January 7, 2022 • 14 mins
Our world remains uneasy, unsettled and unpredictable (mostly).
From Covid to the economy and political unrest both domestic and foreign--there are a number of fluctuating circumstances that could either evolve or devolve to the point of impacting our daily lives.
Ian Bremmer (The Eurasia Group) produces a thorough analysis of those political risks in the annual "Top Risks Report"
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
The Armow. We've been talking to a fair amount today,
as we have for a while now, and how unsettled
the world is in all kinds of different ways, the economy,
the world order, military situations, variety. There's this virus that
I've heard about. Ah, it's always great when we get
(00:25):
a chance to talk to Ian Bremer, who is the
president and founder of You Raise Your Group, a political
risk research and consulting firm whose job is to figure
out what's going on, not to please us politically, but
to protect its clients, etcetera. Uh Ian joins us, Now,
how are you sir? Hey, how are you men? Good
to talk to you, Happy New Year. Thank you Sam.
(00:45):
You Before we get started, we want you to know
that something you said on your last appearance on The
Armstrong and Getty Show has become a fan favorite. We
play it all the time, Michael, if you'd be so kind,
I thought we were going to play the long version
of it. Hell, do you people not talk to each other?
Rather be in Washington or in Beijing? Are be in
(01:07):
the United States? Right? I don't I don't know if
you recall saying that. And we've we wondered at the time,
like did was that a slip of the tongue where
you just excited? Did you forget we were on the air?
Did you think we're a college radio show? We were
just wondering what was going on? Did I thought I
thought that you allowed um, you know, sort of more
casual obscenities. We should. It's it's mighty hottest to promote
(01:30):
to allow bull s to be used on the air.
But now, yeah, we have millions and millions of podload downs,
podcast downloads, but it starts as a radio show. So anyway,
we are not sking you I and we are glad
to be chatting with you about the Global risk list.
It is compelling as always. Uh Now, as as former DJs,
(01:51):
we might want to count down to number one, but
let's just start with the number one. What what? What
is number one? This year? Number one? Number one? While
we've been living with this pandemic for the last two years,
so it's hard to throw it out, especially with the
gaudy number of cases that you know, seven fifty thousand
yesterday in the US, and it's assure as an undercount.
(02:13):
The name of the number one risk is no zero
COVID and what that means because you know we're focusing
on the whole year, is that Actually the biggest problem
is China um the country that did the best job
responding to COVID once they admitted to it back in
because they could test and trace, they could walk down,
(02:34):
they could quarantine. They're going to have an enormously hard
time dealing with the newest variant O maicron, because, as
you've seen from a bunch of Biden advisers the last
couple of days, we need to pivot to living with
the virus. We've got the therapeutics, we've got the vaccines,
and it's not about case numbers anymore. It's about hospitalizations
(02:55):
and depths. The Chinese can't do that, and they can't
do it number one because their vaccines don't work in
any way to stop omicron spread. Number two because no
one in China has actually gotten the virus yet, so
they have very low antibody levels and they're focusing on
stopping spread. So they will shut down a city of
thirteen million people with a handful of cases. They have
(03:18):
the ability to do it. The impact of that this
year on the Chinese economy and on the Chinese supply
chain to the rest of the world is going to
be really, really big, and no one's really focusing on
this yet, so that that strikes us as the biggest
problem out there. Okay, so you got to that at
the end there. That makes sense because while I'm I'm
not a horrible human being that doesn't care about people,
(03:40):
are not that concerned about how many people in China
end up getting COVID, the fact that it affects the
supply chain for the rest of the world. You think
that's gonna be a noticeable problem. Yes, the second largest
economy in the world, and it's the factory for the world.
And you know, if you ask Americans what they're most
concerned about right now and what's driving Biden's comparatively low popularity,
(04:02):
they'll say inflation. Where do you think that comes from?
I mean, you know, we've had real difficulties getting goods
from China. We've had real challenges with port facilities and
with containerships and the rest of that. That should get
fixed a lot faster if we're all able to live
with the virus. But if the world's second largest economy
(04:22):
and biggest producer of stuff that we need is actually
locking down like crazy all year and by the way,
you know, they won't even license western m RNA vaccines
like you know Fizer and Maderia. They're waiting for their
own Chinese mRNA vaccine, which they're pushing hard. But it's
not going read until the end of the year for
for big for big league population rollout. So is a
(04:45):
problem here, It's it's just really interesting. I'd say it is,
hey and not And I want to get too far
off of your your list of risk because we look
forward to it every year. But how big a deal
is it that we found out this year that she
is actually a communist. I mean he's not just like
a Putin style dictator who wants to be rich and powerful.
It would seem as an actual communists like reigning back
(05:05):
the you know, the successful businesses and sectors. In a
weird way, that seems like good news for us. Uh.
You know, the Chinese economy right now is more unequal
than even the United States, and for an ostensibly socialist country. Um,
that's a problem. And so what you have is she's
(05:28):
and thing acting like an authoritarian populist saying no, I
don't I don't care about jack ma, I care about
the working class in the middle class, and and and
that means I'm willing to take some hits in terms
of my private sector. So I don't know. If you
saw the Chinese government a few months ago said if
your kid you get two hours a week on video games,
(05:48):
you don't lose, you don't use them, they don't roll
over to the next week. You know a lot of
American parents that would love to put that in place too.
But the fact is that that that's basically, you know,
cut an enormous amount of wealth generation out of the companies.
He doesn't care. So I do think that that's going
to be a hit for a number of really, really
profitable Chinese firms. I want to be clear. That's very
(06:12):
different than say Chinese semiconductor industry, which they are putting
an enormous amount of money and they want to be
world class. That's very different from artificial intelligence and smart
cities and sensors and autonomous driving, where the Chinese want
their companies to be world leaders. So I think that
you may be over egging the putting a bit by
(06:33):
saying that this is the year we found out she
is a communist. Yeah, cut it out, ye over egger Um.
We could We could talk for the next month about China,
but let's move on to number two, which I found
so interesting, the techno polar world. The report says, the
physical world is a mess because no countries are willing
or able to provide global leadership. Digital spaces even more
poorly governed, do tell but we're so everyone is angry
(06:58):
at the big tech companies now because so much disinformation,
because there's so many challenges in terms of cyber at
tax and personal security getting hacked and critical infrastructure getting hacked,
and so you're hearing people say, well, government has to
do something about this. Companies. Tech companies are gonna get
(07:18):
richer and more powerful faster than governments can catch up
to regulate them. And that means more disinformation, more anxious populations,
more problems in in governance and elections. You know, when
you and I were kids, we would if you wanted
to figure out how screwed up we are, we would say, well,
it was either the way you were brought up, its nurture,
(07:39):
or it's your genetics. It's nature. Increasingly it's actually nature
versus nurture versus algorithms. It's you know, the it's the
virtual world and the way that kids are getting information
and connecting with people as intermediated by these algorithms driven
by tech companies. And you know we're doing that without
(08:00):
testing them on on anyone. First. You wouldn't do that
with the drug, you wouldn't do that with the GMO crop.
But we're doing that with literally the the thought processes
of the brains of our children. And I don't see
how that isn't becoming a much more significant ristmers society. Wow.
As a as a guy who's raising a nine year
old an eleven year old boy right now and dealing
with a lot of that, that is, man, that's a
(08:22):
heap and help on the stuff to think about right there.
That is really interesting. Well, you know that these the
executives from these companies don't let their kids on this stuff, right, So,
perhaps I'm an idiot because I thought, um, and and
about half the audience is saying, perhaps, um, I I
thought the US midterms is going to be fairly predictable
and probably not a great note. You disagree, obviously, that's
(08:45):
behind your list at number three, tell us what you're thinking. Well, look,
I mean this is in part this is because the
election is so critically important for UM, and in part
it's because the United States is fundamentally more politically dysfunctional
and divided than any of our major advanced industrial allies.
(09:06):
I mean, we've had elections in the last few months
in Germany, Japan, in Canada, they've all been fine, free
and fair. Will happen the next few months. In South
Korea grants no problem, we can. We can no longer
have free, fair, legitimate national elections in the United States.
The losing side thinks that they're illegitimate and stolen. And
that started in sixteen with the Russia collusion story. Hillary
(09:29):
Clinton didn't support it, but a lot of Democrats did.
It got much worse in because Trump himself pushed the
big lie and has been doing it very effectively with
his supporters for the last year. And now we're setting
up for the midterm elections where I mean, you know,
the Republicans led by Trump are very likely to take
(09:49):
the House, maybe the Senate, and key gubernatorial and state legislatures,
which are going to be critical for certifying the election
in So this is kind of a tipping point for
what is likely to be a much more problematic and
dare I say crisis cycles in the run up number
(10:09):
five on the list, skipping. Another China related topic is Russia.
There's a huge divide in the United States between people
who are critically interested in that and people who say
it's a border dispute in Eastern Europe. What the hell
do we care? Why should we care? Well? Um, we
care in part because the Europeans are our most important allies.
(10:30):
The trans atlantic relationship matters. Um. And we also care
because the Russians engage in a set asymmetric power efforts
to undermine us UH and weaken our trans atlantic relationship,
and and the incursions into Ukraine, the invasion back in
was a part of that. So Russia, look, they're making
(10:51):
a lot of money off of higher energy prices, and
as the winter is coming, the Europeans need Russian gas
and they're facing shortages. So this is high time for
the Russians to cause trouble for the West, and that's
why they put a hundred thousand troops on Ukraine's border.
We got together with the Europeans and said, if you
invade UM, we're gonna sanction you so hard. Your your
(11:14):
economy is going to be destroyed. And the question is,
are the Russians prepared to call that bluff in full
or in part. And if they if they call that
bluff in part, is it possible that the Americans are
on board and the Europeans are not and Biden looks
really weak and the relationship really blows up. I would
(11:34):
like to congratulate you for getting through this much without
any of your trucker language that nearly cost us our
FCC license last time. But um no, I mean, who's
who's going to think about the children? It's important exactly.
We were just talking about the op ed piece in
the Wall Street Journal today by a couple of think
tank experts about how Biden's got a tough decision to make,
(11:56):
like in the coming weeks maybe about Iran. Do you
rank that we're screwed on Iran? Can I say that? Yeah? Good? Um?
I mean this is the one policy, foreign policy that
Trump actually destroyed. Um. I mean, there a lot of
things Trump did to overturn stuff that Obama did, and
then we went back, so Paris Climate Accord, he pulls out,
(12:18):
we go back in nobody cares. Um. You know, he
says We're gonna leave the World Health Organization, the Middle
pandemic Biden recommits. Nobody cares. He leaves the Iranian nuclear deal,
which Rex Tillerson, you know that the Secretary of State
for a hot second actually said that the Iranians were
complying with Everyone supports us staying in the deal. He leaves.
(12:39):
Biden wants to get back in. We can't get back
in because the Iranians said, nope, we're we're fully We're
full speed ahead with our nuclear program. There are now
four weeks away from nuclear breakout capability, four weeks allied,
four weeks, four weeks in terms of highly enriched geranium stockpiling,
four weeks away from having the capacity to developing were weapon.
(13:00):
Do we strike them in a major military way the
way the Wall Street Journal op ed piece suggests, I mean,
certainly the Israelis will up their sabotage game, and the
likelihood that this becomes a military confrontation is going up.
This is this is a crisis that is now directly
on Biden's lab because the US unilaterally decided to rip
(13:24):
up the deal. We will have a link to the
Eurasia Groups two risk Report Top Risks two if you
want to look at the rest of it, And as always,
we can talk to you all day, but you have
a limited time. We thank you so much for the
inc We look forward to the next dance to talk.
Happy New Year, gentlemen, be good you two thanks. Four
weeks his number for when Iran has breakout? Are you
(13:48):
pooping me? So? If there's gonna be a military strike,
it's coming soon. Yeah. Hey, we know a lot of
Trump fans can't stand it. He he calls, calls him
as he sees him. He thinks Trump made some big
mistakes and he doesn't care who who's mad. We think
he's an interesting guy, so we talked to him. Yeah.
I think the Iranian thing would have turned out the
(14:08):
same way either way, but it's slight change in timetable
maybe honestly strong and yet
The Armow. We've been talking to a fair amount today,
as we have for a while now, and how unsettled
the world is in all kinds of different ways, the economy,
the world order, military situations, variety. There's this virus that
I've heard about. Ah, it's always great when we get
(00:25):
a chance to talk to Ian Bremer, who is the
president and founder of You Raise Your Group, a political
risk research and consulting firm whose job is to figure
out what's going on, not to please us politically, but
to protect its clients, etcetera. Uh Ian joins us, Now,
how are you sir? Hey, how are you men? Good
to talk to you, Happy New Year. Thank you Sam.
(00:45):
You Before we get started, we want you to know
that something you said on your last appearance on The
Armstrong and Getty Show has become a fan favorite. We
play it all the time, Michael, if you'd be so kind,
I thought we were going to play the long version
of it. Hell, do you people not talk to each other?
Rather be in Washington or in Beijing? Are be in
(01:07):
the United States? Right? I don't I don't know if
you recall saying that. And we've we wondered at the time,
like did was that a slip of the tongue where
you just excited? Did you forget we were on the air?
Did you think we're a college radio show? We were
just wondering what was going on? Did I thought I
thought that you allowed um, you know, sort of more
casual obscenities. We should. It's it's mighty hottest to promote
(01:30):
to allow bull s to be used on the air.
But now, yeah, we have millions and millions of podload downs,
podcast downloads, but it starts as a radio show. So anyway,
we are not sking you I and we are glad
to be chatting with you about the Global risk list.
It is compelling as always. Uh Now, as as former DJs,
(01:51):
we might want to count down to number one, but
let's just start with the number one. What what? What
is number one? This year? Number one? Number one? While
we've been living with this pandemic for the last two years,
so it's hard to throw it out, especially with the
gaudy number of cases that you know, seven fifty thousand
yesterday in the US, and it's assure as an undercount.
(02:13):
The name of the number one risk is no zero
COVID and what that means because you know we're focusing
on the whole year, is that Actually the biggest problem
is China um the country that did the best job
responding to COVID once they admitted to it back in
because they could test and trace, they could walk down,
(02:34):
they could quarantine. They're going to have an enormously hard
time dealing with the newest variant O maicron, because, as
you've seen from a bunch of Biden advisers the last
couple of days, we need to pivot to living with
the virus. We've got the therapeutics, we've got the vaccines,
and it's not about case numbers anymore. It's about hospitalizations
(02:55):
and depths. The Chinese can't do that, and they can't
do it number one because their vaccines don't work in
any way to stop omicron spread. Number two because no
one in China has actually gotten the virus yet, so
they have very low antibody levels and they're focusing on
stopping spread. So they will shut down a city of
thirteen million people with a handful of cases. They have
(03:18):
the ability to do it. The impact of that this
year on the Chinese economy and on the Chinese supply
chain to the rest of the world is going to
be really, really big, and no one's really focusing on
this yet, so that that strikes us as the biggest
problem out there. Okay, so you got to that at
the end there. That makes sense because while I'm I'm
not a horrible human being that doesn't care about people,
(03:40):
are not that concerned about how many people in China
end up getting COVID, the fact that it affects the
supply chain for the rest of the world. You think
that's gonna be a noticeable problem. Yes, the second largest
economy in the world, and it's the factory for the world.
And you know, if you ask Americans what they're most
concerned about right now and what's driving Biden's comparatively low popularity,
(04:02):
they'll say inflation. Where do you think that comes from?
I mean, you know, we've had real difficulties getting goods
from China. We've had real challenges with port facilities and
with containerships and the rest of that. That should get
fixed a lot faster if we're all able to live
with the virus. But if the world's second largest economy
(04:22):
and biggest producer of stuff that we need is actually
locking down like crazy all year and by the way,
you know, they won't even license western m RNA vaccines
like you know Fizer and Maderia. They're waiting for their
own Chinese mRNA vaccine, which they're pushing hard. But it's
not going read until the end of the year for
for big for big league population rollout. So is a
(04:45):
problem here, It's it's just really interesting. I'd say it is,
hey and not And I want to get too far
off of your your list of risk because we look
forward to it every year. But how big a deal
is it that we found out this year that she
is actually a communist. I mean he's not just like
a Putin style dictator who wants to be rich and powerful.
It would seem as an actual communists like reigning back
(05:05):
the you know, the successful businesses and sectors. In a
weird way, that seems like good news for us. Uh.
You know, the Chinese economy right now is more unequal
than even the United States, and for an ostensibly socialist country. Um,
that's a problem. And so what you have is she's
(05:28):
and thing acting like an authoritarian populist saying no, I
don't I don't care about jack ma, I care about
the working class in the middle class, and and and
that means I'm willing to take some hits in terms
of my private sector. So I don't know. If you
saw the Chinese government a few months ago said if
your kid you get two hours a week on video games,
(05:48):
you don't lose, you don't use them, they don't roll
over to the next week. You know a lot of
American parents that would love to put that in place too.
But the fact is that that that's basically, you know,
cut an enormous amount of wealth generation out of the companies.
He doesn't care. So I do think that that's going
to be a hit for a number of really, really
profitable Chinese firms. I want to be clear. That's very
(06:12):
different than say Chinese semiconductor industry, which they are putting
an enormous amount of money and they want to be
world class. That's very different from artificial intelligence and smart
cities and sensors and autonomous driving, where the Chinese want
their companies to be world leaders. So I think that
you may be over egging the putting a bit by
(06:33):
saying that this is the year we found out she
is a communist. Yeah, cut it out, ye over egger Um.
We could We could talk for the next month about China,
but let's move on to number two, which I found
so interesting, the techno polar world. The report says, the
physical world is a mess because no countries are willing
or able to provide global leadership. Digital spaces even more
poorly governed, do tell but we're so everyone is angry
(06:58):
at the big tech companies now because so much disinformation,
because there's so many challenges in terms of cyber at
tax and personal security getting hacked and critical infrastructure getting hacked,
and so you're hearing people say, well, government has to
do something about this. Companies. Tech companies are gonna get
(07:18):
richer and more powerful faster than governments can catch up
to regulate them. And that means more disinformation, more anxious populations,
more problems in in governance and elections. You know, when
you and I were kids, we would if you wanted
to figure out how screwed up we are, we would say, well,
it was either the way you were brought up, its nurture,
(07:39):
or it's your genetics. It's nature. Increasingly it's actually nature
versus nurture versus algorithms. It's you know, the it's the
virtual world and the way that kids are getting information
and connecting with people as intermediated by these algorithms driven
by tech companies. And you know we're doing that without
(08:00):
testing them on on anyone. First. You wouldn't do that
with the drug, you wouldn't do that with the GMO crop.
But we're doing that with literally the the thought processes
of the brains of our children. And I don't see
how that isn't becoming a much more significant ristmers society. Wow.
As a as a guy who's raising a nine year
old an eleven year old boy right now and dealing
with a lot of that, that is, man, that's a
(08:22):
heap and help on the stuff to think about right there.
That is really interesting. Well, you know that these the
executives from these companies don't let their kids on this stuff, right, So,
perhaps I'm an idiot because I thought, um, and and
about half the audience is saying, perhaps, um, I I
thought the US midterms is going to be fairly predictable
and probably not a great note. You disagree, obviously, that's
(08:45):
behind your list at number three, tell us what you're thinking. Well, look,
I mean this is in part this is because the
election is so critically important for UM, and in part
it's because the United States is fundamentally more politically dysfunctional
and divided than any of our major advanced industrial allies.
(09:06):
I mean, we've had elections in the last few months
in Germany, Japan, in Canada, they've all been fine, free
and fair. Will happen the next few months. In South
Korea grants no problem, we can. We can no longer
have free, fair, legitimate national elections in the United States.
The losing side thinks that they're illegitimate and stolen. And
that started in sixteen with the Russia collusion story. Hillary
(09:29):
Clinton didn't support it, but a lot of Democrats did.
It got much worse in because Trump himself pushed the
big lie and has been doing it very effectively with
his supporters for the last year. And now we're setting
up for the midterm elections where I mean, you know,
the Republicans led by Trump are very likely to take
(09:49):
the House, maybe the Senate, and key gubernatorial and state legislatures,
which are going to be critical for certifying the election
in So this is kind of a tipping point for
what is likely to be a much more problematic and
dare I say crisis cycles in the run up number
(10:09):
five on the list, skipping. Another China related topic is Russia.
There's a huge divide in the United States between people
who are critically interested in that and people who say
it's a border dispute in Eastern Europe. What the hell
do we care? Why should we care? Well? Um, we
care in part because the Europeans are our most important allies.
(10:30):
The trans atlantic relationship matters. Um. And we also care
because the Russians engage in a set asymmetric power efforts
to undermine us UH and weaken our trans atlantic relationship,
and and the incursions into Ukraine, the invasion back in
was a part of that. So Russia, look, they're making
(10:51):
a lot of money off of higher energy prices, and
as the winter is coming, the Europeans need Russian gas
and they're facing shortages. So this is high time for
the Russians to cause trouble for the West, and that's
why they put a hundred thousand troops on Ukraine's border.
We got together with the Europeans and said, if you
invade UM, we're gonna sanction you so hard. Your your
(11:14):
economy is going to be destroyed. And the question is,
are the Russians prepared to call that bluff in full
or in part. And if they if they call that
bluff in part, is it possible that the Americans are
on board and the Europeans are not and Biden looks
really weak and the relationship really blows up. I would
(11:34):
like to congratulate you for getting through this much without
any of your trucker language that nearly cost us our
FCC license last time. But um no, I mean, who's
who's going to think about the children? It's important exactly.
We were just talking about the op ed piece in
the Wall Street Journal today by a couple of think
tank experts about how Biden's got a tough decision to make,
(11:56):
like in the coming weeks maybe about Iran. Do you
rank that we're screwed on Iran? Can I say that? Yeah? Good? Um?
I mean this is the one policy, foreign policy that
Trump actually destroyed. Um. I mean, there a lot of
things Trump did to overturn stuff that Obama did, and
then we went back, so Paris Climate Accord, he pulls out,
(12:18):
we go back in nobody cares. Um. You know, he
says We're gonna leave the World Health Organization, the Middle
pandemic Biden recommits. Nobody cares. He leaves the Iranian nuclear deal,
which Rex Tillerson, you know that the Secretary of State
for a hot second actually said that the Iranians were
complying with Everyone supports us staying in the deal. He leaves.
(12:39):
Biden wants to get back in. We can't get back
in because the Iranians said, nope, we're we're fully We're
full speed ahead with our nuclear program. There are now
four weeks away from nuclear breakout capability, four weeks allied,
four weeks, four weeks in terms of highly enriched geranium stockpiling,
four weeks away from having the capacity to developing were weapon.
(13:00):
Do we strike them in a major military way the
way the Wall Street Journal op ed piece suggests, I mean,
certainly the Israelis will up their sabotage game, and the
likelihood that this becomes a military confrontation is going up.
This is this is a crisis that is now directly
on Biden's lab because the US unilaterally decided to rip
(13:24):
up the deal. We will have a link to the
Eurasia Groups two risk Report Top Risks two if you
want to look at the rest of it, And as always,
we can talk to you all day, but you have
a limited time. We thank you so much for the
inc We look forward to the next dance to talk.
Happy New Year, gentlemen, be good you two thanks. Four
weeks his number for when Iran has breakout? Are you
(13:48):
pooping me? So? If there's gonna be a military strike,
it's coming soon. Yeah. Hey, we know a lot of
Trump fans can't stand it. He he calls, calls him
as he sees him. He thinks Trump made some big
mistakes and he doesn't care who who's mad. We think
he's an interesting guy, so we talked to him. Yeah.
I think the Iranian thing would have turned out the
(14:08):
same way either way, but it's slight change in timetable
maybe honestly strong and yet
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