The End of the World is Just the Beginning: Mapping the Collapse of Globalization

by Peter Zeihan

At the end of World War II, the Americans created history’s greatest military alliance to arrest, contain, and beat back the Soviet Union. That we know. That’s no surprise. What is often forgotten, however, is that this alliance was only half the plan. In order to cement their new coalition, the Americans also fostered an environment of global security so that any partner could go anywhere, anytime, interface with anyone, in any economic manner, participate in any supply chain and access any material input—all without needing a military escort. This butter side of the Americans’ guns-and-butter deal created what we today recognize as free trade. Globalization.

Since 1945 the world has been the best it has ever been. The best it will ever be. Which is a poetic way of saying this era, this world—our world—is doomed. The 2020s will see a collapse of consumption and production and investment and trade almost everywhere. Globalization will shatter into pieces. Some regional. Some national. Some smaller. It will be costly. It will make life slower. And above all, worse. No economic system yet imagined can function in the sort of future we face. This devolution will be jarring, to say the least. It’s taken us decades of peace to suss out this world of ours. To think that we will adapt easily or quickly to such titanic unravelings is to showcase more optimism than I’m capable of generating.

The 1990s were a nice decade for most. Strong American-provided security. No serious international conflicts. Global trade penetrated deep into the former Soviet space as well as into countries that had done their best to sit out the Cold War. The cost of the American overwatch and market access steadily expanded, but in an environment of peace and prosperity it all seemed manageable. Germany reunified. Europe reunified. The Asian tigers roared. China came into its own, driving down the price of consumer products. Resource producers, whether in Africa, Latin America, or Down Under, made scads of money helping more parts of the world industrialize. Globe-spanning supply chains made the Digital Revolution not simply possible, but inevitable. Good times. We all came to think of it as normal. It is not. The post–Cold War era is possible only because of a lingering American commitment to a security paradigm that suspends geopolitical competition and subsidizes the global Order. With the Cold War security environment changed, it is a policy that no longer matches needs. What we all think of as normal is actually the most distorted moment in human history. That makes it incredibly fragile.

On the farm, having children was often more an economic decision than it was about love. Children were free labor that were de facto chained to their parents’ economic needs. There was an understanding—rooted in millennia of cultural and economic norms—that children would either take over the farm as their parents aged, or at least not move all that far away. The extended family formed a tribe that consistently supported one another. This cultural-economic dynamic has held true since the dawn of recorded history, even to and through the consolidation of the world into empires and nation-states.

Globalization was always dependent upon the Americans’ commitment to the global Order and that Order hasn’t served Americans’ strategic interests since the Berlin Wall fell in 1989. Without the Americans riding herd on everyone, it is only a matter of time before something in East Asia or the Middle East or the Russian periphery (like, I don’t know, say, a war) breaks the global system beyond repair . . . assuming that the Americans don’t do it themselves.

The time-staggered nature of the industrialization process—from Britain to Germany to Russia and northwestern Europe and Japan to Korea to Canada and Spain—combined with the steadily accelerating nature of that process, means that much of the world’s population faces mass retirements followed by population crashes at roughly the same time. The world’s demographic structure passed the point of no return twenty to forty years ago. The 2020s are the decade when it all breaks apart. For countries as varied as China, Russia, Japan, Germany, Italy, South Korea, Ukraine, Canada, Malaysia, Taiwan, Romania, the Netherlands, Belgium, and Austria, the question isn’t when these countries will age into demographic obsolescence. All will see their worker cadres pass into mass retirement in the 2020s. None have sufficient young people to even pretend to regenerate their populations. All suffer from terminal demographics. The real questions are how and how soon do their societies crack apart? And do they deflate in silence or lash out against the dying of the light? Coming up behind them—rapidly—is another cadre of countries whose birth rates have dropped even faster, and so who will face a similar demographic disintegration in the 2030s and 2040s: Brazil, Spain, Thailand, Poland, Australia, Cuba, Greece, Portugal, Hungary, and Switzerland.

In a safe, globalized world such a hybridization model can limp along so long as the commodities flow out and the money flows in. But in an unsafe, fractured world where trade is sharply circumscribed, outright national collapse will by far not be the biggest problem these peoples face. In these countries the very population is vulnerable to changes farther abroad. The industrial technologies that reduce mortality and raise standards of living cannot be uninvented, but if trade collapses, these technologies can be denied. Should anything impact these countries’ commodity outflows or the income or product inflows, the entire place will break down while experiencing deep-rooted famine on a biblical scale. Economic development, quality of life, longevity, health, and demographic expansion are all subject to the whims of globalization. Or rather, in this case, deglobalization.

The world currently has two reasonably disturbing and disturbingly reasonable examples as to what this unraveling might look like: Zimbabwe and Venezuela. In both cases mismanagement par excellence destroyed the ability of both countries to produce their for-export goods—foodstuffs in the case of Zimbabwe, oil and oil products in the case of Venezuela—resulting in funds shortages so extreme, the ability of the countries to import largely collapsed. In Zimbabwe, the end result was more than a decade of negative economic growth, generating outcomes far worse than those of the Great Depression, with the bulk of the population reduced to subsistence farming. Venezuela wasn’t so . . . fortunate. It imported more than two-thirds of its foodstuffs before its economic collapse. Venezuelan oil production dropped so much, the country even lacks sufficient fuel to sow crops, contributing to the worst famine in the history of the Western Hemisphere. I don’t use these examples lightly. The word you are looking for to describe this outcome isn’t “deglobalize” or even “deindustrialize,” but instead “decivilize.”

A precious few countries have managed a high degree of development while simultaneously avoiding a collapse in birth rates. It is . . . a painfully short list: the United States, France, Argentina, Sweden, and New Zealand. And . . . that’s it.

We aren’t simply looking at a demographically induced economic breakdown; we are looking at the end of a half millennium of economic history. At present, I see only two preexisting economic models that might work for the world we’re (d)evolving into. Both are very old-school: The first is plain ol’ imperialism. For this to work, the country in question must have a military, especially one with a powerful navy capable of large-scale amphibious assault. That military ventures forth to conquer territories and peoples, and then exploits said territories and peoples in whatever way it wishes: forcing conquered labor to craft products, stripping conquered territories of resources, treating conquered people as a captive market for its own products, etc. The British Empire at its height excelled at this, but to be honest, so did any other post-Columbus political entity that used the word “empire” in its name. If this sounds like mass slavery with some geographic and legal displacement between master and slave, you’re thinking in the right general direction. The second is something called mercantilism, an economic system in which you heavily restrict the ability of anyone to export anything to your consumer base, but in which you also ram whatever of your production you can down the throats of anyone else. Such ramming is often done with a secondary goal of wrecking local production capacity so the target market is dependent upon you in the long term. The imperial-era French engage...