The Global World Order Is Collapsing- And It's Much Bigger Than Trump! | Impact Theory W/ Tom Bilyeu & Peter Zeihan

Welcome back to Impact Theory with Tom Bilyeu! In this episode, Tom sits down with geopolitical strategist Peter Zeihan for a fascinating deep dive into the tectonic shifts shaping our world order. Together, Tom Bilyeu and Peter Zeihan unpack why the global landscape is changing—and why it isn’t just about any single political figure, but rather the collision of long-standing trends in trade, demographics, and national priorities. You'll hear Peter Zeihan break down how the post–World War II system, built on American-led security and global cooperation, is unraveling amidst demographic decline and shifting alliances. They explore why the current moment might be unlike anything we’ve seen since the Black Plague, what happens when countries are forced to become economic generalists again, and why U. S. leadership is facing a critical test. Plus, Tom Bilyeu presses Peter on what this means for America’s future, global productivity, and the hard choices ahead. Whether you’re a geopolitical buff or just eager to understand how economics truly drives world affairs, this episode will challenge your assumptions and give you the tools to see the present—and the future—in a whole new light. Stay tuned for this thought-provoking conversation. Follow Peter Zeihan: Website: https://zeihan.com/ Twitter: https://twitter.com/PeterZeihan LinkedIn: https://www.linkedin.com/in/peter-zeihan-1a8176/ YouTube: https://www.youtube.com/@ZeihanonGeopolitics What's up, everybody? It's Tom Bilyeu here: If you want my help... STARTING a business:join me here at ZERO TO FOUNDER https://tombilyeu.com/zero-to-founder?utm_campaign=Podcast%20Offer&utm_source=podca[%E2%80%A6]d%20end%20of%20show&utm_content=podcast%20ad%20end%20of%20show: https://tombilyeu.com/zero-to-founder?utm_campaign=Podcast%20Offer&utm_source=podca[%E2%80%A6]d%20end%20of%20show&utm_content=podcast%20ad%20end%20of%20show https://tombilyeu.com/zero-to-founder?utm_campaign=Podcast%20Offer&utm_source=podca[%E2%80%A6]d%20end%20of%20show&utm_content=podcast%20ad%20end%20of%20show SCALING a business:see if you qualify here. https://tombilyeu.com/call: https://tombilyeu.com/call Get my battle-tested strategies and insights delivered weekly to your inbox:sign up here. https://tombilyeu.com/: https://tombilyeu.com/ ********************************************************************** If you're serious about leveling up your life, I urge you to check out my new podcast,Tom Bilyeu’s Mindset Playbook https://open.spotify.com/show/47VE90Cittmo6TGGFqg2xf —a goldmine of my most impactful episodes on mindset, business, and health. Trust me, your future self will thank you. ********************************************************************** FOLLOW TOM: Instagram:https://www.instagram.com/tombilyeu/ Tik Tok:https://www.tiktok.com/@tombilyeu?lang=en Twitter:https://twitter.com/tombilyeu YouTube:https://www.youtube.com/@TomBilyeu Quince: Free shipping and 365-day returns at https://quince.com/impactpod Shopify: Sign up for your one-dollar-per-month trial period at https://shopify.com/impact Ketone IQ: Visit https://ketone.com/IMPACT for 30% OFF your subscription order Incogni: Take your personal data back with Incogni! Use code IMPACT at the link below and get 60% off an annual plan: https://incogni.com/impact Blocktrust IRA: Get up to $2,500 funding bonus to kickstart your account at https://tomcryptoira.com Netsuite: Right now, get our free business guide, Demystifying AI, at https://NetSuite.com/Theory https://netsuite.com/Theory Huel: High-Protein Starter Kit 20% off for new customers at https://huel.com/impact code impact global security, US foreign policy, trade, demographics, Cold War, NATO, globalization, manufacturing, K-shaped economy, world order, American alliances, post-World War II system, containment, economic sanctions, Iraq War, war on terror, US industrial base, economic models, Modern Monetary Theory (MMT), tariffs, Trump administration, supply chain, deglobalization, NAFTA, regional globalization, policy experts, Cuban workforce, Colombia infrastructure, technological stagnation, demographic collapse, China-US relations Learn more about your ad choices. Visit megaphone.fm/adchoices https://megaphone.fm/adchoices See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Tom Bilyeu?

  Let's talk about the moment your side hustle becomes a real business. Now, I see way too many founders stay stuck running their business like it's a hobby, and then they wonder why nothing ever feels real. It doesn't feel real because it's not. I've helped thousands of entrepreneurs build real businesses through Impact Theory University, and the first step in the path to building a legit business is registering it. And Taylor Brands will help you do just that in a few clicks. An LLC, a limited liability company, is an official business structure. It's inexpensive to form and very simple to maintain. It's how you open a business bank account. It's how customers know they're dealing with a real company. And Taylor Brands doesn't stop at the filing.

• 0:45Tom Bilyeu?

  Their dashboard tracks what comes next based on what your business actually needs. So EIN number, registered agent, licenses and permits, bookkeeping, business banking. I tell every founder the same thing. Just make it official. Click the link in the show notes to check out Taylor Brands and get started on your business today. This is a paid advertisement. Most people think what's happening right now in the world is because of Trump, but I've heard you say that we were always going to end up here. I would love to get an explanation on that, like what is here exactly?

• 1:20Speaker 01

  Yeah, well, I mean, first, let's start by saying that the US president, whoever it happens to be, is the most powerful person in history and typically the most powerful person in the world. Trump, no exception to that. To say that he's not having an impact is not what I'm going for. But we had a couple of massive trends that have been playing out for the last several decades that are coming to an abrupt halt right now anyway. And Trump is manifesting how we evolved from those old systems to whatever comes next. So he is going to be...

• 1:54Speaker 01

  One of, if not the most consequential, American presidents in modern history, simply because of the timing for when he is in the big chair. And he will have an imprint upon what it means to be American, or what it means to be human on this planet for decades to come. And those two big trends are trade and demographics. The whole concept of how we have managed the world since World War II was that the United States will take care of global security, make sure that anyone can ship anything, anywhere, at any time. The US will keep their markets open if you allow us to write your security policies. And that's NATO, and that's the Japanese and the Korean and the Taiwanese alliances. That is the physical structure that makes it all possible.

• 2:36Speaker 01

  But for the Americans, it was always about security, not about trade. And so as a percentage of GDP, if you remove agriculture and energy, we only trade with the rest of the world for 5% or 6% of GDP once you factor out NAFTA. We're just not involved in it. That was the deal. If we had invested our economy into the world, it wouldn't have been a trade. It would have been an empire, and no one would have joined. So that's kind of piece one. And we've been moving away from that since 1992 because the Cold War is over. Trump just happens to be the guy who is officiating the formal break.

• 3:14Tom Bilyeu?

  So really fast, when we were talking about controlling people's security policy, it was just a question of Russia?

• 3:20Speaker 01

  At the time, yes. Keep in mind that if you go back to the 80s and the 90s, China was an ally.

• 3:27Tom Bilyeu?

  That's interesting. Okay, so if our goal was, we need to deal with Russia. We dealt with Russia, the USSR collapses. I've heard you talk about the first Bush presidency. H.W. Bush tried to get us to have a conversation about what the New World Order was going to look like. One, help me understand, so if this is trade is a huge part of the world order, if demographics are a huge part of the world order.

• 3:56Tom Bilyeu?

  Other than um safety, like what is the world order? When we say that, what do we mean?

• 4:02Speaker 01

  Well, from the American point of view, it means one thing. From everyone else's point of view, it means another. So from the American point of view, it was about containment or neo-containment, or whatever version of containment you want to call it.

• 4:13Tom Bilyeu?

  So stop anyone from getting too powerful to challenge us?

• 4:16Speaker 01

  Exactly. Wherever that happens to be, uh, the Western Hemisphere is very well insulated from the rest of the world, and North America is the best chunk of land on the planet in terms of its capital capacity and for developing an integrated nation-state. And the Greater Mississippi, the East Coast, that those two chunks are not, they don't exist anywhere else on the planet. And to have them both in the same political authority gives us massive flexibility. But that doesn't mean we can impose on the rest of the world. That requires a strategy that involves basing and allies. And so what we did with our post-Cold War, excuse me, our post-World War II environment,

• 4:56Speaker 01

  was incentivize all of the allies to participate in our security structures and use their land and their armies and their navies to impose a security regimen on the entire hemisphere. And so the French, the British, the Japanese, the Turks, all of the major powers of the last half-century, excuse me, half-millennia, became, from a certain point of view, proxy powers under American control. And according to our treaties with all of them, in the case of a hot war, we take command of their militaries, something that a lot of people forget today when they're talking about the fact that these countries apparently owe us. So we created this structure where all of the powers of the past

• 5:40Speaker 01

  were functionally on the same side, under our command, except the Russians. And that's why the Cold War ended the way it did. There was never a strategic or economic option for the Soviets to prevail. But the Cold War ended 30 years ago. And we have failed to update those strategies for the new reality. And so low and behold, whether you're on the left or the right in American politics, the rest of the world just seems less relevant to you. And we've been edging away from that system ever since, and now it's breaking.

• 6:12Tom Bilyeu?

  All right. Having grown up in the middle of it, it felt awesome. So what I want to understand is what broke down? So regardless, like, okay, Russia, let's say, is the excuse. So we all have to band together, but what you described sounded like to me empire via cooperation instead of empire via force or having to pay for everything outright. So a quite incredible system and speaking from experience, as an American anyway, it felt fantastic. So why without Russia? Why did it begin to break down? Is it because that system was great for America, but not other places?

• 6:51Tom Bilyeu?

  Or has or did say globalism hollowing out our manufacturing, creating a K-shaped economy? Is that what ended up becoming intolerable such that we were always going to end up here to quote you?

• 7:04Speaker 01

  K shape is more recent. Let's put that to the side for now.

• 7:10Speaker 01

  The whole concept was that we pay you to be on our side. And when everyone agreed that nuclear annihilation was a problem, it was pretty easy to make that deal. But after 1992, no one until relatively recently, 2022, the Ukraine war, thought of the Russians as a problem. They thought of them as just something that could be managed off to the side while they stew in their own juices and degrade. And they are still degrading. Go back to that if you want to. But the idea that we were under this nuclear pall had faded. And so various countries, based on their politics, based on their internal demands, became less willing to sublimate their security policies to the United States,

• 7:53Speaker 01

  became less willing to follow Washington's lead on things like economic sanctions. And as the United States' attention moved from the Russians to other things like, say, Iran, a lot of countries like this isn't what we signed up for. And so there became a lot more friction in the system that really accelerated in the George W. Bush administration with the Iraq War. Because the Americans said, you know what? We hold up the ceiling here. Why are you not helping us with this conflict? And for the French and the Germans, there's like Because this isn't what the conflict is that we agreed that we were all on the same side for. This is something new. You're trying to repurpose this without negotiating with us. And so you can see how we saw fissure in the alliance at that point.

• 8:36Speaker 01

  You move on further into, say, the 2010s and the war on terror. And the United States just became obsessed with things what from the European and the Japanese point of view were ever more esoteric. And they wanted economic opportunities that went different directions. So the Germans started getting the vast majority of their energy from Russians. A lot of countries started integrating with China because they saw an economic advantage to doing that. And if it happened to hollow out the American industrial base, or even some of their allies, that was fine because economics evolve. And so the United States saw problems with the structure because we were no longer being able to dictate the security environment. And everyone else saw problems with the economic structure because they saw the Americans in many ways becoming a barricade

• 9:21Speaker 01

  towards what they thought was perfectly natural activity. And the bilateral agreement between us and all the allies that had held for 40 years broke down bit by bit at pretty much every functional level until we get to Trump. It was always going to end now, this decade, 2025 to 2035, for demographic reasons. The problem there is when we started to globalize back in the 40s and 50s, everyone moved off the farm and into the town. When you're on the farm, kids are free labor. You have a lot of them. You move into town, all of a sudden, kids are expense. And so we went from, on average, in the Western world, having something like four or five kids today to having only one to two.

• 10:04Speaker 01

  You do that for 80 years, and eventually it's not that you run out of children. That happened in the 80s and 90s in most countries. We're now in the position in this next 10-year period where we're running out of working-aged adults. And there is no trade if there is no one to consume or produce. So we're looking at a collapse of the economic model. And the security model was based on the economic model. So we were always going to get to some version of where we are now. And now the economics have caught up to the politics and it's all breaking.

• 10:41Tom Bilyeu?

  We're hitting pause for a moment, but there's plenty more ahead, so don't go anywhere. There's a reason Quince sells cashmere for $60, and it isn't the cashmere. It's real 100% Mongolian cashmere. It's the same stuff luxury labels charge a fortune for. Quince just works directly with ethical factories and cuts out the middleman. So there's no need for a markup and no logo tax. The $60 goes to the actual sweater, not the fancy name on the tag. That's why everything they make runs 50 to 80% less. And it's not just the cashmere. I ordered a few things myself, their fleece joggers, a couple of their tees, which I wear obsessively. First thing I noticed was the quality.

• 11:25Tom Bilyeu?

  Soft, well-made, built to hold up. They make down jackets and wool outerwear now, too. So upgrade your stuff to things you'll actually wear. Find your next fall favorites at Quince. Download the Quince app for app-exclusive offers or go to quince.com. Get free shipping on your order and 365-day returns, now available in Canada and the UK, too. And when Quince asks where you heard about them, let them know it was Impact Theory. It's the best way to support the show. Let's talk about something that genuinely keeps me awake at night. My team at Impact Theory gets hit with phishing scams from bad actors pretending to be me all the time. And they keep getting more sophisticated attacks with details specific enough to look legit.

• 12:10Tom Bilyeu?

  AI has made a lot of things possible, including scams like this. But AI still needs raw material. It gets it from data brokers who sell your name, address, phone number, to anyone willing to pay. Incogni goes after that supply. They handle removal requests across 420-plus harmful broker sites. And they keep checking back as brokers constantly try to relist you. On the Unlimited Plan, the exposure scanner hunts down your information. Send a link, and their privacy experts handle the takedown. Track your progress in the app and get a monthly risk assessment showing exactly where you stand. Go to incogni.com/impact and use code IMPACT for 60% off an annual plan.

• 12:55Tom Bilyeu?

  Incogni is I-N-C-O-G-N-I dot com slash impact. Promo code IMPACT. It's completely risk-free with a 30-day money-back guarantee.

• 13:09Tom Bilyeu?

  Thanks for sticking around. Let's get right back into the action.

• 13:13Tom Bilyeu?

  Alright, so I'm always telling people, everything is downstream of economics. To understand world affairs, you have to understand humans as economic units. I think people are often very confused by what I mean by that. So you certainly have not said those words, but they feel very in line

• 13:30Speaker 01

  They rhyme.

• 13:30Tom Bilyeu?

  With if demographics is largely a trading problem, you are saying a very big statement, which is we're basically gonna have to reinvent an economic system. And I never hear anybody push you on that, like, that to me is like earth shattering. So what, what does that mean? Do you have any guesses as to what that might look like?

• 13:56Speaker 01

  I have one guess, and I will not put any money on it. But the backdrop, capitalism, communism, European-style socialism, totalitarianism, fascist corporatism. Those are the four big models of the last 500 years. All of them are predicated on a balance between supply and demand and labor and capital. And each one of those four models

• 14:20Speaker 01

  values a different aspect of the process. So European socialism is a little bit more pro-labor than pro-capital. Capitalism is a little more capital than pro-labor. And then the balance of supply and demand is basically a demographic question based on how many people you have that are under age 50 who are doing the consumption versus over age 50 who are generating the capital. That's how we've managed this system for the last 500 years. And all four of those models are based on the concept that the population gets a little bit bigger every year. And so they are all growth-based models. But in the next 10 years, that will no longer be true. We already have the bulk of the advanced world

• 15:04Speaker 01

  aging out to the point that they all have shrinking populations. And most of the rest will slip in the next 10 years. And even the advanced industrializing countries, your Mexicos, your Indias, your Brazils, are very, very rapidly moving into that position, and they will be there 10 to 20 years from now. So all four of those economic models, the very basis of them, doesn't work with where we're about to be, and we're gonna have to come up with something new. Very little experimentation has gone on to this point. You're probably familiar with modern monetary theory, MMT.

• 15:37Tom Bilyeu?

  Aggressively.

• 15:38Speaker 01

  Yeah, I'm not suggesting for a second that that is going to work, but it's one of the few examples out there of people experimenting with something new. And so as long as the experimentations don't happen where I have a bank account, I'm all for it. Because you know, even if it fails utterly, and I think it will fail utterly, we're probably going to learn a few things from that that will be useful down the road. The only other model that I'm seeing any experimentation with, and it really doesn't have a name yet, is what the Trump administration is doing, which is an artificial restriction on production by government policies that are chaotic.

• 16:15Tom Bilyeu?

  You're saying the chaos itself, whether intentional or accidental, restricts production?

• 16:19Speaker 01

  Absolutely. We've seen industrial production and employment drop for the last 11 months. That's not by accident.

• 16:25Tom Bilyeu?

  And that, you're going to put that in the zone of economic model?

• 16:30Speaker 01

  I don't want to overplay it because I doubt this is being done on purpose. But we've seen manufacturing contract, we're seeing agriculture contract, and because of tariffs, we're seeing consumption contract. On the other side, Trump very, very clearly has his favorites. And he's artificially restricting the demand of groups that he doesn't like. So a demand management model, where you have an arbiter in the government who decides who can consume what. It's a combination of capitalism and fascism. I'm not saying it's going to work. I'm saying it's the only other experimentation I've seen out there so far.

• 17:09Tom Bilyeu?

  Wow. Okay, looking at that as an economic model is utterly fascinating. Peter, I've never heard anybody else say that. And I've certainly never thought of it myself. This is very interesting.

• 17:19Speaker 01

  It's horrific, let's be clear. But it's an experimentation.

• 17:21Tom Bilyeu?

  Yeah, but look, you gave me the chills. Looking at it as an unintentional, a natural test of a new economic model, one that neither of us, it sounds like, would support or want, but the fact that it's happening means that we can look at it through a new lens. Okay, so.

• 17:35Speaker 01

  And it, it matches what's happening with demographics, which I find even more problematic.

• 17:41Tom Bilyeu?

  Okay, very interesting. To understand this, I think the best question I could ask is, the moment we're living in right now, what is the closest historical correlate?

• 17:53Speaker 01

  Black plague. That was the only other time in history where the population declined.

• 18:00Tom Bilyeu?

  Okay, uh, what, what do we learn?

• 18:03Speaker 01

  Not a great comparison, I agree.

• 18:04Tom Bilyeu?

  Not, not a great comparison because it's horrible or not a great comparison because it's not accurate?

• 18:09Speaker 01

  Uh, well, you're talking about not just a pre-industrial society, you're talking a pre-deep-water navigation society. So it really was a very, very, very different economic structure by every way that you can imagine it. But it's the only example where not just the population was declining, but the bulk of the population decline happened in relatively young people. And so it roughly, very roughly mirrors where we are now, where we're running out of people under age 50.

• 18:36Tom Bilyeu?

  Okay, so knowing that we can't just map it one for one, what can we learn from that that might give us some directional information?

• 18:44Speaker 01

  Well, again, I'm not sure this is a plus or a minus, but after the black plague swept through Europe and killed a third to half of the population, what we saw was a change in labor mechanics. Because all of a sudden, there were not enough people to maintain the feudal systems that had been the European norm throughout the Dark Ages, going back to Rome.

• 19:07Speaker 01

  What that meant is for the first time in human history, skilled labor had an economic incentive to expand. It used to be you had lots of masses of unskilled labor who lived on the farm and paid their rents, who were controlled by the feudal lords. And then you had a thin sliver of skilled labor in the cities. All of a sudden, that group off in the countryside collapsed, and there was a need to increase productivity in every possible way. So for the first time, we saw institutions form with the specific intent of expanding the skilled labor pool. And even in places where that didn't happen, like, say, Northern Germany, you had a situation, it wasn't Germany at the time, Holy Roman Empire.

• 19:50Speaker 01

  You had a situation where just naturally, the demand for goods and services required people being more productive than they had been before. So you had this alignment of institutions and economic and demographic factors that all encouraged everybody to be better at what they were doing. And the direct outcome of that was the Renaissance.

• 20:11Tom Bilyeu?

  Interesting. Okay, so it does feel like there's a slightly similar setup to what's happening right now, where we have demographic collapse in China, which is the most skilled manufacturer in the world.

• 20:24Speaker 01

  I wouldn't say skilled, but certainly the largest by output.

• 20:26Tom Bilyeu?

  Interesting. So who's the most skilled?

• 20:29Speaker 01

  In terms of value added, you're going to have a constellation, Taiwan, Korea, Singapore, the United States, Germany, United Kingdom.

• 20:38Tom Bilyeu?

  Okay, so is there any protective mechanism from that being spread out?

• 20:44Speaker 01

  It's a skill issue. We, in the modern system and the globalized systems, we all specialize because we can. And if we go back to a world where we're all generalists, you're going to have a significant drop in the technological capabilities of the planet and of the individual economies. So we all do different things. The Germans do forced generation, precision manufacturing, but have managed to do it at scale. The United States designs the systems and then marries it to close support merging with technology, which with more traditional tech like you would think of when you think of Silicon Valley, so that everything has a services component as well. The Singaporeans, they're great at precision measurement, and then those tools are used in other systems. The Koreans, it's memory chips. We all go

• 21:28Speaker 01

  like Taiwan, Taiwan, Taiwan, TSMC, GPUs, all that, and that's true. But the Koreans are actually better. It's just a different kind of chip they focus on. So we're all very good at very specific things. And we take components from one of these systems and merge it with manufacturing in the others to make the products that we use. That doesn't mean that China's irrelevant. It just means that China is much further down in terms of value added. They're very good at assembly, and they have scale to do a lot of things that other countries just can't pretend to do. But they don't actually add a lot of value to what they're doing.

• 22:05Tom Bilyeu?

  All right, you just put a finger on a very interesting problem. So we're in a world that for the last 80-ish years has been hyper-globalized, everybody specialized, we were all getting along because of the world order that the US put in place from a trade and security perspective. That's all now beginning to fall apart for the reasons that you were saying before. It stopped being advantageous to the US because other people felt like they were not getting their opportunity to shine economically. They didn't want to fight the most recent war that the US was asking them to fight. It was always meant to be about Russia. So we get these natural tensions. Now this hits a boiling point, partly because you have a unique figure in Trump and partly because this is just where we were going to end up regardless. But now you have a world

• 22:49Tom Bilyeu?

  that's pulling away from each other, that's designed to have really easy transportation of highly specialized skills and the outputs from those skills. So as that breaks apart, what does the world start to look like? Because if everybody then has to become a generalist again, at a moment where the population is declining, yeah, how does that play out economically?

• 23:15Speaker 01

  Well, this is why Trump matters. It's because he's the guy in charge and making the decisions as this happens. If you dial back to George W. Bush, he was the last American president to negotiate and implement a meaningful trade deal. And at the end of his terms, we had NAFTA, we had free trade deals with Colombia and Chile, Japan, Korea, and reasonably good manufacturing integration with the European Union. We haven't changed it since then. Now, in my opinion, that cluster is exactly what we would have needed to generate mini-globalization or globalization 2.0, whatever you want to call it. The US was very well positioned to

• 23:57Speaker 01

  use that cluster of countries, maybe put a couple of others, in order to make a smaller version of the global structure where we wouldn't have to sacrifice the technological level we've become used to or the standard of living we've become used to. But Obama basically sat in the White House for eight years and did nothing. Trump has been a very disruptive force, and Biden was Biden.

• 24:19Speaker 01

  So we're now in a situation where all of those relationships are degrading. And if we can't re-solidify the NAFTA courts next year when they're up or this year when they're up for renegotiation, we're going to be in a situation where a lot of these pieces suddenly won't work anymore. From the American point of view, that means doing things more or less by ourselves. And that means four steps of the supply chain that are not the things that we excel at, like say, assembly. We have to take someone who earns $75,000 a year, the average American income, and all of a sudden have them doing die cast and basic assembly, jobs that you probably shouldn't be paid more than $6,000 or $7,000 a year for. Whoa. That manifests, among other things, as a vastly lower standard of living

• 25:03Speaker 01

  or massively inflationary. Those are basically our choices here. For the rest of the world, without the United States providing the freedom of the seas and the rule of law that allows intermediate products to shift around, no one can specialize anymore. And so you have a catastrophic reduction in what countries can do individually. Maybe they can cut deals regionally, like say Southeast Asia, very bullish on Southeast Asia.

• 25:30Speaker 01

  But it means that they lose the strength of the whole. You no longer can export to a larger market to earn income to then update your industrial basis. And that's the entirety of the Japanese, the Korean, and the Chinese models to this point. For the European Union, they've aged out. They have to export. And if they can't, you're looking at them having to invent that new economic model in like five to 10 years instead of the, say, 30 to 50 years that the United States has. So we're looking at, we're at the dawn of, at a best, a technological stagnation as we have to generalize versus specialize. And that's before you consider some of the financial outcomes

• 26:13Speaker 01

  that come from a rapidly aging demographic on a global basis.

• 26:17Tom Bilyeu?

  Okay, we'll get to that in a second, but I really want to push on this idea of we have maybe a narrow but closing window to have some sort of regional globalization where we find sort of that the least number of unique countries and specialty skills that you need to continue the current way of life that we have will round it to NAFTA and Trump is not showing the ability to bring them together and so is an accelerant on the dissolution of that that union. What should Trump be doing? Like if if you could advise him and he would listen to you, what would you be encouraging him to do? Yeah, very much a hypothetical.

• 27:02Speaker 01

  Yeah, I'm gonna say let's start by saying that when Trump was out of power, he gutted the Republican Party of all its policy experts so that it is just a vehicle for his personality. So the Republican Party today, it's lost its national security arm, its business arm, its fiscal conservative arm, its law and order arm, they're all gone. It's just him. So when he came in, he came in with the smallest team of any American president in history. And the first thing he did was got the federal government of the top 6,000 positions so that policy cannot be implemented. So my advice to Trump would be to, you know, shoot Vance and leave and let's try this over with someone else because clearly he

• 27:43Speaker 01

  has designed the system so it cannot function on purpose. If I was talking to any other generic president, it's you need to look at what we can't do. Mexico is too skilled to do assembly. So we need a relatively large ish population somewhere that is further down the value added scale that can fill that gap. The two best options are Colombia and Cuba. Colombia, we already have a free trade agreement with there. It's an infrastructure problem. Cuba, however you want to get Cuba on board or a wide variety of options, go

• 28:24Speaker 01

  to town. It can be more than a tropical Vegas because you've got a workforce that is probably about one third as skilled as the Americans, but work for one tenth the cost. That's a great set of math to start from an assembly point of view. Those two, could you mind, probably would be enough for what we need. Uh, the other big problem is processing. Uh, one of the effects of globalization is we go broadly with the most reliable, lowest cost producer. And so China has lower environmental regulations and processing is technology that was developed more than a century ago. So turning aluminum to bauxite, refining rare earth metals, getting the cobalt out of Congo with slave labor and turn it into cobalt metal and intermediate components.

• 29:09Speaker 01

  That, North America does not do well. Now, because of the shale revolution, the US has the cheapest energy and electricity on the planet, but you still have to build out the basic infrastructure and we really haven't started that yet. Uh, the Trump administration talks a good game there, but there's been no money really put behind building the actual infrastructure because the people who knew how to do that were all fired in the first week. So we have to build out some more government capacity in order to lead this effort and this administration just hasn't been interested in that.

• 29:42Tom Bilyeu?

  Okay, very interesting take on the Trump administration. So, um, if we were actually going to get the, um, things moving, cause to your point, Trump is talking about, hey, trillions of dollars of investment, people want to be here, America's the hottest country ever. Uh, he loves saying that.

• 30:01Speaker 01

  Yeah, the members don't back that up.

• 30:03Tom Bilyeu?

  That, that would not be new for Trump.

• 30:05Speaker 01

  Yeah, exactly.

• 30:06Tom Bilyeu?

  To make a statement with absolutely no backing whatsoever. But, uh, so we've got maybe interesting idea, build infrastructure, get people to invest in America, maybe they're even willing to do it. However, they're going to run up against the people that are going to facilitate that on a political level, uh, have been wiped out. And so people come checkbook in hand, but they're, it's like, I need certain regulations to be changed, um, not just Trump winking and nodding and saying, don't worry about the old regulations, you'll be fine, just ignore them and build anyway. Uh, and anybody with a brain knows that, uh, Trump could be out of power, uh, effectively as soon as the midterms potentially, but certainly, uh, within the next three years, potentially, I'm not, it's way too early to call.

• 30:47Speaker 01

  Goodness, yeah.

• 30:49Tom Bilyeu?

  But if you're a business guy being asked to invest a trillion dollars, you're going to be like, well, I'm going to drag my feet. I need to see how this plays out. And if you don't have the policy experts to actually get this across the finish line, you've got a problem. Okay, so very, very interesting. On top of that, if we aren't going to bring this stuff in-house, we've got to be willing to go somewhere else to do the refining, to build that infrastructure that either already has it, China, and we can just establish a better relationship. I don't think that's going to happen with China for Thucydides' trap reasons. But that's not going to happen.

• 31:23Speaker 01

  I'm not worried about Thucydides, but it's still not going to happen.

• 31:25Tom Bilyeu?

  Yeah, that's on my list of things to talk about. So, so if we're, we're telling Trump to shoot J.D. Vance and start over. So it would be getting the policy experts in place so that infrastructure can be built here. It's somehow, some way, getting a relationship with a nation that can accept, that not only can accept lower wages than what we do, but that's just where they're at. So they'd be like, yeah, that's what a wage goes for. This is fantastic. So could be Cuba, very interesting. Could be Colombia, sounds like we've got some beef there. So if you start really placing bets on how this plays out, what do you think is more likely?

• 32:08Tom Bilyeu?

  Are we going to Maduro, Cuba? And we come in like we did with Venezuela? And we just snatch up the leadership and make it work the way we want it to? Are we going to strike some sort of deal with Colombia? Or are we going to go entirely in the, bring the policymakers in-house?

• 32:26Speaker 01

  Well, let's start with Colombia because it's simpler, I think. Colombia's limitation is infrastructure. The people live in the highland on the sides of mountains. Because if you go any lower, it's humid and tropical, and it's just can't build infrastructure, maintain it. If you go higher, you're in tundra, and nobody can live there either. So it's an infrastructure issue of getting things by road and rail up and down among the major cities and out to a port like, say, Cartagena. That can, I love to say this, that's one of those things that can be solved with money. And, you know, money, at least from the American point of view, is not in limited supply if we don't want it to be. The second issue, Cuba's a little more complicated because of Castro.

• 33:05Speaker 01

  Gutted the civil society. And now that the castros are gone, you just have a cluster of like 80 year old generals running the place and they're about as dynamic as Biden and Trump are in terms of doing things for the country. So if you remove all of them, you're not left with a blank slate because there's millions of people there, but you're left with a system that doesn't have a logical next step. And restructuring it politically so it can accept investment is going to be a challenge. And you can't do that without institutions like USAID, which are now gone. So we're going to have a really interesting case study in Venezuela right now because that's more or less what has happened in Venezuela.

• 33:49Speaker 01

  We remove the chief thug, the backup thug is now in charge and there's only about a dozen thugs around her and then there's nothing below it. So if, if, if by some magical experience, then Venezuela doesn't collapse, then maybe we have a model. But the US doesn't have the tools to impose something else at the moment.

• 34:10Tom Bilyeu?

  Hmm. Okay. So taking a short break, but there's more Impact Theory after. Stay tuned. You're probably paying two salespeople to do one salesperson's job. That's where today's sponsor Pipe Drive comes in. An intelligent AI-powered sales CRM loved by growing sales teams. Pipe Drive just launched meeting intelligence built right into the CRM. Before every call, it pulls deal history and past conversations into one brief. During the call, it records and takes notes. After it, it drafts your CRM updates to review and approve. So there's less admin and more selling.

• 34:54Tom Bilyeu?

  Switch to a CRM built by salespeople for salespeople and join the over 100,000 companies already using Pipe Drive. My link gets you an exclusive 30 days free instead of the usual 14 day trial. There's no credit card payment needed. Just head to pipedrive.com/impact to get started. Again, that's pipedrive.com/impact and you can be up and running in minutes. Thanks for staying tuned. Now let's get back to it. When I look at the Trump administration, I, I may be prescribing to them too much

• 35:36Tom Bilyeu?

  forethought, but I'll give you what I see happening and then poke holes in this. I have absolutely no interest in being right. I just want to update my mental model. So I know literally where to invest my money. How do I need to be thinking about this? Who's going to own the next century? Like, those are the questions I care about. So, okay, the, when I look at the Trump administration, what I see, and obviously this speaks to my bias because I am a business guy, but I see a business guy coming into the office, trying to run a country like a business, which is a terrible idea, but nonetheless has high predictive validity from where I'm sitting. Let me stop you right there. Trump's not a business guy. He's a marketer. That's different. Marketing is a part of the business, but let me, I'll make my best case. That's the only part he does.

• 36:21Tom Bilyeu?

  Um, I, I'll, I'll disagree with that, but I'll give you the opportunity to swat the specifics down because the, it'll all live in the details. So the reason I map him as a, a business guy is I'm leading with, one of the primary things a business person has to understand is where's your leverage? And so I look at Trump as somebody who sees America as a melting ice cream cone, but he understands that we have a limited window where we really can still press our advantage from an economic and military standpoint. And the card that no president has played before him is force. And so whether that's economic force and you're threatening Canada and you're

• 37:00Tom Bilyeu?

  threatening the EU and you're, you know, talking to all kinds of tariff madness, like tariffing everybody left, right and centered, what you're calling the controlling the demand, making it impossible for people to buy from places that he doesn't like, utterly fascinating. So he's certainly doing that. And then the military advantage, thankfully he has since removed the threat of force with Greenland, but we saw him deploy it against Venezuela, right? We saw him deploy it against Venezuela. He certainly understands, even if it's only a bluff, that he has it as a thing that he can play as a Bluff to find out where everybody's real like anger is going to be risen.

• 37:43Tom Bilyeu?

  I think he floated it with Greenland almost to see like, what do people do? And then the backlash was so coordinated, so unified that I think he realized, okay, this is a terrible idea. But he sees those two points of leverage. Now I see him moving with an urgency because I think he thinks that there's a narrow window where this is going to be useful. It could be he just knows he won't be in power for very long and he believes he's the only one with the guts to do it. Or he could be, he could believe that it's just declining. And so there's a narrow window where we're actually able to do it. But that read makes Trump make sense to me, even in Iran. I don't read him as being somebody who's altruistic. I don't think he's doing Iran for any reason other than it makes an ally in Israel happy.

• 38:28Tom Bilyeu?

  And it allows us to control more of China's cheap energy, basically. And if he sees us, as I believe he does, in a war for supremacy with China. And he sees China attacking the dollar in terms of global trade with what BRICS is trying to do from creating an alternate payment system to the dollar. All of that then makes sense. You go after Venezuela, a source of cheap oil for China. You go after Iran, a source of cheap oil for China. And it's like, okay, if this is a desire to quarantine or make more difficult life for your number one adversary. And you're a guy who thinks in terms of leverage, it all makes sense. Where do you think that falls apart?

• 39:13Speaker 01

  Unfortunately, several places.

• 39:15Tom Bilyeu?

  Yeah, please, there's no unfortunate. I just want to know how to move through the world.

• 39:19Speaker 01

  Yeah, let's start with the China situation. If the goal of the United States is to beat the Chinese, you don't need a war. You just need to put two or three destroyers in the general vicinity of Singapore and stop the oil flow and it'll all be over. And by all, I mean Chinese civilization will all be over in two years. This is a country that is completely dependent on freedom of the seas to exist and on the American market to facilitate the flows of oil and raw materials into their system. That is very easy to disrupt without getting within shooting distance of the Chinese in any way. And if that is the goal, easily done. And if there is a hot war, it will be over. The United States could lose every single carrier it has in a straight up fight with China.

• 40:04Speaker 01

  It would be dumb, but it could happen. But again, two or three destroyers to stop the energy flows and the food flows and it's all over. They would be facing civilizational collapse. Half the population would be dead within two years. Whoa. Seven years ago, Chairman Xi knew that. It's also when he got rid of his last advisor and he's been eating nothing but propaganda since then. So I don't know if he still believes it, but he used to. And so when I look at things like Venezuela and Iran, I see something different. I see something much more material. It's not that the United States has ever gotten along with these places under their current governments, but the volume that goes to China, it really isn't all that high. Total exports from all of Venezuela and all of Iran are now under 2 million barrels a day. You know, that's less than 2% of global production.

• 40:49Speaker 01

  I don't mean to suggest that's nothing, but that's not enough to move the needle in any meaningful way. In addition to considering that the Chinese importing 14 or consuming 14 million, 15 million barrels a day now, I think. It's not that it comes from these places. It's that it flows through a route that can only exist if the US Navy is keeping the sea safe for everyone. So if your goal is to break China, there are far simpler ways. And if that is your goal, the first thing you should do is build out the industrial plant you need at home for success. Because when China breaks, things that we need will stop.

• 41:32Speaker 01

  And you best provide an alternative supply of those things first. And I'm not seeing that.

• 41:37Tom Bilyeu?

  Yeah, that's part of what makes me think that while he, while his advisors, I won't even give Trump that much credit, but while his advisors, however thin that pool may be.

• 41:48Speaker 01

  He has one on foreign affairs and foreign economic affairs. He has one and until September, he wouldn't even let him in the, in the Oval Office.

• 41:57Tom Bilyeu?

  Who is it?

• 41:58Speaker 01

  Rubio. He's the only one.

• 42:01Speaker 01

  No one else on his team has any idea of how economics or foreign affairs works.

• 42:07Tom Bilyeu?

  I didn't realize he had at any point kept Rubio at arm's length.

• 42:10Speaker 01

  Oh, yeah, I know. In the first few months of the administration, basically, you had Vance guiding him on everybody is evil, so we should kill everybody, including the Ukrainians. Vance is just a waste of genetic material.

• 42:22Tom Bilyeu?

  Damn.

• 42:23Speaker 01

  And then you had Tulsi Gabbard, who, for all practical purposes, is a Russian plant, who was shaping policies for the Russian Federation through the White House. And as part of that process, they gutted the State Department, they gutted the National Security Council. So all of the normal voices that funnel everything from the intelligence services and the military up to the president so he can make informed decisions, that was all deliberately dismantled. And it wasn't until, get this, Melania, back in November, was talking with her husband after Trump came back from a phone call with Putin about how wonderful everything was. And she's like, oh, yeah, and he just bombed an orphanage. Here's some photos.

• 43:06Speaker 01

  And he, wasn't until November, because of the first lady, they started to realize that the Russians have been pulling the wool over him every day for 10 months, and we're just making him look like a fool. That is roughly about the same timeframe that Rubio came up with the Venezuela strategy and finally got back into Trump's good graces and actually could be in the room. And so we actually now have one, one person in the administration that is giving the president decent advice on what's going on in the world. And that's what also brought Jared Kushner back in. Kushner had decided to avoid the administration the second time because it was so much fun the first time.

• 43:49Tom Bilyeu?

  Yeah.

• 43:49Speaker 01

  And so Trump had relied on Steve Whitkoff, who was one of his buddies from his New York real estate days, who knew nothing about foreign affairs, celebrated the fact that he knew nothing about foreign affairs. And so would pick one side in a conflict, like for the Ukraine war, he would talk to the Russians, but not the Ukrainians. In the Iran conflict, he would talk to the Israelis, but not the Iranians. And he would just basically go there, absorb the propaganda, and then vomited on the floor of the White House. And that made policy. So by November, because of millennia, he realized that maybe I need one more person. And he brought Kushner back. And so whenever you see Kushner go somewhere with anyone else,

• 44:30Speaker 01

  you know, there actually might be real talks. But if Whitkoff, I'm sorry, I phrased that wrong. If you see Whitkoff going anywhere with one other person, there might be real talks. But if Whitkoff goes alone, you know, it's just the opposing side's propaganda that's going to come back.

• 44:46Tom Bilyeu?

  That's very interesting. Okay.

• 44:49Speaker 01

  No, no real advisors, that the team from the Republican Party is gone. And then the institutions have been damaged and gutted.

• 44:58Tom Bilyeu?

  Now, so I'll lay out my argument for why go after Iran and Venezuela if you really are trying to box in China in a second. But so when you look at the way that Trump behaves, is it almost random neurons firing? And just entirely one guy's personality and like, hey, like, let's go after Iran today because why not? And let's go after.

• 45:21Speaker 01

  It's not even that positive. So you remember back to April 2nd tariff day? With the big game show boards?

• 45:30Tom Bilyeu?

  Oh, yes.

• 45:31Speaker 01

  I've got a contact in MAGA who's pretty up there. He doesn't like me. I don't like him. But we find one another useful. And so he called me at 1:30 PM.

• 45:45Speaker 01

  Eastern time, after he had had lunch at the White House and said, they haven't started negotiating, talking internally about what the tariff levels are going to be. And the announcement was supposed to be at four. I'm like, but this is like supposed to be the set piece. This is going to be the basis for everything. So, oh, Peter, Peter, Peter, there is no yesterday. There is no tomorrow. There is only the now.

• 46:12Tom Bilyeu?

  Yeah.

• 46:12Speaker 01

  And that's our foreign policy.

• 46:15Tom Bilyeu?

  Okay, that's distressing to say the least. You can feel that. But you really don't think Trump has an agenda, even if it's chaotic?

• 46:27Speaker 01

  He may have an agenda. It resets every morning.

• 46:31Tom Bilyeu?

  Interesting. Okay, well, that's clear. So I will, for the sake of me building a better mental map, let me confess, maybe is the right word, the way that I see it. And then you can help me align how to navigate a world in which this may just be false. So when I look at, and we'll probably have to contend with the Thucydides trap thing, because that drives a lot of my thinking. But I look at what Trump is doing, and I say, okay, here's a guy, business guy, pressing the advantage. He has a desired outcome that he wants. That desired outcome is for America to win everything. So, America first, you can read it as America only, or you can read

• 47:16Tom Bilyeu?

  it as, like, I think the right way to read America first is, America's going to take and do whatever it wants, because it's advantageous to America. So if we want Greenland, we're going to take Greenland. If we want to snatch up a dictator in Venezuela, we're gonna do it. If we wanna drop bombs on Iran, we're gonna do it. Like, literally, whatever Trump deems to be in America's best interest, he is going to do with no thought to second or third order consequences.

• 47:41Speaker 01

  A period foreign policy. Got it.

• 47:43Tom Bilyeu?

  So well said. Perfect. That sums up exactly how I see it. Okay. Now, I go, okay, but he understands that if you go after China in a head-on collision, and you were, I had never thought of it, but let's say, the very brilliant thing that you just laid out, you block their access to food and oil through a single shipping lane choke point, do that way easier, but that, that is a red line that obviously China's going to respond heavily against. And because we have not built in the things that we need on the American side from a production standpoint, that would be shooting ourselves in the foot. So he's gonna do a slower

• 48:24Tom Bilyeu?

  thing, he's gonna do something that's threatening, but that China can either ignore or respond to, but they don't have to treat it like an existential threat. And so he's doing the thing that doesn't quite back you into a corner, but slowly starts like constricting that threat.

• 48:43Tom Bilyeu?

  Period. So I guess, chapter one. Now, now I want to know from a

• 48:50Tom Bilyeu?

  for you that I think the the box is going to be, I just don't put that belief that Trump is strategic in that fashion as a base assumption.

• 48:59Speaker 01

  I would certainly agree with that statement. Yeah.

• 49:03Tom Bilyeu?

  Okay, so it is almost my thing, my breakdown is it describes the world that we see, but you believe that I'm off on the base assumption as to why Trump has done that.

• 49:17Speaker 01

  But again, if you're gonna smash China, there's simple, more direct ways and the Trump administration.

• 49:22Tom Bilyeu?

  Right, but contend contend with the, he wouldn't want to smash China in a way that felt existential.

• 49:29Speaker 01

  Fair enough. If you want a presidency that was preparing for a world where China loses, that would be the Biden administration. The Biden administration had plenty of flaws, but they actually did build some of the infrastructure that was necessary and built the alliance structure that was necessary to prepare for a post-China world. A lot of that, of course, is now gone. But, you know, I have a big problem with any strategy that doesn't plan for success, and we're not seeing that today.

• 49:56Tom Bilyeu?

  Not planning for US success or China's success?

• 49:59Speaker 01

  US success.

• 50:00Tom Bilyeu?

  Got it. Because he's too chaotic, because he's not thinking second and third order consequences, does not have the political positions filled that would see this stuff through to fruition.

• 50:10Speaker 01

  Well, just if if the goal is to defeat slash remove slash cow China, whatever you want to do, there's certain things you're gonna need the next day. And there's been no effort that I have seen in that direction. Until there is, it's really hard for me to describe anything to a strategy.

• 50:31Tom Bilyeu?

  That's it for part one. Make sure you are subscribed so you do not miss part two coming up soon.

• 50:40Tom Bilyeu?

  Let's talk about a pattern that is guaranteed to be killing your progress. You know what you need to do. You need consistent nutrition. We all do. You need vitamins, probiotics, greens. We all know that we should be doing more of it. When your morning gets chaotic, you skip it. When you travel, you skip it. When your routine breaks, everything tends to break. And that inconsistency compounds against you every single day. AG1 is designed to solve the execution problem. One scoop, eight ounces of water, and you're done. You're getting 75 plus ingredients, vitamins and minerals, pre and probiotics, nutrient-dense superfoods, everything that used to require six, seven different supplements, and perfect planning now happens in one drink that takes about 30 seconds to make.

• 51:25Tom Bilyeu?

  Right now, AG1 is giving you $87 worth of free gifts with your first subscription. You get a welcome kit, travel packs, vitamin D3 plus K2, and flavor samples. Click the link in the show notes or visit drinkag1.com/impact to claim this offer.