ask how this connects to the political headlines that we've seen in the last few weeks. So the prime ministers of the UK and Italy both recently announced their plans to step down, Boris Johnson and Mario Draghi. We'll see if they do. Draghi and Italy has walked back his announcement to resign. There's lots of fear in Germany about a major recession. How much of these sort of political instability that's happening in Europe and the UK right now

do you think is primarily about inflation and energy versus about something that's just locally strange about those political institutions? I think that in the case of the UK, it really has been the domestic scandals that are the, and there have been so many of them. I mean, Boris Johnson has just had a shambolic. period of leadership. He was the one, of course, that drove Brexit. It has been a dog's breakfast in terms of implementation, as well as the impact it's had on the UK economy, on labor outflows, on capital outflows, greater inflation in the UK than in the EU, challenges with trade access.

I mean, all of these things are deeply problematic for the UK. And then Boris Johnson has just been caught in lie after lie after lie. And unlike in the United States, in the United Kingdom, that actually matters politically. So, I mean, he's gone and he's not coming back. And in relatively short order, we'll have a new prime minister. In the case of Italy, there's no question that the economic challenges have made it harder. I mean, that is why you saw a willingness of the right wing in Italy to challenge Mario Draghi for economic reforms he's been trying to push through. And he then said, okay, well, if you don't have confidence, I'm out. And he said, I will come back, but only if you are prepared to completely support the

policy that I've been driving. And we'll see if they do. But, I mean, Mario Draghi is, I mean, he's a fantastic leader. He is unique in Italian governance in terms of the credibility he has across the Eurozone. and globally, but he is leading a very, very diverse group of parties in governance, and he's not going to be there for much longer anyway. I mean, at best, he gets another year, and then Italy is back to very, very messy, repetitive, you know, sort of year after year after year, different governments that can't do very long.

And an extremely unstable economy. I was just looking at the IMF, which came out with worst-case GDP scenarios, if Russia shuts down the gas supply to all of Europe. Of all the countries that I saw that would suffer from this, France's economy would project a decline by 1%, Poland declining by 2%, Germany declining by 3%, no one touched Italy, a projected decline of 6%. So you're looking at political leadership above an economy

that is incredibly fragile to what might be coming down the pike. Just one... Fragile and dependence, right, where France isn't, And France isn't in large part because you mentioned before isn't this karmic, not for France. Why not? Because France actually gets the vast majority of their electricity from domestic nuclear production. Now, they have problems right now because 50% of their nuclear reactors are offline for maintenance or for corrosion, which is a huge problem. There have been demonstrations and Macron's own government has lost popularity because of that. But it's not karmic because of dependence on the Russians.

as you say, a lot of these economies have shown that they have the ability to fail in their own unique way. One more country that I want to hit in Europe before we travel several thousand miles to the east. Germany. There's a lot of fear in Germany of a major recession. I've read a couple analysts saying that they're very concerned that the situation in Germany could turn very, very negative very soon. What are you seeing out of Germany that people should pay attention to? It's about gas and it's about winter coming. And the fact is the disrupting. that you've already seen from Russia to Germany in terms of gas has meant that they haven't been able to fill their reserves to the levels required that would give them some buffer if they get shut down in the winter. Now, I will tell you, the Germans are very aware of the challenges that they have. They weren't under Merkel. They are today. And they are doing everything they can.

If there is a lever that they can pull to reduce their dependence, increase their resilience, they are pulling it. They will be, they're diversifying where their natural gas comes from. They're signing deals with Qatar. They're getting some support from the United States. They're reconsidering their position on nuclear as well, it seems. I don't know how strong that. I think they'll probably extend the life of three existing nuclear plants as a consequence

of that. You never would have gotten that from the Greens before. They're taking greater measures on efficiency. They're trying to reduce industrial usage, but also from those companies that have more energy than they need. They're trying to paying them a significant amount to have them reallocated to the industrial companies like BASF and Siemens that desperately need it, can't transition. They're moving gas to oil in companies where that's possible.

And they're increasing their renewable energy use and infrastructure. They're doing all of this. It's not enough. And it's not fast enough as well. It's not fast enough. No, I mean, again, by 2024, the Germans won't need Russian gas anymore. So, I mean, from a Russian perspective, this is a disaster because all of their infrastructure, all of their trade had been oriented, right, towards the West.

And it is going to be cut off. And it's never going to come back. And their assets have been frozen. And it's a big problem for them. But in the near term, that's a long term issue. In the near term, the Russians are minting money because energy prices are high. and the Europeans using, in part, Ukrainian pipe, are actually funding the Russian invasion on Ukraine.

I don't want to be Mr. Sennyside up here, but there are a lot of very cold nights and very hot summers coming for continental Europe between now and 2024 or the mid-2020s when they'll establish a little bit more energy independence. But can you see a scenario where, say, 10 years from now, we look back at the Russian-Ukrainian war as an extraordinary inflection point

when it comes to the decarbonizing of the grid in Europe, maybe also the U.S., fingers and toes crossed. And this moment when people got religion in Europe and realized exactly how much they would have to build to stop relying on a crazy autocrat to the east and start building their own infrastructure. First of all, the Europeans were already ahead of the rest of the world in terms of decarbonization, in terms of moving towards renewables. and this is further stimulating that. Now, in the near term, the Germans are going to use more coal than they were last year. So there is going to be that blip, but 10 years out, 20 years out, yes, this moves them faster. But for the developing world, it does not. And, you know, the developing world, as you probably know, India has vastly increased their oil purchases from Russia at a 30% discount.

The Chinese have increased. They would increase it by a lot, only by a little, because they would increase it. their economy is not growing very much, so they don't have the same level of demand that they would have expected, but still it's increasing. And I would argue that actually, from the developing world perspective,

the Russia-Ukraine war doesn't help you one bit in terms of the movement's de-corporation. I had not put that together, honestly. I knew about China and India, basically buying the bulk of the oil that Russia wasn't selling to Europe and the West, and I was optimistic about the decarbonization prospects within Europe, but I didn't put that together,

that you're totally right. And the parts of the world that are growing fastest, that are most populous, this might not be a positive inflection point at all. That's very interesting. India's expansion of oil purchasing from Russia since the war started is 2,000 percent. Okay? I mean, it's from a low base, but they're now getting as much oil from Russia as the Chinese are. And their net zero plan, when carbon emissions go to zero in India, 2070, and they have literally no plan on how they're going to get there. This is the most populous country in the world. Let's go to the second most populous country in the world, which is China.

We just got a report out of China. And economic statistics in China are always take this with the grain of salt. But youth joblessness is up to 19%. That's a record. Shanghai's GDP last quarter collapsed. No surprise. The government put everybody under house arrest to stop the spread of COVID. You cannot have an economy when no one's allowed to go outside.

June home sales in China fell 23 percent. annually. You've talked about a blooming banking crisis in rural China. I mean, we haven't seen this. China has been growing so fast for most of the last 25 years that it seems weird to ask this question. But is China going into a recession? Is China in a recession right now? This year, remember, China back in 2020 was the only G20 economy that actually grew in the teeth of the pandemic when everyone else was suffering massively and rolling shutdowns. The Chinese lockdown in the first quarter hard by May. They were open. They were at work. They were at nightclubs. And the only other major economy that grew in the world in 2020 was Vietnam. Right.

So, I mean, let's also remember that they've had their upside. But they're now suffering badly because as the pandemic changed, their policy didn't change. And you can't lock down effectively track and trace effectively when you've got a disease that is as transmissible as measles. And especially when you have 80-year-old plus population that hasn't been adequately vaccinated. So China got complacent. And now they're suffering. Now, the willingness of the Chinese to suffer economically to ensure that they do not overwhelm their hospitals and have one to five million Chinese citizens dead is enormously high. And they will do that in 2022 and 23. And if that means that you get two or three years of deeply substandard growth. We could be looking at a two

handle on growth in China this year compared to the 5.5 to 6 that was expected by the Chinese and the IMF at the beginning of the year before the Russian invasion and before zero COVID became a massive problem. My God, you know, that's a very big deal. It's a big deal for the global economy. It's helping to keep energy prices lower, by the way. I mean, right now, markets are being driven more on oil in the last few weeks on the basis of China under growth expectations than Russia boycotts. Interesting. Yes. Which I mean, you know, actually made the Biden trip to the Middle East

a little bit less contentious and less problematic than it would have been if it had been a month, six months, six weeks before with oil prices, gas prices already coming down. But, you know, if we're looking at the challenges that the Chinese have for zero COVID, for reduced productivity, with a population that is now shrinking according to the latest data from the Shanghai Academy of Sciences, which I found very startling. This was a report that came out. 10, 15, 20 years, an actual shrinking of the population. So this is very worrying.

And we're going to hit population actually in just a second. Let me just jump in here because it's such an interesting point. I had not connected the fears of Chinese recession as directly to the decline in oil prices. But of course, it's enormous source of demand for oil. so as their prospects for growth decline, so will the price of oil. In the last year, you mentioned this. China's pursued a bunch of policies that strike me as very strange individually and borderline crazy in the aggregate.

You mentioned that they're pursuing this extreme zero COVID policy in a world where the variants just keep getting more transmissible and we're now at measles level of transmissibility. I've compared this before in another podcast to like COVID zero is already a very hard policy. This is already like trying to scale Mount Everest. And doing COVID-COs, without the MRNA vaccines is like trying to scale Everest and saying we're to do this with oxygen masks.

Like not only is it incredibly difficult, but also you're taking away your single best tool in order to approach it. They don't want their hospitals filling up with seniors that are dying and have severe illness. Of course, I wouldn't want that for any country. I don't want it for ours. But the single best tool that we have for reducing severe illness for the elderly is MRNA vaccines, which were developed in the West, so it might be a little bit of geopolitical competition there.

and antiviral drugs like Paxlivet from Pfizer. That has done a remarkable job in the U.S. of bringing down the fatality rate. So you have that incredibly strange policy, and you compound it with this bizarre crackdown on the consumer internet. My friend Noah Smith has written a bit about this, but this has involved going against companies that were really some other global darlings like 10 cents. It's involved disappearing several prominent tech billionaires

in a way that certainly can't be good for encouraging other smart people to move to China and start companies. there? Like, why would I want to start a company somewhere where success carries that level of risk? In the biggest picture here, I've made the table rather full, what does it say about China's state capacity, about its capacity for decision-making in Beijing, that it's pursuing such bizarre strategies that are affecting their growth this way? Well, I will say that the Chinese Communist Party and its leadership is much more meritocratic in orientation than you see. from most authoritarian states.

I mean, in Russia, if you go and meet bureaucrats that are senior in various ministries, they are some of the least capable you would see in any economy remotely close to that size. It's a disaster. In China, that's not true. These are people that are very capable. They are well-educated. They have management experience. They have been proven to succeed in lower-level positions of executive authority,

and that allows them to become promoted. So, I mean, they do have human capacity inside the leadership of the party. They are aware of a lot of the major economic challenges that they're confronting right now. But they have a very different view of the tradeoff of economic growth and productivity with political stability of the country. So, for example, one thing you didn't mention in terms of China's crackdown on consumer internet, and I thought you were going there, is they decided that they were going to not allow under 18-year-old Chinese to be on video games for more than two hours a week.

And you don't use them, you lose them. And first they had password systems, but people were getting around them. And then you had to input like your national ID. And then you were bothering your brother or your sister. And then they use biometrics. And now it's working. And I got to tell you, there are a lot of parents in the United States and in Europe that wish the United States had done. kind of political capacity. Because, I mean, it is, let's face it, it's not a productive way

for young people to spend time. It can create a lot of addiction, a lot of unwee, a lot of concerns of self-insurity and a lot of suicide. And the Chinese have decided they're just going to take that on. Now, they're doing that, not caring, that there are a number of big companies out there, both Chinese and American and global, that just aren't going to have a market in China anymore. And China's perspective is, we don't care. We're going to ensure that we are focusing on the people. And, you know, there's zero COVID policies very similar. It's like you only have 2% growth. We don't care. You, the Americans and the Europeans, have allowed a million Americans and Europeans that you tell us have died. And in reality, the economist says it's probably

more like three to five million in both places. So, I mean, the Chinese look at that and they say you don't value your elderly, you don't value you're sick, you know, you sheath that in the ideology of personal liberties, but in reality it's irresponsible. And we, the Chinese, we do care. Now, that argument goes only so far. It is a real argument, and I'm pushing back because you didn't offer any of it. But there is at the same side the fact that the Chinese have access to Western mRNA vaccines and refuse to license them. And that is a crime against humanity in my view. I mean, literally, I mean, I think it's worth putting it. It is a, it's a crime against the Chinese people. And they also have absolutely in arbitrary and capricious ways gone after

technology leaders in China because they have found them to be acting in ways that counter the orthodoxy of Maoist Shi Jinping thought. And they won't tolerate it. And if that means that the economy isn't going to grow as fast and you're not going to get as much innovation, so be it. They don't care. They prioritize these things differently. I will say that China is also at the same time investing a ton of money into semiconductor

development, a ton of money into national champions driving artificial intelligence applications for smart cities, a ton of money into sustainable technologies for energy like solar, electric vehicles and batteries and the supply chain. That's so much so that the Americans increasingly worry that the U.S. is going to fall behind and China might become the post-carbon energy superpower. So there are competing narratives here. And for all of the ways that the Chinese government desperately falls down, there are huge political dysfunctionalities in the United States. as well that you and I could do a whole different part on. It's an absolutely fascinating balancing of virtues,

because the U.S., as you mentioned, has an entirely different attitude toward personal liberty, toward the concept of freedom. So, of course, Americans value health, Americans value psychological health and the happiness of our youth. But we don't go to the extent of, say, shutting down a city like Shanghai

for that amount of time with that level of draconian, precision for the purpose of preserving health. We don't go to the extent of using biometric data to ensure that people under the age of 18 don't get addicted to video games. It's a very interesting different balancing of virtues. And I think it's interesting to see it that way. The last question that I have for you about China is about demographics, which you've already mentioned. China is running all these experiments in the foreground, you could say. The consumer internet crackdown is an experiment. The biometric access to gaming is an experiment. Zero COVID is an experiment. And then in the background, they're running the mother of all population experiments.

In 1990, China had four times as many children under 10 as people over 60. Four times as many children under 10 as people over 60. By 2050, that ratio is expected to flip exactly. China is projected to have four times as many people over 60 as children. under 10. This sort of demographic somersault has simply never been done before, I think, as a species. It's a total inversion, a population boom slamming into a fertility crash. How worried are you about this potential demographic crash in China and then potentially its triple effects throughout the world? I'm reasonably worried. I also think it creates opportunities. I mean, there's no question that if you want a more sustainable planet, at the macro level,

you don't want to head fast towards 10, 11, 12 billion people. And, you know, Africa's population is still exploding. And a significant contraction in China's population will help to counterbalance that for global sustainability long term. That does matter. Right. I mean, if you want to be at 1.5 or two degrees centigrade warming as opposed to 2.5 or 3, you're talking about the difference of hundreds of millions of lives, and you're also talking about tens and tens and trillions of dollars, and that matters. So, I mean, China's demographics do feature into that. I also, you know, there's a question. Japan is navigating and South Korea is navigating a population contraction pretty well, but these are very wealthy countries that also have very robust social safety nets.

and they have relatively limited inequality in their populations. China is going to have to navigate an even more sharp contraction of their population as a middle-income economy with much less of a social safety net, but with much more capacity through technological surveillance and repression to offer carrots and sticks to induce behaviors in their population that would facilitate more alignment with the government. So they do have, by virtue of that, more of a buffer against political instability, even as their economy starts to collapse or shrink or flatten out, depending on how, you know, sort of dire you think these scenarios are compared to the United States that has a very robust economy, but has a completely imploding political system. So it's, again, a very different dynamic between the two countries going forward.

Now, I do think that if you're talking about the worst case that you saw from Shanghai, which is that actually the Chinese don't max out in population in 2028, which heretofore had been the expectation, but rather they maxed out last year and they contract, and that contraction grows, and it doesn't matter that you've moved to a three-child policy from a two-child policy from one-child policy, and it's going to be very hard politically for them to open.

up to massive immigration, culturally, they've been very opposed to it for a very long time. But if all of those things remain true, then one thing I will tell you is that there is no Chinese century. A second thing I will tell you is that it's quite plausible that China never becomes the largest economy in the world. I mean, they might normally for a period of time for a few years, but the idea that everyone had presumed that, you know, come 2028, 2030, whenever it is, they become the largest economy, and then it's off like a rocket. And then they're just going to literally dominate the global economy. If they're heading towards 500 million people in 2100, which is, by the way, roughly where

the United States is likely to be at that point, you were not talking about a China-dominated global economy. It's just not remotely close to being where we're headed. That's such an interesting way of thinking about it. Do you see that the people that you talk to, when they're Americans and they look at it, look at the likely shrinking of the Chinese population and the fact that there will be no Chinese century, that there will be no long epoch where China is the most powerful country in the world, does it make them optimistic about the U.S.? That the U.S. will still be the big gorilla in the room

that's able to dominate the global scene, to have the largest consumer economy that people want to sell into or immigrants want to move to? Or is there a kind of fear that, like, that as China recognizes that they are sort of at the twilight of their rise, that they might start to act out. They might start to do things to reclaim the vision that they thought they were entitled to when people were talking about China as the inevitable King Kong of the world. Like, do you see it going either way or do you have like a clear sense that there's one direction it will go. I think it depends so much on the leadership of the country. I mean, you know, the level of risk acceptance of a Putin compared to Xi Jinping is significant. I mean, I think if

Xi Jinping had been occupying the Kremlin back in February, you wouldn't have had all those troops streaming into Kiev. You instead would have probably had a decision to just go into the Donbos in response to the claimed genocide against the Russian people. And they probably would have won that incrementalist, you know, sort of land grab, a very different kind of revisionism on the geopolitical stage. So I don't see Xi Jinping as the kind of leader that's suddenly going to roll the dice on an amphibious assault into Taiwan that puts at risk the core semiconductor producer not only for the United States, but for China too. Again, risking the complete implosion of their economy and also Xi Jinping's leadership

and legacy. I think it's very unlikely he would do that. But might he feel the same way in five or 10 years time absent term limits if China's economy is doing materially worse if major social unrest starts to become a significant issue? Or is the dominance of a Chinese surveillance society empowered? by the technological sophistication of these companies that are aligned with the government in providing data to real-time data to the Chinese government,

does that allow the Chinese government to feel insulated from political instability? I mean, you know, I remember reading Tom Friedman 20 years ago, 15 years ago, talking about demonstrations in China and saying that this country is going to collapse because the people are going to be so angry. Well, that just didn't happen, not even close. And I mean, you know, they literally put a million Uyghurs into concentration camps. And you don't see major demonstrations among the Uyghurs that aren't in concentration camps because they are existing in a panoptica.

And so I think we shouldn't underestimate the power of the Chinese state to ensure their political survival even through what is likely to be a very deeply challenging economic period. Beyond China, I'm looking at some of these countries that are suffering. a bunch of different kinds of economic crises. To name a few, we've got Sri Lanka, import-dependent country, ran up massive debt and just had enormous demonstrations at their capital. There's Turkey where inflation is soaring right now. There's El Salvador, which tried this weird thing with Bitcoin

that might not even be worth going into to help sort of spring their economy, but that has not exactly worked as the price of that cryptocurrency is declined by 70%. When you look at the problems that various countries are having, having, it seems somewhat related to, it seems to me, rising global inflation. Do you see these kind of economic crises as being tied together by some theme of 2022 economics? Or to a certain extent, are we just seeing business as usual on the global scene? That there are always countries that are rising and falling and crashing.

No, it's obviously a period of much greater volatility right now. and the developing countries are shouldering a much greater level of that burden. Now, part of that was the pandemic and the whipsaw lockdowns and then massive expansion of demand that led to supply chain challenges. That got you a lot of the inflation that we have right now. Now, if you are a major consumer commodities producing economy in that environment, you're doing well. I mean, the Saudis are swimming in cash right now.

And even though Lebanon's in a lot of trouble, they have the grace. of being close to a lot of countries that are making a lot of cash that are willingness to provide them more largesse. Egypt, also largely looking like there'll be a better bailout for them because they're going to get some of the crumbs that'll come from this explosion in fiscal balances in the Gulf over the last several months. But for Sri Lanka, you know, or for a Peru, you know, for a Colombia, I mean, these are countries that are, these are countries that are in Turkey. These are countries that are in a lot of trouble, and they're in a lot of trouble because, I mean, they had a really challenging two years of the pandemic where they had to dramatically

expand their fiscal outlays, which means their indebtedness went way up. They have to service that now in an increasing interest environment. Credit is getting more challenging for them, and yet their populations are suffering greatly because you've got food and energy inflation on the street. And this is how you get the Sri Lankan government, which was one of the worst in terms of economic mismanagement and corruption, they fall first, but there will be others. And lots of these countries are under an enormous amount of pressure right now. Last part of the world that I want to talk about, you've mentioned it before, but I can't let you go before I ask this question, the Russian-Ukraine war right now. It seems to me, I haven't followed it really, really closely for several months,

and then only somewhat closely for the last few months to be a real stalemate in the Donbos, a real stalemate in eastern Ukraine. And I can see one scenario in which President Zelensky of Ukraine essentially makes a determination that he can throw tens of thousands of people into the Donbos, but fundamentally, there's not going to be a whole lot of movement one way or the other. And so maybe that'll draw them to the negotiation table

to find some kind of deal. or maybe this is a kind of, you know, trench warfare for the 21st century outlook where Ukraine doesn't want to give up territory. They're too proud. Putin has already put way too much on the line to draw back. And it just continues like this, death after death after death, even though no one really moves the line of who's controlling what in eastern Ukraine. Is there a particular outcome here that you consider more likely? I think that, look, I've spent a lot of time on this issue over the course of my life. So I've met with a lot of Ukrainians over the last few months.

And, I mean, I will tell you that they feel as if they are going through a genocide. I mean, that the Russians have attempted to wipe them off the map. The millions of refugees, the hundreds of thousands of Ukrainians that have been forced through filtration camps in Russia, the tens of thousands of war crimes, the torture, the rapes, the killings. of innocent civilians, not just of combatants. I mean, you have to understand that for 44 million Ukrainians, this issue will scar them as the most important of their entire lives. And so the idea that they are somehow then going to sit down

and negotiate away a large part of their territory to the Russians who have a massive military, and they fully expect will come back for another. that ain't happening. So I don't believe that you're going to get any form of breakthrough agreement in negotiations. I agree with you that we're heading towards for the near-term future, something that feels like a frozen conflict because the Russians haven't done a general mobilization. They're just going to run out of troops. And the Ukrainians don't have the capacity to seriously take a lot of territory back. So I'm 50-50 on whether the Russians can take all of the Donbos. But whatever piece of the Donbos they

take, plus the land bridge to Crimea, you know, plus, you know, say, Hirsson and Zaporizia. I mean, these are territories that they will continue to occupy. They've been utterly destroyed. They've largely been denuded and depopulated of the Ukrainians living there, and the Russians will likely annex them. Once that happens, it is inconceivable to me that you can create a peace in the foreseeable future with Ukraine, and it's also inconceivable to me that Russia can be brought back into the community of nations among the advanced industrial democracies. So, I mean, Ukraine is a loser here, of course, because of what they've had to go through. But Russia is an even bigger loser, and it's important to recognize. Right. Both losing lots of people, Ukraine is very likely to

lose land, at least some land, Hursan, elements of the Dombas. But you're right. In the larger geopolitical picture, Ukraine, to a certain extent, has become significantly more folded into the European continent, into the EU, economically integrated in a way that for Russia, exactly the opposite is true, more alienated politically, more alienated economically. And it's not entirely clear to me, though, answer this question, it's not entirely clear to me how Russia's relationships with countries like Iran and China have evolved because of this conflict. Have there been major changes in Russia, sort of, you know, joining what Ann Applebaum at the Atlantic has sort of discussed is sort of, you know, the league of autocrats, has their standing in that league

changed dramatically because of the last six months? It hasn't changed dramatically. The developing world across the board, whether autocratic or democratic, continues largely to do business with the Russians the way they have. And if commodities are cheaper, they'll buy more. Though I mentioned, while India is buying a lot more oil from Russia, they are cutting some of their defense agreements with Russia because they understand that Russia won't be able to provide spare parts, that Russia's going to have a real deficit of semiconductors, they won't have a manufacturing capability, they're losing a lot of talented labor. And so, you know, Russia had been the second largest military exporter in the world after the United States. That just won't be true in three or five

years' time. So that's a problem. But Russia's relationship with China is a relationship of very unequal partners. Russia's economy is about one-tenth that of China. And China treats Russia that way. So, I mean, they're happy to have access to cheaper stuff, but the Chinese want to continue to do business with the Europeans, the Americans, the Japanese, and the rest. These economies are very integrated. And so the Chinese are not breaking Western sanctions on Russia. They're not providing direct military support for the Russians, the way the Iranians might be, because the Iranian worldview and the Russian worldview are virtually identical. Both of these are prior nations for the West that have been very, very heavily sanctioned,

basically severed from the G7 economies. That's not true at all for China and isn't going to be. So in that regard, I would say there are limitations to how close they're going to get. Last question for you is about the theme. What is the theme that we're talking about? And if I'm taking the biggest picture, the alien's eye view of the last 50 years,

I'd say the last half century was defined by a period of globalization, reduction in poverty, the emergence of a global middle class that was disproportionately Chinese. But with the pandemic, with the Russian war, with the threat of China becoming a little bit more authoritarian, valuing a certain definition, as you put it, of political stability over an expression of human freedom, high levels of inflation, certainly that for the next few years, we'll see what happens for the rest of the decade, various forms of populism cropping up. Something is changing. We seem to be at some kind of inflection point for globalization, even if it isn't totally obvious that global trade is

absolutely falling off a cliff. How would you characterize the era that we're going through right now? Yeah, I would say we've gone through after 50 years of globalization being led by the United States and its allies, you now have a period where globalization

is a drift. It is not being unwound, but it is a drift. So the United States, I mean, you continue to see pockets of global And then you see pockets of de-globalization. So, I mean, under Trump, for example, you had increased tariffs against the Chinese, but you also had the phase one China trade deal. You had increased tariffs against the Europeans, but you also had USMCA, which is a more advanced trade deal than NAFTA was. You had the U.S. South Korea deal got done, but you had increased tariffs

on Canada. So, I mean, actually, the net net between the Trump administration was, you They got out of TPP, but they did some other stuff, was probably maybe a little bit more net globalization, I would probably argue, but not much. And under Biden, I see similar things. You know, I mean, I just saw a trip to Saudi Arabia, which was, you know, trying to engage more with the Middle East, not last. I just, you know, after saying he wasn't going to do that, they can't do market access, but they're promoting an Indo-Pacific trade framework, which actually does create more alignment on common standards, climate, on technology, on data. I mean, I saw the reduction in tariffs on steel and aluminum between the Americans and the Europeans. I haven't seen very much on that front with the Chinese. So, I mean, this is not a story of de-globalization. De-globalization would be the United States

ripping up deals. It would be the United States not just saying we want made in America, but actually doing it, right? That's not happening. What's happening is you went from 50 years of the U.S. and allies driving more market access, more global economic integration, you know, more efficiency. And as a consequence, a growing global middle class, to one where no one's leading it. No one's steering it. That's what's happening. It's globalization adrift. That's where we are right. And if this is the U.S. no longer driving globalization, but allowing it to sort of flow in an adrift manner, is the reason why we took our hands off the steering wheel, so to speak, is it because of a kind of homegrown skepticism

about how much globalization was really working out for the middle class of the Rust Belt? Was it a sort of skepticism about a disposition toward openness in the world? The sort of preference for America first, the sort of aesthetic preference for America first, rather than an openness to ideas outside of America. What's the motivation for? Trump's America first and Biden's foreign policy for the American middle class fundamentally speak

to the same issue. I mean, both sides of the political spectrum understand that you're not doing multilateral trade agreements in this environment. Why? Because the U.S. has the highest level of inequality of any of the G7 economies. Because for 50 years, you had the growth of an extraordinary global middle class, which is a great thing. And you had a great increase of wealth in the top global 1%,

that the United States at a macro level did very well. Shareholders did very well. But that the middle class in the U.S. and in France and in the UK and in so many wealthy countries around the world basically got hollowed out. That's how you got Brexit. And that's how you get the United States saying we no longer want to be the architect of global trade. We don't want to be the policeman for the world. We don't want to be even the cheerleader of global values.

that is a direct consequence, not of globalization failing, but of policymakers in advanced industrial democracies refusing to take steps to redistribute wealth inside their own countries on the basis of some of the inequality that was driven by globalization. Ian Bremmer, thank you so, so much for flying me around the world and explaining all this mess that's happening. I really appreciate it, and we'll have you back very soon.

Have to be with, Derek. Thank you very much for listening. Plain English is produced by Devin Manzi. If you have a comment, a concern, a question, an idea for a future show, please email us at plain English at Spotify.com. That's plain, no space, English at Spotify.com.