Transcription
Welcome to World Affairs and Context, everybody. Today, I'm absolutely thrilled to welcome back a fantastic guest, Anar Tanyen. Aar is a Beijing-based political and economic expert, known for his nuanced perspective on US-China relations, geopolitics, and the shifting balance of power in the 21st century. As a senior fellow at the Thai Institute and a frequent commentator on international media, Aar brings a rare cross-cultural lens, shaped by decades of experience in business, law, and diplomacy. Aar also runs a wonderful Substack, which I read religiously and highly, highly recommend. I will link it below. Please give him a follow. Aar, welcome back to the program. It is so great to see you again.
Thank you, Lena. You're much too kind. I, I, I should also mention that I was, um, a little while ago, made a senior fellow at the Center for International Governance Innovation, which is a think tank based in Windsor, Ontario, Canada, and, uh, I'm greatly honored, uh, to be a senior fellow there, as well as a couple of other places.
Absolutely. Congratulations. And I know this is absolutely incredible, the amount of work that you do and, uh, the expertise that you share. And I'm absolutely happy to have you back on the program because, uh, there are just so many things going on. And here in the US, and I'm sure in the West in general, we hear so many conflicting narratives and stories. And, you know, it's, it's, it's virtually impossible to know what to believe. So, I really do appreciate you taking the time and, and joining me today.
You've often argued that China prioritizes stability over confrontation, and any fair observer can certainly agree with that. But the problem is, international relations are becoming increasingly volatile and unpredictable. Right now, we're observing hybrid warfare with military, economic, and psychological tools being used at the same time, simultaneously, to assert dominance, control access to resources, and also to technology. The war in Iran certainly exposed Washington's militarism, once again. There's nothing new there. But also, it brings to light the challenges that are, um, faced by the global majority when it comes to countering American exceptionalism, uh, its perception that it is above international law and above morality. So, to set the scene, how does Beijing actually view the Iran conflict and the conflicts in the broader Middle East?
Okay. So, so there, you're asking actually a many-layered, uh, question. Okay. So, on globally, uh, as you were, um, talking about, there, there's a conflict between two different visions of the world. One is the US vision, which, uh, says, you know, American, um, exceptionalism. America needs to be in charge of the world, regardless of cost. Uh, it needs to have a hegemony that is economic, political, and military, in order to guide the world and prevent World War III, or to prevent other wars. Uh, China has a different view. Uh, they draw on their years of history, and they say, you know, we approach this from a civilization point of view. And they, their argument is that, look, um, wars beget more wars. Uh, it is better to find peace. Uh, what is necessary when you have a world that is multipolar is, you have to have, uh, you know, some basic values. And those values are not ideological, not like the United States. Uh, their values are: every country needs to be secure, and their security cannot depend on the insecurity of another country. Uh, every country has the right to choose its own path to development, and no other country has the right to interfere with their internal development and their choices in doing so. Lastly, every country, uh, today is, in most senses, an accident of history. Uh, whether it was royal families or, um, fairly cynical plays by, um, colonial groups who were trying to put, uh, minority groups in charge of majority groups. So the minority groups would be dependent, guess on, guess who, uh, their, um, colonial benefactors. Uh, so the world exists today. Uh, and each country is, in essence, a mosaic of different groups, languages, cultures, often histories. Um, there are enmities within, and but they need to settle those. If you start taking apart countries based on, "I don't like them," or, "You know, my grandmother is from a different place than your grandmother was from," it would never be, it would be never-ending. So, from China's perspective, you have to start understanding countries the way they are. Do not rewrite their history. Do not write them out of history, as happened with Africa and also in the Middle East. They pretend that, you know, people are jumping around either, you know, it's, you know, on the sands with camels, or they're running through the jungle, you know, in loincloths, or something like that. Nothing could be further from the truth. These are, are these civilizations are ancient. They were the cradle of civilization. Uh, they did things before, um, you know, the Western powers were even thinking about them. And, in fact, you know, with a thousand years of, of, um, invasions under, uh, the auspices of, um, you know, religion, basically the Crusades, they were coming down. They were, they were, in fact, the barbarians coming down to areas where there were riches and trade and silks and things like that, and they're anxious to take those. So, you have to respect countries the way they are. You also have to respect their sovereignty. Uh, the collective, whatever they are, that is something for them to decide internally. Uh, externally, countries have to respect that. And then, finally, uh, this idea of a global governance system, which is really just saying, you know, how do we sit down at a table and create consensus, not dictated peace, not telling you what it's going to be, or telling you how to run your country, but how we can sit down when there are problems, and invariably, there are problems, um, frictions that you have to settle, and you want to do it at the table, otherwise you fight needless deaths, and then you still end up at the table. So, this is, uh, how China does it. And why people always say, "Oh, well, that sounds very, you know, very high and noble, but, you know, the realities are, everyone's out for themselves." Well, in a sense, China is pursuing its own interests, but it believes in win-win. China is a country. There are 195 countries in the world. China is a country that is about 100th in terms of people to resources. So, they're in a position where they have to import resources, and then to pay for those resources, they need to add value to them and then export them. This is also, can take care of their internal demands as well. So, they need peace very much so. But I think everybody would like to have peace. So, this is not contrary to anybody's, uh, view of things, unless you see it as a kind of existential threat from the US point of view, because you don't want countries making peace when you're trying to destabilize them. So, this is a long way of prefacing what your original question is: is how does China see this? Obviously, given what I've said, China does not want war. Um, I don't think anybody really understands why Donald Trump went into a country which six other presidents said, "No, we're not going to go in there. We, we don't have good relations. We're not going to go in there," because we know they control the Straits of Hormuz. Uh, whether it was back in the old days of mining it, or sending ships in, they knew that they could not control them. It's too long of a coastline, and it affects a huge percentage of the world's energy. Today, it's around 20, 21%. And this is not just oil, it's also gas. So, what, what is China trying to do about it? Well, they're not doing what the United States is doing, and that is trying to impose its terms on the 17th largest country in the world by both population and area, that being Iran. Uh, who, who is driving this? Actually, it's Israel. And when I say Israel, I, I should say it's the Zionist part. 30 years ago, there was a white paper called "Clean Break." It said "Defense of the Realm." And it was given to Netanyahu quite early on during his first term in power. And what it said is, trying to negotiate peace will never work for Israel. Too small. Uh, you know, it's, it's just these other countries will overwhelm you eventually. So, the plan was to disrupt any government or subservient the rest of the governments into either, you know, going along with whatever Israel wanted to do, or having face, having their, um, their governments destabilized and their economies destabilized. Well, you can look over the last 30 years at what happened. Uh, basically, they followed the, the blueprint. Uh, and if you have any questions about that, please go, go see this. It was, uh, done by Richard Pearl. It was given to Netanyahu, and this was in 1996. So, it became the blueprint and the official baseline of, um, Israeli foreign diplomacy, or not diplomacy, war. So, the one thing they cannot do is, because Israel is 7 and a half million Jews, uh, there's 2 million Arabs there, but not even slightly more than half of the Jews agree with this kind of radical Zionism. Uh, so, you're, you're essentially saying there's 3 and 3 and a half million plus change of radical people. Some there are supporters outside, but, you know, there are only 16 million Jews worldwide. Are, in essence, been pushing this agenda. But they can't go against a nation of 92 million people, which is Iran. They needed to have the United States step in. And for years, I mean, you go back 30 years ago, Netanyahu was claiming that within a few months, Iran will have a nuclear weapon. And over that last 30 years, it's been a few weeks, few months, then a few weeks, and, you know, any day now, all this kind of stuff. So, he's the original boy who called nuclear wolf. Fortunately for the world, he found somebody who was in a position, uh, Donald Trump, beset with domestic woes because his economic plans don't work, and also political woes in the sense that, uh, these Epstein files, 6 million pages, in which he's named, you know, somebody said a million times, uh, a close association that he's trying to step away from, but these, these pages do not lie. Nor do the many, many pictures, uh, in which he is associating with this child molester. So, he was at a perfect time. Uh, Netanyahu convinced him that this was going to be easy, that it was going to be exactly like Venezuela. You walk in, you declare victory, you take some oil, and you're, you'll be the hero, and you can go into the midterm elections saying that you're a strong man and that you create peace by, you know, being tough. Well, that's, it was a complete miscalculation, and he finds himself in a position where he wants to get out of Iran. He just doesn't know how. He's painted himself into a corner. Part of which goes back to the JCPOA. This is the agreement, um, that was negotiated by Obama, that was supported by Europe, which said that they would forego, um, enriching their nuclear materials by, in essence, giving it to Russia and not engaging in any kind of bomb-making or nuclear, um, weapons. But Trump tore that up. Well, when he tears, you tear up an agreement you have with somebody, it destroys trust, eats away at it. How, what, what's the point of having an agreement if you know the next president, or tomorrow, you tear it up? That was exacerbated by these last two, um, what do you call them? I'd like to say peace talks, except they weren't peace talks, because in each case, the United States said, "Let's talk peace," and then before the peace talks were over, they attacked, making it look like the peace talks were simply a ruse in order to, um, prepare, uh, their, their attack plans. And that's exactly, uh, what happened. So, at this point, there is no trust. So, China, um, is in a situation where it's trying to figure out how to build a trust table. And it's not just going to be China. I mean, you have a plan that was put forward by Pakistan in collaboration with other Gulf states, um, trying to push this idea that, you know, there's five basic principles: stop the war, stop the killing, let's, let's sit down and talk. Um, and unfortunately, that didn't, that did not work, did not take. Uh, you still see both sides pushing at it. Now, what's happening here? The United States can't get away from a war that Israel, uh, in essence, put them into. And Iran is in a situation where their spiritual leader and head of state, uh, was killed along with a huge number of their leadership. Uh, they were prepared for this, and they are seeking revenge. And they think that the only way that they can get to the United States is not militarily, but by surviving and controlling the Straits of Hormuz. Because if 20% of the world's oil is taken away, it's not just energy, it's food. Food is something you cannot do without. And in that particular instance, uh, they say, "Okay, we're willing to let the rest of the world suffer in order to get at the United States, to reduce the United States to a point so that the next time they sit down at the negotiating table, the US is well aware that they do not hold all the cards, and that they have to come to some sort of negotiated settlement, which in this case is going to include reparations for all the damage they did, which is somewhere between 20 and 50 billion dollars." As of now, more is happening. So, obviously, the, the tally will go up. Um, and it's not clear how they want to handle the nuclear situation. Iran says, "We'll forego it for five years." Um, the US says, "No, you have to forego nuclear, um, enrichment for 20 years." But behind all of this is one element that will prevent any long-lasting peace or denuclearization in the Middle East, and that is the fact that Israel has between 118 and 120 nuclear weapons. It's the worst-kept secret in the world. You know, the UN has called on them to, uh, register their weapons, to, you know, join the non-proliferation group, you know, but they don't. And they, they act with impunity because they have the support of the United States. But, you know, I, I can't imagine that having one belligerent state, Israel, with nuclear weapons, uh, you know, won't ignite a nuclear arms race in the Middle East. And, uh, regardless of what a country says, I, I do believe that they think that the only way they can protect themselves is to have a nuclear weapon. And if Iran has it, you, I can bet you Saudi Arabia will get it. Perhaps UAE, um, and, you know, other countries out there, obviously Turkey, Egypt, would be, uh, good candidates for that have the sophistication and the nuclear materials to do it. So, this, this is, if you're going to have real peace there, there's going to have to be a denuclearized Middle East, and that means Israel will be forced to give up its nuclear weapons, and that is not something that I foresee in the near future. It would have to be a calamity where their economy has been so collapsed, that they have no choice. Kind of, um, Westphalian peace. Um, if people remember, this was the 100-year war between Protestants and Catholics, where they would routinely go across their borders and slaughter entire villages, putting it to fire. They would kill men, women, and babies. And they would do this tit for tat. Uh, they finally got to the point where they were so bankrupt and so tired of killing each other that they sat in separate villages five miles apart, and some guy wandered back and forth through the mud of the spring carrying messages until they agreed that you should be you, and I will be me, and we will have a border, and what you do within your border is your business, not mine, and what I do within my borders is my business, not yours. And that ushered in that simple fact, ushered in the longest period of peace in Europe. So, let's get to, you know, what people always ask. Oh, well, is, is China about to collapse because they don't have oil? China, it gets about 11 million barrels per day from, or they did, from, uh, the Gulf area. It's not the total amount that they're bringing in, but it's the, the majority of that. About somewhere between 1.2 and 1.5 million barrels came from, uh, Iran. So, when you hear this number that 90% of Iranian oil is going to the US, you have to remember it's a very, very small number in comparison, well, not very small, but it's a smaller number in comparison to the amount that they, um, get from Saudi Arabia and other places, along with gas and things like that. Uh, so China can do certain things. Uh, they can increase the amount of gas and oil that is coming through the pipelines from Russia. They can increase, uh, their own production by a minimal, but you're only talking most two, two and a half million barrels. So, you have this deficit. And then, then there's what we call demand destruction. That means when the price goes up, people look for alternatives. And it could be, I was used to be running a, um, a pump, a water pump for my irrigation system using diesel. Diesel's too expensive. Okay. I went out and bought an electric motor that runs off a couple of, um, solar panels. And so, so the destruction is there. I'm not going to use that. I use something else. So, between all that, between, it'll be about six to seven million barrels a day that is a deficit for China coming from the Gulf. They can continue to look for other sources. Obviously, the Stan areas countries, they have oil and gas, but it takes time to build, um, pipelines, set up logistic lines, and things like that. What does China have? They have between 1.2 billion and 1.4 billion barrels of oil in their reserve. It's the largest reserve in the world, and that gives them enough coverage easily for a couple hundred, maybe more, depending on what, what they actually have, days. And that is the short term, and they have that covered. In the intermediate term, China's, um, in the process of bringing online 20 nuclear reactors. They will produce a lot of electricity. The idea is to, um, supplant coal, have about 30% of the nation's total energy coming from the nuclear side. And then, in addition to that, everyone knows that they're the kings of solar and also wind power. Wind power takes a little bit longer. Solar is a little bit easier and faster to set up. Already, you're hearing more and more about farms being set up, solar farms being set up, um, and, uh, areas within cities adopting solar panels so that they can supplement their, uh, energies. China also has the most advanced transmission, um, things. It's fine to say I have energy here. Unfortunately, generally, where you have the energy is not where you have the demand. China can bring, um, energy, electricity generated in Xinjiang, which is thousands of miles away from the East Coast, and they can bring it to that area with, uh, only 20% energy loss, which, although it sounds like a lot, is quite a bit less than the antiquated systems that are, you know, in many places, including the United States. So, they have some technological aspects. In terms of the long term, uh, China has put, uh, before any of this happened, they put in their 15th five-year plan that they want to have a working fusion power plant. Fusion is different from nuclear in that it's very hot. Use it uses a heavy isotope of deuterium, um, and it splits it across, and it creates a tremendous amount of heat, and we use that heat to drive steam turbines, and that those create electricity. If that happens, it's clean, it's safe. It's not like nuclear. There's, there's no danger for radiation, and there are no after-effects that are bad. So, it would be almost a limitless, cheap energy source, which would change the world, and certainly would change oil. Now, the other thing people should realize is, out of all the oil, 60% is used for energy, in the sense of, you know, driving cars, transportation things, jets, etc. 40% is used as a feedstock in processes. You know, the clothes you wear, perfumes, um, all goes into all goes into that. There's so many different uses for these long complex hydrocarbons, medicines, etc. So, those will continue to be in demand. There might be some substitutes. They're going. So, eventually, you're going to see a switch away from energy towards these feedstocks. So, China's in a good place right now compared to other countries in terms of, you know, at least absorbing the shock. I would argue that the short term, they're kind of on par with most of the nations. Europe has about 90 days. The US, um, because they drew down their stocks, um, has less, but on the other hand, they're a big producer, so it doesn't apply that much to them. But places like Japan, South Korea, Indonesia, India, they are in real, real trouble. And the other part of energy that I had to mention is fertilizer. And I, what I mean by this is that, uh, gas, natural gas is stripped of its nitrogen, and that nitrogen becomes the basis for fertilizers that are used around the world. In fact, about 20%. So, what's the difference if I have fertilizer on my crops versus I don't? Well, let's say you have wheat, somewhere between 15 and 25% decrease in your yield. So, instead of, you know, 100,000 bushels, I would have 75,000 bushels. That means there's going to be a food shock. In addition to that, if I don't have the diesel to run my, you know, irrigation pumps or my tractors in order to plant, harvest, tend, I'm going to be in serious trouble. If I miss the planting season, it's gone, and the whole crop is gone. So, you have areas now where they, they cannot, it's not even a question of price. They cannot get it. And this is really hampering now. Governments are trying to react. They're doing the best they can, but without fertilizers and without the energy, uh, it's going to be pretty bad. And, you know, people say, well, I don't know, what does that mean? Say, okay, a loaf of bread, it's between 15 and 25% energy. Why? Well, uh, you, you, you have to have the fertilizers, you have to have the tractors, the irrigation, you have to, uh, harvest it, you then have to, you know, send it off to be ground up, made into flour, baked into bread, uh, and then distribute it. Guess what? Every single step takes energy. So, we don't, you might not think about it, but when you're having your sandwich for the day, you are eating, as I said, between 15 and 25% pure energy. And this, this exacerbates a situation that we have now. Remember, the energy markets are basically in equilibrium. They don't want to have too much production if there's not enough demand, because the price drops. On the other hand, people don't want, um, shortages, and the price goes up, and that has severe economic, uh, effects. To give you an idea of how much. All right, right now, we're looking at 20% of the world's energy. Back in 1973, OPEC withdrew between 7 and 9% of the world's energy because they were forming OPEC, and they said, "We're going to have an embargo to teach you that, you know, you, you can't shortchange us anymore for the price of our resources." That caused energy, a barrel of oil to go up four times. So, it went from $12 to $48. You go to 1979, the Iranian revolution, that took somewhere between 3 and 5% of the world's oil off the market, and resulted in the price doubling. That was true again during the, uh, Russian, um, Ukrainian war, which is still going on. You saw roughly a doubling of the price because of that. And obviously, there, you know, there were things going on where there was, it was doubling across a long period of time, but there were spikes there where, uh, oil and gas and things like that were going through absurd amounts in the spot market because people can't do without it. Can't eat my home, right? I can't fly the jet. I can't plant my, uh, garden. I don't have fertilizers. These are all things that get, uh, affected. So, with, you know, literally more than two times the amount of oil being withdrawn as it had in 1973, where it went up four times, you could easily see this going up between four and six times. Well, where were four? Somewhere between $60 and $80. You multiply that times four to six, you have a pretty nasty number. And that number means that the world could go into a global recession or even a global depression. So, I, unfortunately, I don't have a lot of good news. But what I'm telling you is that China does not think it can win, right? It sees the damage the US is doing to itself. But this isn't about winning. This kind of war can never be won. Global demand drops. That affects the Chinese economy. Remember, they, they want to get resources in and sell value-added, um, goods out. So, this really cuts into them. It ruins, uh, the plans and efforts they've been making about over $1.3 trillion dollar that they put into the Belt and Road Initiative to build the infrastructure for a global trade system. You know, that's, that's put on hold for a while, as, you know, people are just trying to get to the basic, their basic needs of, you know, food. So, this is not a good situation for China, but in terms of dealing with it, they're prepared much better than, uh, other countries. So, at this point, China wants peace. They would like to be part of it, but it's not the old ways of making peace, uh, where, you know, when it was the United States or Europe, their idea of making a peace means taking a piece out of whoever they were negotiating with. China just wants to see, um, something that's lasting, where the parties come together, and they, you know, they agree to cooperate, they understand each other's positions. It's not that everybody wins exactly what they want, but they come to a consensus that they can live with. And that, to me, and I think anyone who's sane, is an indication of something that could be long-term in terms of peace negotiating, as opposed to imposing whatever it is you want on somebody you think is weaker, and having them waiting in the weeds, you know, bowing revenge when the time comes. So, that's a long-winded way. I hope I haven't too long, uh, saying where, where China is and where the global situation is heading.
This is absolutely fascinating. Um, I've seen two divergent opinions on the impact of the war in Iran on China. The first category believe that China is the main sort of objective, um, because, you know, its oil supply is being disrupted. However, as you just pointed out, China has insulated itself against a near-term disruption in energy supplies. It has a massive oil stockpile, which is now estimated at 1.4, 1.4 billion barrels, as you mentioned. And it does seem fairly, I would say, um, unreasonable to assume that going to war was meant to hurt China. I think there's probably an element of that that has to do with the United States wanting to control energy flows and sort of reassert its dominance over the oil market. But it, it doesn't seem to be the primary reason. And then there is the second group of people, among whom are prominent Western academics, who say China is a silent beneficiary of prolonged instability in the Middle East. Foreign Affairs just published an article titled "The Iran War is a Win for China." And in that article, they argue that in military terms, China is effectively learning, observing, and learning from how the United States intercepts missiles, what weapons it's using, you know, how its decision cycle is operating. And so, in that sense, they say, well, China is clearly a winner here. What is your take on these claims? And do you believe there's any truth to them?
Okay. Uh, let's, let's deal with the second claim first, because we can dispose of it quite quickly. If you and I are playing football, soccer, however you want to put it, and I decide to kick the ball in my own goal. All right. Yes, you're winning because I kicked the ball in my own goal, and that's against my interest. That's the United States, right? So, these academics who, they're trying to infer that there's some malign, malicious intent on us, that somehow the US got Donald Trump in a position where he would declare war on on Iran, when in fact, if you want to look at the, you know, where that came from, it's clearly coming from Netanyahu. But as I said, this is, um, you know, a good way of deflecting, um, you know, kind of attention away from it. So, let's go, uh, to your first question, uh, which is really, um, my understanding is you're saying that, you know, China is winning because they, they know everything that's going on and, uh, they're timing it and things like that. This is the assumption, and this is always what I find interesting. When I was a prosecutor, all right, I noticed there was a pattern, uh, when I would, and also I was a defense attorney. There's a pattern among criminals. What they would do, if you have a thief, what they would tell you is, in essence, you know, I, my only crime was I got caught. Everybody's a thief. I was just trying to get something before somebody took it from me. So, it's a rationalization. Basically, they're saying that everybody thinks the way I think. I'm just, you know, doing what I can before they do it. And this is the, the idea behind a defensive attack, right? A preemptive attack, because I know exactly what you're going to do. Why? Well, because it's what I would do in your situation. And this is exactly, uh, what the, this, this brand of academics is always pushing. China is not like the United States. As I said earlier, China takes a different view. Uh, it's one that's based very much on the practicalities of their economy, but also one which they believe can lead to, uh, you know, a shared future for mankind. I know that's, people say, "Oh, that's trite and silly. You know, mankind's been at war forever." Well, isn't it worth a shot at trying to stop that, to try to figure out where you can have more equality, uh, less disparities? Um, perhaps we can, you know, with especially if there's free, a very cheap and abundant energy, much as possible, you can expand the areas you can live with, because, you know, heating your home if you're in the Arctic, or cooling it if you're in the, um, in the, you know, in the jungle, no problem. You have lots of electricity. You can, you can grow things. You can extract water from the air. You can literally live in the desert, uh, if you have enough energy and hydroponics, things like this. It changes everything dramatically. So, why not envision a world where we don't fight each other, but we benefit from having trade? Is that so horrible? You know, this is the part I find very puzzling. A number of academics and people who just assume that China has the same evil intent that their country has been doing for centuries. And, uh, I, you know, I, I see that is one of the largest impediments, uh, to coming to any kind of, you know, compromise here, is that everyone assumes, not everybody, um, but people in the West, especially in Washington, assume they're kind of everyone is going to do what we would do. And what we would do is take advantage of everybody. So, this is the kind of thinking that you get. I, I, I see it on television stations from India to, uh, the Middle East, Europe, Asia, etc., on a lot of different stations in a year, over 50 different ones. So, I, I listen carefully to the questions, because they are the ones that really tell me how people are thinking, right? An answer can be changed, but if you ask me a question, I can kind of figure out where you're going and how you're thinking about things. So, you know, what I suggest to people is, is stop, you know, looking at the answers all the time and start looking at the questions, and maybe you'll get a, a much better idea of what's going on.
I love your metaphor where you compare it. It's, it's kind of like playing football, right? And, and the United States has consistently effectively just, um, you know, it, it shoots itself in the foot because it, it does, it does seem to operate in its own universe in a way where every other state is a threat automatically. And it's, it's very interesting how the Trump administration amplified that sort of need to seek hegemony and to, uh, seek dominance at the expense of interests of other nations. Trump's war of choice in Iran has come at the expense of the United States' power projection in the Asia-Pacific region as well. The United States had no choice but to move military assets from East Asia to the Middle East. And this was an unmistakable signal of Washington's true priorities in the Middle East. There's a good argument to be made that the United States military bases would have to be reconsidered once this war, hopefully, ends, because the Gulf States may not want to, they would want to expand their, uh, partnerships and alliances in terms of not just relying on the United States anymore, possibly. But what impact has this had on, um, Japan, on South Korea, in terms of their reliance on the American military umbrella?
Well, yeah. I mean, in the Middle East, um, I, I know a fair number of people from there at higher levels, and it's quite clear, um, they thought a US military base was a shield and that it would protect them. And now it's turned out that, uh, it's not a shield, it's a target. The US chose to protect Israel, uh, not even their own bases, not even their quote, other partners. So, they clearly know that, uh, they are nothing in comparison to the priority of Israel. That obviously is moving them to reconsider their options. I think Qatar has announced that they would like to see the base leave. I would wager that Saudi Arabia is rethinking having a base there as well. They've also indicated that they intend to start buying arms, uh, from other places, and not be totally relying on the US, especially after Trump personally insulted the Crown Prince. Not something wise to do. But, you know, here's, here's a gentleman, um, within the space of one week, he alienated the top three religions in the world. Um, obviously, his, his Sunday morning, Easter Sunday morning, one of the most religious days in Christianity, profanity-laced, um, you know, message ended with, you know, this ironic, uh, salute to the Muslim world, and then fighting with the Pope. And then at the same time, he starts to put out these memes of him dressed as Jesus. Well, him dressed as Jesus doesn't sit well with evangelicals. They read the Bible and they say, you know, no, no, no, you don't do that. We don't worship false idols. And now you have Tucker Carlson who is openly saying, well, perhaps he's the Antichrist. Perhaps we have been fooled. Um, and this is taking hold, um, among his people, as well as this idea that he set up the shooting of himself in terms of his ear and things like that. I don't believe it. But, um, my point is that his MAGA base is fracturing as we talk. Joe Rogan and the people who used to support him have turned on him, and he's in, you know, a very, very, very difficult position. So, why am I mentioning this in terms of South Korea and Japan? They look at Donald Trump and they said, we don't want to cross him because we don't know what he'll do, or we do know what he'll do. He'll take punitive measures to the extent that he can, and, you know, you know, basically ruin our markets, make everything less certain than the massive uncertainty we already have. So, they try to, you know, just either escape his notice or downplay it. We saw the circus that went on when the Japanese PM visited him, and he decided to make a reference to Pearl Harbor in terms of surprise attacks and this type of thing. I mean, um, even it's just, it's unbelievable in terms of diplomatic messages. And they realize that they have to make alternate plans, both for their security and also for their long-term trade. It, it'll be interesting to see where they go. They are three countries. Um, they both have a considerable amount of business interest in China. Um, but they may choose to try to shore up more business with Europe or Africa, India, or wherever. They're free to do that. But they know that there is no long-term future in terms of relying on the US, either militarily or economically. So, this is, this is kind of where, where they are. Um, obviously, it's going to be subject to, uh, the political process. And I can tell you without a doubt, um, because of the food shock that's going to happen, you're going to, when there are elections, um, you know, after next fall, when there are elections, you're going to see a lot of changes in governments because they're going to be blamed, unfortunately, for the actions of other governments that they could not control. But, you know, people being what they are, they will vote their pocketbook, and their pocketbook says, you know, we're not doing well. Let's see if the other guy who's making vague promises about making everything better, see if they can do it.
This is absolutely interesting because I think that the economic impact of this war is enormous and it has yet to be felt. I was really fascinated when, um, Financial Times published an article describing that several ships have paid Iran tolls in Chinese yuan to pass through the strait. So, the war certainly creates precedent to really diversify away from US-led and Western-led institutions and systems, including energy trade settlements and to decrease the use of the dollar. What do you think this war would mean for the global energy markets, for their sort of focus, investment focus in the Middle East on its infrastructure due to its resources, of course? But do you think that this war would actually lead to a completely new financial and economic architecture in terms of energy trade, in terms of financial settlements, and also the role of foreign states, um, globally in that new framework?
Well, yeah, I, I think you're asking the exact right question. I mean, what, what happens now? We, we can look at what happened, uh, in 1973. Um, after that, that completely changed everything. Uh, the markets changed. They, they then came in with the petrodollar, that changed everything. Um, you're going to see there was a massive amount of recession. Remember in the '70s, they had these huge interest rates, you know, 15, 16, 17% in the United States, um, and, you know, you could possibly have again. Remember, there's $39 trillion and growing of US deficit, federal deficit, no plan to pay it back. In fact, there's, uh, already pre-approved, uh, trillions more that will be added to it. So, you have a, a pretty, uh, dire scenario where the reason I mentioned the deficit is because those are generally held in, held in the private side or by government side pension funds, whatever, in form of Treasury bills. And those Treasury bills have to have buyers. They don't have buyers, and the interest rate has to go up higher so it can attract buyers. So, you know, buy-sell market. So, um, when interest rates rise, new debt has to be paid off. I mean, if I redeem some debt and issue new debt, that's going to be at a higher level. If I issue just new debt by itself, it's going to be at a higher level. So, my costs go up, and, um, that's not good for the US. It's all, the US already runs a $2 trillion regular deficit because the inflows of taxes are two trillion less than the, um, amount that is spent. So, I think it's pretty easy to figure out. We're just continuing to borrow it with no plan of how to pay it back. So, you know, the, this, the situation is increasingly becoming dire, uh, for the US. And in terms of, you know, how this affects global settlements when they're having, um, you know, oil markets roiled by these additional fees. Well, okay. So, let's say, uh, a large tanker carrying 2 million barrels of oil is hit with a $2 million, um, fee. Well, it's a dollar a barrel. That, that, that can be done. All right. What does it mean to, um, Iran? It's about $50 billion a year, which means that they could, uh, get reparations, rebuild their country. They don't have to rely on, uh, actually exporting oil because basically there's very little cost, just the coast guard cutters and the threat, few mines. The threat that if you to go through there, we will, you know, we'll get you. And, you know, if, if you, the only way to do it is to pay an extra dollar a barrel. Okay, fine. Do that. Um, and we'll see, we'll see, uh, what happens. Trump said, "Oh, I'm not going to allow you to do that. I'm going to put up my, uh, oil, I mean, blockade." Which is really funny since he was the one who said it has to be opened. So, you know, it's, but this is typical of Donald Trump. You know, you never know where, what he'll say from one second to the next. His, his, his thinking isn't exactly clear. So, uh, you have the situation where he's trying to exert maximum pressure in order to figure out how he can say, "I won and walk away." And in order that happened, Iran has to be able to say, "We won and walk away." But there are too many issues on there. As I said, the Israeli nuclear weapons, uh, reparations, how do those get paid? And then guarantees. This is really important. Uh, they, you know, Iran is not interested in the situation which happened before, where they say, "Okay, ceasefire, whatever, then, you know, few weeks, few months, few years, they're back at the door bombing their cities and killing their leaders and things like that." And that, those are all complicated things. The first one depends on Israel giving it up, and that would have to be enormous amounts of pressure put on by the US. Um, the second, in terms of, you know, the guarantees and things, that would have to be by a lot of different countries. Um, the payment of reparations would have to be fixed so that they're not getting, you know, all of this money every year. Um, you know, there's, there's some end to it after they have been made whole, and they go back to charging either very, very little or charging nothing at all, and they free access. So, how do you get this to happen? The only way that I can see this happening is if the world, which is really suffering because of it, comes together. And by the world, I mean the BRICS, I mean South America, Africa, ASEAN, you know, Central Asia, come together and they say, "Enough. You two have to stop." To the US: "Stop with these, uh, nasty tariffs and sanctions and everything like that. Stop trying to pit us against each other for your interests. Stop attacking other countries, right?" And to Iran, they say, "You do not have the right to punish the rest of the world because you desire revenge on somebody who has wronged you." And the only way they can put this worth is not to say, "We're going to attack you or invade you." That just doesn't work in today's world. But they say, "Economically, if you two don't knock it off, we are not going to trade with you." And you're talking about 5% of the world's people, 95% saying, "Nope, you, you know, enough. We're the bigger bully now, and we're telling you that, you know, you, you have to knock it off completely. And if you don't, there will be severe consequences that you cannot control, and they will literally bring your nations to its knees." And that's the only way I can think of that you can get those three issues dealt with in terms of the nukes, guarantees, and the reparation payments. But it's going to be a long process, not something that happens overnight.
I would imagine that there has to be some type of a really strong unity among nations of the Global South to to make a move like that. And I think that would be very challenging because they're all so different.
But they are what they have in common is the impact of US militarism, of US interventionism, um, Israel's actions in the Middle East. All of them are suffering from those things in one way or another. So I think that could be sort of a common ground that unites them in a way that aligns them to seek a solution to this ongoing problem that has been an issue for not decades, but probably centuries.
No, I absolutely. And, um, it would also, the logical place for this to happen would be the UN, but the UN is crippled by the fact that there's five people who are more equal, or five countries that are more equal than all the rest of the countries because they have a veto. The veto has made it dysfunctional. If you can get rid of the veto, which I don't think you can, frankly, no one's willing to give it up by themselves. And, uh, some will just say no, never, I won't do it. So I do think that if these countries come together, it's not under a formal organization. It's simply them coming together and say, "It is time. It is enough. It is enough, children. Uh, you, you, you do not have the right to ruin our lives and the lives of people who have done you no wrong." Right? They, in fact, they might be sympathetic to Iran, as you pointed out, because of what the US has done. Even if they're sympathetic to the US, I don't, it doesn't matter. But the fact is, the damage is being done to their people, their economies. They can come together on this one point. I think there is hope for the world. I think there's, uh, this would be a point of light, uh, and one which might, you know, light, uh, this idea of a global governance initiative that, uh, when necessary, um, the countries of the world come together and do what is necessary for the rest of the world, um, to take care of it. I mean, the reason we have government, governments is to, you know, hold order, to keep us safe. You know, if we live by ourselves, we just fight with the animals and whoever wins wins. We live together. We have to have a structure, and that structure is government. And now governments take on a larger role in terms of, you know, providing opportunities and social safety nets and things like that. But these are all part of what government is supposed to do. But that, that applies not only to individual governments, to, but to all governments. Hopefully, at some point, people will realize this and say, "Look, we need to make the world safer. We don't need more guns. We don't need more ammo. We don't need more, you know, missiles. What we need is a sane approach to figuring out how we can avoid that and stop putting our money into useless items and start putting them into infrastructure, education, social services, right? Helping those who need help." I mean, doesn't that make more sense than trying to kill everybody?
Absolutely. You've mentioned sanctions briefly, and, uh, this past week, the US Treasury has warned that it may impose secondary sanctions on Chinese banks that facilitate Iranian financial flows. And what shocks me the most about this is that, um, the United States has already become its worst enemy. It breaks international law. It wages proxy wars, and it completely disregards the sovereignty of other states, such as in this example. It now wants to go after China for hosting, um, Iranian bank accounts. And so all of this happens just weeks before, uh, Trump and, uh, Xi Jinping are scheduled to meet. So at the same time, of course, Trump really wants to present his relationship with Xi as, as this very nice, very close friendship. So is this a 5D chess, or is this just pure hubris on the part of Washington? Uh, when we see these conflicting messages and, and really, um, actions that sort of this carrot and stick approach being applied?
Okay. Well, if you have any doubts about the answer, whether this is six-dimensional underwater chess played by a master, Donald Trump, uh, just take a look at what he's accomplished over his, you know, first term and then now over his year and a, a midterm. Nothing. Where's his health plan? Where, where are the lower prices? Where, how did he keep America out of wars? How is he re-industrializing America? All right. How, how has, you know, has he brought truth and light to the Epstein files? This is my point. What he does, he specializes in waking up every day and thinking, "Hm, how do I keep everybody occupied? How do I keep the press chasing?" You know, you know, if you go into a room and you put a dead cat on the table, everyone looks at the dead cat, right? If you go into the room, you throw a dead cat on the table and then you release a bunch of white bunnies into the room. What happens? Look at the dead cat, then they look at the bunnies, and as a result, they forget the questions that they're going to ask you about, you know, your policies and whether they're working. Instead, they ask you about Melania's film, or, uh, you know, your latest outrageous statements. You know, you get to reply, "Well, I don't like them. You know, he's not important. He's low IQ," or she, she, I, she, I, I, I know I pointed all these people to cabinet positions, but they're no good.
>> Right? >> I mean, this, this is the apprentice. All right. Washington edition, sixth, uh, sixth season. And, you know, you can already see that he's, he's called people to the boardroom and fired them. And, you know, he's, he's just doing all the things he did in his television show, which is distract people, people occupied in the moment, not thinking about what is, what is this crazy guy doing with with all these pe young people pitting them against each other, right? That's what he was doing. So, he's, he's just following what he knows. Um, and there's no, you know, there's no real plan. If there was a real plan, he would have accomplished something by now. And he hasn't. Oh, yes. I shouldn't say that. He has frightened and deported and killed people because he says they're foreigners. Kind of interesting in a nation that is founded by foreigners who took the land from the indigenous people. Uh, he somehow separates the line, uh, not based like his wife on when she came, or the fact she was quote a genius, which I think most people would say, uh, isn't the case. Um, know he just does it because of the color. He's, he's gone after Somalians. He doesn't, I doubt he even knows any Somalians. All right. He says that they created credit card, um, no, Medicare and Medicaid fraud.
>> Hundreds of millions. Well, he pardoned about 30 people, uh, who were engaged in, among other things, Medicare, Medicaid fraud, and they don't have to pay back about 1.1 billion in fines because he pardoned them. These are convicted criminals. They, there's no question of their guilt, but because they knew somebody or paid somebody, he was, they were, they were given pardons. And this has been documented. Then you get into his incredible amount of of personal interest in this. His family is getting wealthier by the minute. His, um, value of his, you know, his wealth has gone up to five billion dollars. And, uh, there's rumors that his son is, uh, trading on inside information, uh, ahead of the announcements that he's making and, you know, clearly things. But is the, is the watchdog actually pursuing it? Apparently not. Why? Because they're controlled by Trump. So, you know, we have a situation which is out of control. He has no idea what he, he's doing. He reacts on a day-to-day basis. Uh, it's what he's always done. He's using the model of his show and, um, unfortunately, the Republican party is going along. But one thing I think people should pay close attention to, and that is most of the pundits who have turned, who used to be pro-Trump, prog, are still kind of pro-MAGA, but they're not pro-Trump anymore.
>> And they're talking a lot about JD Vance, the vice president. So why would you talk about that? Because if the party and, um, powers that be decide that Donald Trump has shown he is incompetent, or he's losing his marbles, or whatever, they can use the 25th Amendment to remove him. All it takes is the majority of the cabinet saying that, you know, "We believe the president is incapacitated and unfit to serve." Uh, he served with that. He has a limited time to respond, but in essence, the cabinet rules, and he can be removed. Uh, that would put JD Vance, uh, in the White House. Uh, a frightening thought. I call JD Vance "Darth Vance" because he, he believes and is associated with those who believe in dark enlightenment. Dark enlightenment is this belief that the government, uh, should be bankrupted and its functions taken over by the private sector. Uh, people like Peter Thiel, um, who, it's the largest shareholder in the country, I mean, a company that was named after the evil eye, it's Palantir, the evil eye of Sauron in, you know, the trilogy of, uh, the Lord, the Lord of the Rings. I mean, I, I, I'm speechless. I mean, you have nerds playing out fantasies where they're, they're going to be the tech lords of the world controlling it because they're so smart.
>> Right? >> Yep. >> Fortunately, we've seen in history the same thing happened with the railway, oil, and steel barons back in the, uh, 1880s and the, you know, boom boom times of American industrialization. Um, they all thought that they, um, you know, they should be taking over, but what did they do? Who, in the end, they just fought each other because they hated each other so much and they were so competitive. So I don't think it works. Um, but, you know, here, here's, here's a guy who, you know, it's estimated that Peter Thiel put $250 million behind, um, he believes, you know, fellow traveler with this dark enlightenment, uh, that he's thoroughly anti-democratic. They don't believe in democracy. So it doesn't work. See, doesn't work. We should take over. But they're up against, of course, the traditional military-industrial complex, which says, you know, "Oh, you know, don't go with the drones, don't go with the missiles, don't go with the cyber technology, go with tanks, submarines, you know, big iron, you know, we, we need, we need more navy, we need more aircraft carriers," even though they don't always work very well. Uh, so they're fighting. And then on the Democrats seem to be concerned with protecting the corporations who want to go back to the good old days when the US government was their, uh, in essence, their proxy. They would go in and wipe out countries or governments that didn't agree with them. I mean, that's where Banana Republic came from. Um, they literally, the Dole would say, "Oh, they're trying to organize a union," or "There was a democratic election. We don't like this guy. Come on down." The military would go down and organize a coup and, you know, install the dictator, and of course, the terms for the, uh, for Dole and the rest of these corporate interests were very good. So that, ironically, the Democratic party has switched from the workers to their bosses, uh, representing these special interests that want to hold sway over the world so that they can basically milk it for everything that they can possibly get.
Well, what's missing here? People of America. >> Uh, the people who for the last four years have had their salaries going sideways. Uh, 1972, uh, you know, 6, uh, 1% of America is middle class. You use the same metrics and you go forward to 2024 and it's only 40%. You, you know, you lost a lot of people. And yes, there were increases in the upper middle classes, but not enough to offset it. And those people in America, 60% of them don't have $400 in case of an emergency. They're living basically paycheck to paycheck. That means they're fragile. Uh, if they have to take an ambulance, it's going to cost a lot more than $400. Uh, if somebody dies and they have to pay for a funeral, it's more than $400. Uh, most likely, if they, if their car breaks down, they need new wheels, whatever, going to be more than $400. They don't even have $400. So the, these are people living on the edge. Um, and no one seems concerned about it. There's a lot of lip service paid. That's these are the people who's voted for Donald Trump because he said he was going to control prices. He was going to bring back good industrial jobs. Who's going to make sure that their, you know, their sons and daughters didn't have to go to wars, and now they've been betrayed. So, you're starting to see this pantomime play out. Um, I would, I would imagine, uh, before the midterms, that there might be a move to remove Donald Trump, uh, because the Republicans are looking at the polling, and it's dismal. If the polling follows, um, the popularity of Donald Trump, you will see a massive change in, uh, the Senate and in the House. Either one, if it's controlled by, uh, the Democrats, will mean that Donald Trump's, uh, ability to maneuver, uh, will be pretty much at an end.
>> Absolutely. And it's very interesting that we're just several months away from the midterms, and Trump's rating is at an all-time low. It's, it's underwater, and there's really no visible, um, visible desire on Washington's part to reverse some of its policies, to really sort of, um, you know, at least attempt to remediate some of these issues. It seems that we're, they're just digging deeper and deeper, and, um, it, it, it's unclear what the, what the goal is, but, uh, the midterms will be really interesting if they happen. If, if, if you know, >> Agree, if they happen. >> If they happen, because that's a big if at the moment. And it does seem that Trump is willing to use anything, any reason that he could spin to portray it as his victory. And it does seem to me that going to Beijing, meeting Xi Jinping will be used by the Trump administration as a win somehow. So maybe, um, Anar, the last question for you today, with the US-Chinese summit coming up, what are Trump's goals versus what are Beijing's goals? What are your expectations?
Well, um, Trump's goals are, you know, to distract attention from Epstein, from a war he's losing, from his economic policies, which aren't working out, from a splintering of his MAGA base and his rotten polling numbers and things like that. He really believes that when he's standing next to a powerful other leader, or there's Putin or Modi or or Xi Jinping, that, you know, uh, it gives him a halo, that he's now one of the boys. Okay? And I'm a big powerful guy, and I'm going to have a huge triumphal arch, a huge ballroom, and I'm going to put my face on Mount Rushmore, and I'm going to win the Nobel Prize, and things like this. A man and who's who's always trying to compensate for, let us say, his lack of many things. Um, so, yeah, I mean, his, his goal here is, as I said, to distract. He'd like to get something, but he, what, now let's go to the other side. What will China be offering, and why will, if they have this meeting, why will they do it? Um, there's a lot of of debate right now as to whether I think, uh, they would, there was an understanding, um, or at least a whispered understanding that, uh, one of the, um, requisites, uh, was peace in Lebanon, that there be a, not peace, a ceasefire. So he declared a ceasefire. Israel is violating it. They're just continuing to attack it. They don't really care, apparently. Um, but it makes, look, Trump look really, really weak because he forbade them. All right. And they are just, you know, basically blowing raspberries at him while they kill more Lebanese people. So China's concerned that he's painted himself into a corner, and they're concerned that he might do something desperate. Remember, the US has 5,000 nuclear weapons. Whether he would try to go with a tactical nuke or something like that. Once again, you know, no one knows what it would mean. It would, um, it would certainly have repercussions worldwide. Uh, Iran, in particular, sits at the Euro, uh, Asian, um, slipstream. That means, uh, anything that goes up there, the nuclear cloud will be spread all, all over the place, very, very, very quickly, and, uh, it would have repercussions for India and other parts of the Middle East, etc. Uh, so it would be very, very, uh, consequential. If they light off enough of these, you could have, uh, kind of a nuclear winter coming on. Obviously, there would be, um, death and destruction as it, uh, the radiation affected food stocks and people's lives, water, etc. So in that kind of situation, uh, if they feel they can, uh, basically, you know, talk with him, to sit down and engage with him, offer him a few bubbles, say, you know, "We'll buy some more corn or soybeans if you do this." Uh, all transactional, because that's all you can do with Donald Trump. You give him something today, he's back tomorrow saying, "I don't care about that. What are you going to do for me today?" Uh, and you've seen any show of weakness by any country, it results in absolute, you know, disdain. I mean, just treated like a dog. Uh, Trump being a bully, um, doesn't respect anybody who, you know, gives into him, which is kind of weird why Mark insists on calling him "Daddy."
>> Right? >> Which is some unbelievable. I mean, it's, it's, it's like Stockholm syndrome. You, you feel like, "Oh, you know, it's, you know, Mark, we need, we need to get you to a safe place. You're, you're, you're in danger." Um, but I mean, so, I mean, it's for China, it's tough. They have to be the adult in the room, and they don't have a choice because, you know, as I said earlier, they have a lot of stake here, uh, in terms of the global economy. And the idea is that you have to outlast Donald Trump, um, prevent him from doing something so crazy and, um, you know, detrimental that it, it ruins the world. And, but China can't do it by itself. Um, they are actively engaged in and talking to other countries about coming together, um, uh, getting middle powers who can sit at the table with these two, Iran and the US, and convince them that it's time, for the sake of the entire world, including their own economies, um, to figure out a way in which they can coexist, if not coexist, they can, you know, just leave each other alone, uh, otherwise everybody suffers. Nobody wins.
>> Ian, really appreciate your insights. It's always great to get your thoughts and expertise, and I would encourage our viewers to follow you on Substack. I will link your social platforms in the video description below. Thank you so much for joining, and I look forward to a new one with you.
>> Well, thank you, Lena. I just have one thing to add, if I may. You asked why, why are these parties sitting on their hands, seemingly doing nothing? And I would say to this to you that in party politics today, it's not about showing leadership. It's about showing loyalty. In order to rise from one level to the next level, you have to go along with party platform. If you're always agreeing with party platform, you're not really a leader. You're just a yes man. And what we have on, on both sides of the aisle today are people incapable of doing anything other than saying yes. Why? Because they're, they're the products of a system which rewards those who do.
>> Absolutely. This is so important because what we have is a uni-party, effectively, in the, in the United States. It's, it, you know, when the Democrats used to be pro-peace decades ago, or at least that's what you know, the official story was, um, and the Republicans were pro-war. When, well, now we have both parties that are pro-abuse of human rights, pro-war, arguably genocide, proxy wars, and, and, and, you know, pro-war in general, and, and, and really don't put America first as they should, because their constituents would certainly love them to. Um, but, but as you mentioned, yes, I think that that's a very, very important point, and I love that that's this is the point that concludes the discussion because hopefully that would be one of the key takeaways from today's episode.
>> Thank you.