Arizona stands in good position as old global order collapses
The world as we know it has ended. It’s time for politicians and business leaders to recognize that fact and prepare for the emerging era.
This isn’t the chattering of some teenage doomscroller, but the conclusion of geopolitical strategist Peter Zeihan. In 2014, he correctly predicted that Russia would launch a war of expansion in eight years. And so it did. Zeihan’s latest bestseller, “The End of the World Is Just the Beginning: Mapping the Collapse of Globalization,” offers 500 insightful pages on how the old global order worked, why it collapsed and which countries will fare badly in our leaner, meaner future.
Everyone will take a hit, but the United States and Mexico can expect less disastrous outcomes due to geography, demographics and their long-term partnership. As a pro-business border state, Arizona is positioned for success despite the gloomy global outlook.
“Hoping for the best while expecting the worst” is wise advice, and Zeihan’s analysis puts into words and data what many of us see happening to the world around us.
Put briefly, the sages of post-WWII America created the Bretton Woods system, in which “the United
As powers reconfigure, opportunities open up for an even bigger US-Mexico economic relationship.
States disadvantages itself economically in order to purchase the loyalty of a global alliance,” Zeihan writes. “That is what globalization is.”
With the fall of communism and the failure of our naïve Middle East project, America is no longer interested in preserving the Pax Americana that protected sea lanes and stabilized hotspots for seven decades. As we withdraw, instability will rise.
The “rules-based international order” we assumed as our birthright is sliding into disorder, at least until a new equilibrium is reached. Will China take our place? Not so much. The Middle
Kingdom’s collapsing demographics and less-than-ideal geography and resource profile ensure it won’t be the next world hegemon.
“In 3,500 years of Chinese history, the longest stint one of their empires has gone without massive territorial losses is seventy years,” Zeihan writes. “That’s. Right. Now.” Other east Asian countries will struggle, especially those that need to import vital food and energy supplies. The Strait of Malacca, between Malaysia and Sumatra, is one of the busiest shipping lanes in the world; and the most susceptible to piracy. Europe requires massive energy imports to heat their homes and power their factories. Russian belligerence has already ended their primary source, the effects of which will be devastating. The picture is not as dire back home. The
U.S. can supply most of what its citizens need in energy, food and manufacturing. But all those factories across the Pacific must relocate to the States or at least nearby. Like in Mexico, say.
Companies already have launched massive nearshoring efforts over the past few years to gain a jump on their competitors. For all those production facilities relocated in Mexico, the majority of their wares will be shipped through Arizona, California and Texas. In 2020, the United States-Mexico-Canada Agreement (USMCA) reinvigorated the old NAFTA regime, strengthening ties between the three neighbors and stabilizing future trade.
Gov. Doug Ducey spent his two terms deepening the Arizona-Mexico relationship, expanding opportunity and creating jobs on both sides of the border.
He just left for another trade mission to Mexico last Sunday. They’re our largest trading partner by far. In the tech sector, Congress passed the CHIPS Act this summer to strengthen domestic semiconductor manufacturing, design and research, and fortify our chip supply chains. Already a semiconductor hub, Arizona is an ideal home for these efforts, providing jobs and economic strength in our new world disorder. Given our low tax, low regulation and business friendly policies, Arizona is primed for success despite an uncertain global future. Now it’s up to our newly elected leaders to keep these advantages in place.