The Peter Zeihan Podcast Series - Does Size Matter? Exploring the Geopolitics of Micro-States || Peter Zeihan

Episode Date: June 24, 2024

Micro-States like Monaco and San Marino aren't often included in major geopolitical discussions, but every so often they get called up to the big leagues. Next up to the plate: San Marino. Full Newsletter: https://mailchi.mp/zeihan/exploring-the-geopolitics-of-micro-states

Hey everybody, Peter Zeyne here coming to you from the hills above Monaco and San Marino. Monaco is one of the microstates here in Europe. Pretty much they're all in Europe, no other thing about it. And I'm not talking about here like small places like Luxembourg. I'm talking about microstates that are just a few square miles. Monaco here is under a square mile itself. It's like the smallest state in the world. The existence of microstates is kind of a weird little story.

Basically, you get a geography that is rugged enough that little patches can be. carved out and they're difficult to access from other places. So for example Lichtenstein is in occupies a specific mountain pass between Austria and Switzerland and either they've been able to be tough enough to conquer that you leave them be or they're useful as kind of a diplomatic go-between. In the case of Monaco it traded hands a lot from the post-Roman period into the Italian Civil Wars and reunification ultimately into World War II and ever since then independence.

And now, of course, Monaco is most famous for the Grand Prix, which plays, well, by the time you guys see this, it'll already be over, and gambling. Basically, if you've seen James Bond, you've seen Monaco. It's also, I can say this with authority. Great place to have lunch. Microstates rarely play a big role. I mean, they're micro. But every once in a while, a certain constellation of factors comes together. makes them really matter. So the one that matters right now is San Marino. Now that's not here in France,

that one is down in Italy. But during the Ukraine war, the Russians have discovered that most of their normal avenues for intelligence gathering have been shut off. Because instead of just having the Americans go after their spies, everybody in Europe did at the same time. And one of the things you normally do when you have a spy is if you get caught, you just redeploy them somewhere else in the world. Well, when something like two-thirds of the Russian diplomatic corps and spies were declared person and on ground in some form, everyone started exchanging biographical information on all the agents. And so you could no longer deploy those people anywhere in the world unless you had a government who's like, oh yeah, we're okay with a bunch of Russian spies, that's fine.

And that doesn't happen. So basically something like half the roster of Russian intelligence agents got vaporized. And they're going to have to be deployed for other things. San Marino comes in because San Marino has been a location where some of these people are getting recycled. And in addition to like the normal money laundering things that Microsoft States are famous for, San Marino is now providing diplomatic cover for the Russians to get whoever they want into the European Schengen zone, which is the free transport union that the Europeans have. So the Italians are starting to get a little agrode at San Marino for serving as this bastion for Russian intelligence.

diplomatic and financial power in the heart of their country. Hasn't gotten to the point now yet that they're starting to renegotiate forcibly some of the treaties that allow San Marino to function, but the Italians are starting to look at it.