Global Entropy: Enter the dragons

Geopolitical disorder emerges as the greatest economic threat

In late 2019, my high conviction in US outperformance, held since 2014, began to erode as I perceived increasing risk of high-impact, unpredictable events.  By February 2020, adding a strange, emergent respiratory disease from China to my list, I wrote:

“The world is awash with difficult-to-quantify risks associated with tectonic shifts in politics within and between countries, climate change and new technologies, and their impact on value chains, economic relationships, and disease management in an era of hyperglobalisation.”¹

That statement may be truer today than it was just before Covid upended the world.  Conditional on there being no large-magnitude, “exogenous” disruptions (pandemics, wars, comets…), I remain confident of Localization-driven US outperformance, higher-for-longer interest rates, underperformance of and significant macro-credit risks in both Europe and emerging markets, and long-run persistence of “China’s Age of Malaise.”

But the key word is conditional.  The world stands on the precipice of a calamity with the potential to be far more disruptive, costly and more deadly than Covid.  Global entropy – the two-decade old dissolution of the post-World War II liberal order (PWLO) – threatens to tip into a Complexity cascade that brings down the entire edifice with frightening speed and potentially catastrophic effects.  Whether the world stumbles over the precipice into a Complexity cascade and what events will unfold as a result, define Uncertainty: non-quantifiable risk.  Yet, the implications are so profound – not just for asset markets – and the signals of its rising likelihood so clear, that it now is impossible to ignore in portfolio management and strategic decision making.

In this free article, I define and provide a framework for understanding the forces driving Global entropy, I explain why we now are at risk of nonlinear acceleration, and sketch out what the geopolitical endgame may look like. In future articles I will l explain (1) why the most likely outcome of Global entropy is a semi-fluid, bipolar world order of “Global bifurcation” in trade, technology and finance; (2) why Global bifurcation likely will lead to the emergence of independent blockchain-based payments systems; and (3) how to hedge the not-insubstantial risk that Global entropy instead tips into a Complexity cascade of global disorder.

Key insights

• Global entropy, the two-decade old dissolution of the post-World War II liberal order (PWLO), has advanced far enough that it now faces a dangerous tipping point of potential disorderly acceleration towards a chaotic endgame.

• The base case for Global entropy is evolution to Global bifurcation, a bipolar order with multiple regional powers playing the Western bipole against the Sino-Russian bipole.

• Global bifurcation will result from increasing technological dominance by the Anglosphere and China and the strategic competition between them that will lead to a bifurcated system of information and export controls that reinforce bifurcation.

• The “great games” of international relations will be competition for mineral resources and to capture other states within their bifurcated technology networks.

• But there exists a significant but non-quantifiable potential for Global entropy to slip into a Complexity cascade of chaotic Uncertainty with a more fragmented and fragile global order resulting.

• Cultural differences will play an outsized role in the path Global entropy takes. Since the 1990s, Western diplomacy has become increasingly moralistic and simultaneously blind to the chasm between its own values and most of the rest of the world. China and Russia are challenging its global leadership and the PWLO by exploiting that chasm to propose a world order based on sovereign rights, making cultural values and rights for sovereign self-determination the battleground for a new world order.

• With Western political, economic and military ascendency past their respective peaks, cultural divisions are more visibly being used as weapons to fracture the PWLO.

• The risks of catastrophic failure of the PWLO and a Complexity cascade hinge on the ability of adversaries of the PWLO to exploit differences in cultural values and overwhelm the US and its allies with geopolitical firefighting.

Disorder & nonlinearity as natural states

Entropy is a concept from physics that any system, left alone will tend towards disorder.  Complex structures like human organizations are no different.  By Global entropy, a major Theme in the global political economy, I am referring to the natural dissolution of the “rules-based,” post-War liberal order (PWLO) established by the US and its Western allies at the end of World War II.  The PWLO has steadily eroded over the last three decades due to a series of Western missteps combined with the natural tendency of challengers to arise within a complex system like the global political economy.

Complex systems, like nation states and international orders, are nonlinear and can rise or fall with surprising timing and rapidity.  Global entropy is now well advanced, and in my view, the PWLO stands at a precipice where a wrong step could result in rapid, complete dissolution.  To understand how and why this could occur, and what might result from nonlinear demise, I begin with a framework for international relations and a history Global entropy since the PWLO’s peak.

The glue of international relations

Socio-political entities like nation states, supra-national entities, and international orders are held together by three forms of glue: power (threat of force), wealth (allocation of scare resources) and myth (culture, religion, ethnic or linguistic ties).²  The most durable socio-political entities are built on all three.  But larger, multi-group socio-political entities face a problem since myths tend to be grounded in a shared history, language, religion or culture.  In these cases, myths can obstruct cohesion as well as bind.  As a result, multi-ethnic empires and, especially, international orders have typically relied more on power and wealth, making them less durable than nation-states (or tribes) that can rely on all three socio-political adhesives.

A central pillar to my thesis is that an important contributor to Global entropy and its future pace is a mistaken belief by the West that its own socio-political myths are internationally shared. As a result, the West over relies on myth to maintain the PWLO and, worse, is blind to others’ antipathy towards it, particularly, the West’s conception of “universal human rights.” The gap between the West’s perceptions and reality provides and opening for its adversaries to exploit in tearing down the PWLO.

Global entropy, the story thus far

The US-led PWLO is exceptional in history and was enabled by unique circumstances: a world war that left the US head and shoulders above all global challengers.  In its aftermath, the US was by far the largest economy, the most powerful military, master of the seas, and its universities and research laboratories were the primary source of innovation in the world (see Solved: Drivers of the dollar cycle).  No other nation or empire in human history was so globally dominant.  For four decades, the Soviet Union’s nuclear capabilities created a bipolar international order, but economically and culturally the US was without equal.  Within that context, the US was able to impose and sustain a world order of its own design.  Access to US markets, for those that participated, was the key to rapid income growth as pioneered by Japan and Germany, and later copied by Asia’s “Tigers”, while the US Navy kept the seas free for commerce, and the US military and alliance network policed any would-be disruptors of Pax Americana.

Apex neoliberalism: the beginning of the end

Yet arrogance and time, the greatest enemy of order (and friend of entropy), would eventually bring about change.  Time allows for supplicants to learn, grow and eventually challenge the master.  Indeed, this was intrinsic to the design of the PWLO: the US Marshall Plan, US AID, and post-War international institutions like the World Bank and International Monetary Fund (IMF) were created to facilitate the growth and rebirth of destroyed and developing nations, while the United Nations (UN), World Trade Organization (WTO), and International Criminal Court were created to channel would-be challengers through an institutional bureaucracy and systems of rules to avoid more costly state-to-state conflicts.  However, as a result, the entire system increasingly came to rely on its own creation myth: that the rules underlying the new international governance structures and bureaucracy were “universal values” accepted by all.

While US power and wealth remained pre-eminent, the PWLO myth could be supported. But the rise of Apex neoliberalism that was blind to the limits of myth in a multicultural world and arrogantly assumed Western power and wealth was unassailable sowed the seeds of the PWLO’s demise. The three pillars of Western power – the PWLO myth, economic dominance, and military superiority – peaked in relative terms over little more than a decade from 1991 to 2003.

Peak myth

Western international prestige peaked in 1991 with the coincident fall of its only geopolitical rival, the Soviet Union, and the Gulf War’s expulsion of Iraq from Kuwait by a US-led coalition of 42 nations sanctioned by the UN and even the Arab League.  Seemingly democracy had triumphed, recidivist powers were in decline, the “rules-based order” dictated international relations, “universal human rights” were accepted by all, and “The End of History” was declared.³  The reality, as time would prove, was quite different: some countries superficially adopted Western liberalism to access the rich US and European markets; others, like the former East Bloc, as noted by Branko Milanvic, did so as “revolutions of national emancipation” from centuries of rule by the Austrians, Germans, Turks, and Russians;⁴ while still others did so out of fear of the West’s awesome display of power in the Gulf War.

Yet, at least one country took a very different lesson from the triumph of the US-painted world order: an imperative of rapid modernization in order to resist the Western order or even overthrow it, and the usefulness of PWLO institutions for a poor country to do so.  The Chinese Communist Party (CCP), having just two years earlier brutally crushed a liberal movement that threatened its rule, looked with horror at the ease with which the American military turned an army that looked very much like its own into smoldering rubble along the “Highway of Death” in just 10 hours.  Chinese fears were fanned over the next two decades by increasingly values-driven Western international activism under the aegis of the PWLO, that also resulted in the humiliating accidental bombing of China’s Belgrade embassy in 1999 during the UN-endorsed NATO bombing campaign of Serbia.

While China was plotting a new course, Apex neoliberalism, giddy with its own success, sowed the seeds of its demise over the course of the quarter century following the Gulf War. The West deeply bought into its own myth, blind to the reality that others had not, and stretched towards imperial overreach.  President Clinton’s Secretary of State, Madeleine Albright epitomized the hubris of Apex neoliberalism when she justified US international activism by stating “If we have to use force, it is because we are America. We are the indispensable nation. We stand tall. We see further into the future.”⁵

Under Apex neoliberalism, Western statecraft shifted in focus from national security to moralistic, evangelical interventionism to uphold the Western vision of morality.⁶  The “War on Terror” further confused international relations and Western power projection.  For nearly a quarter of a century, under three separate administrations, the US led narrowing coalitions backed by increasingly tenuous PWLO legality on expeditions of regime change in Serbia, Afghanistan, Iraq, Libya, and Syria, and conducted drone or Special Operations Force (SOF) assassinations and other extra-sovereign missions in a variety of other countries.⁷

Overuse and inconsistent application of a morality many other countries did not share, applied with frightening lethality by the West’s expensive, hi-tech militaries, scared, appalled and disillusioned non-aligned countries and even many allies.⁸  The myth holding together the PWLO was demolished by meaningless “red lines,” flip-flopping between allies and adversaries with each change in presidential administration (2000, 2008, 2016), and a long line of body bags and failed or weak states, culminating in the disastrous and humiliating US withdrawal under fire from Kabul after America’s longest war. That is, for everyone but the West.

Peak economy

Western economic power peaked with China’s accession to the WTO on 11 December 2001: the shot not heard around the world.  Weaponizing the Asian development model pioneered by Japan, China industrialized and climbed the economic-value chain with unprecedented speed and scale through consumption repression and directed investment (Mercantilism (with Chinese characteristics)), and reorientation of global supply chains through uncoordinated group exchange rate repression (Chinese co-prosperity sphere) that leveraged the monstrous appetite of the US consumer.  In the process, China became the literal factory floor for not only the US, but the world.  China is now the second largest economy in the world, its largest official creditor, and the largest trading partner to more than 120 countries.⁹

This was no accident nor merely the most successful development strategy in history.  With 20-20 hindsight, it appears part of a broader grand strategy to challenge the US and overturn the PWLO.  By becoming the world’s factory, China’s industrial policies made both allies and adversaries alike critically dependent on it for nearly all manufactured goods, from essential medical supplies to advanced materials and technologies.  The latter reflected not only extensive industrial policies but detailed, methodically designed outward-investment¹⁰ and espionage policies¹¹ that catapulted China to the cutting edge of industrial and military technologies.  China’s near monopoly production of the rare earths essential for many advanced technologies (and guided munitions) and Huawei’s leadership in 5G networking are well known, but the list of critical technologies in which China now leads or dominates — 53 of 64 in one study¹² — is both staggering and reflective of at least two decades of carefully planned and executed long-term state strategy.

China’s economic and industrial policies, its Belt and Road Initiative (BRI) and widespread information warfare,¹³ appear to follow the arc of grand strategy sketched by two senior colonels in the People’s Liberation Army (PLA) in 1999.  In their book “Unrestricted Warfare,” Major General (ret.) Qiao Liang and Colonel (ret.) Wang Xiangsui advocated, as the title suggests, an unrestricted definition of warfare that extends beyond military conflict to all domains. They specifically enumerate economics, politics, international law, and information as domains of warfare.¹⁴  Although the influence, feasibility and even originality of the book’s strategy are debated¹⁵ — some argue the book merely restates Mao Zedong¹⁶ — it is hard to deny that China’s policies of the last quarter century don’t well fit the book’s recommendations.

A 2015 speech on economic and financial policy by General Qiao, with specific examples, supports that idea that Chinese economic policies were at least partly designed with inter-state conflict in mind.  A year before the Chinese renminbi achieved international recognition as a reserve currency with inclusion in the IMF’s special drawing rights (SDR) basket, General Qiao spoke before the CCP’s Central Committee, focusing his speech on economic warfare that (1) explicitly identified the BRI as an economic weapon, (2) described (his perceived) use by the US of the dollar as an economic weapon; and (3) made a case for China to pursue a reserve currency as both a countermeasure and offensive weapon.¹⁷

Peak military

With growing economic might focused on the broadest definition of warfare, challenging US military dominance was only a matter of time.  That job was made easier by Apex neoliberalism’s arrogance and misdirected focus on international activism and the “War on Terror.”  David Kilcullen dates the high-water mark of US military power precisely to 5:30am Bagdad time on 19 March 2003 when US Special Operations Forces failed to decapitate the Iraqi regime in the opening salvo of Iraq War.¹⁸  From that point onward, dispersed, non-state actors, “snakes” in Dr. Kilcullen’s parlance, evolved low-tech, asymmetric countermeasures to avoid direct confrontation with the unmatched lethality of America’s expensive, hi-tech, communication-enabled, precision-guided weapons that were designed to fight “dragons,” i.e. strategic rival nation states with professional militaries.

But the dragons were watching and learning, and as Dr. Kilcullen notes, Apex neoliberalism blinded the West to the growing danger: “Western powers have acted as if they were still in a…security environment [characterized by] threats originated from weak [or] failing states and nonstate actors…[when they instead faced] a return of state-based threats and great-power military competition.”  While the US was preoccupied with its War on Terror, nation building and the global financial crisis, the dragons were testing their own asymmetric strategies and advanced weapons: “liminal” or hybrid warfare just below the threshold for counter attack or with plausible deniability (e.g. poisoning dissidents in foreign nations, “little green men,” unmanned vehicles, and balloons);¹⁹ hypersonic missiles,²⁰ fifth-generation stealth fighter jets,²¹ swarming autonomous vehicles (used to attack the world’s largest oil terminal),²² and loitering munitions (demonstrated with deadly effect first in Nagorno-Karabakh and lately in Ukraine).²³

The dragons emerge to stretch

By the end of the noughties, the dragons began to emerge from their lairs to stretch and test their new strategies and weapons.  Russia had developed its own — similarly disputed and misunderstood — version of “Unrestricted Warfare,” the “Gerasimov Doctrine.”²⁴  To prevent NATO enlargement to Georgia and borrowing a justification of Western international activists, Russia invaded and occupied two breakaway provinces to “prevent genocide” in 2008.²⁵  Six years later, unflagged “little green men” seized Crimea from Ukraine and held a referendum to join Russia.²⁶  Next, Russia armed and supported separatist insurgencies in two eastern provinces of Ukraine.  Then in 2016, albeit almost certainly by accident, Russian information operations hit the mother lode with $100,000 in Facebook ads that had no discernible effect on the US election but wholly absorbed and crippled American politics for the next four years while hobbling the presidency.²⁷

China also tested its borders in ways that flew just under the threshold for action.  It started in space in 2007, blasting an unused satellite into thousands of shards with an anti-satellite missile.²⁸  Then in 2013, it began to construct whole islands and fully militarize them from tidal rocks and shoals in the South China Sea, a vast and crucial waterway it claimed as sovereign waters.²⁹

The dragons also began to challenge both the PWLO myth and Western leadership.  In 2013, the Obama administration opened the door by inviting Russia to help enforce its “red line” regarding chemical weapons use in Syria’s civil war.  After the US then failed to act on violation of its own red line, in 2015, Russia directly intervened to support the Assad regime that Western powers sought to depose.³⁰  The Syrian saga simultaneously boosted Russian prestige as an alternative to the PWLO while catastrophically undermining US and Western credibility.³¹

China instead offered carrots, but through its own alternative institutions rather than those of the PWLO.  Its first salvo was to launch a competitor to the Washington-based, Bretton Woods-era Asian Development Bank with the establishment of the Beijing-based Asian Infrastructure Investment Bank.³²  Even before founding the AIIB, China engaged in a massive bilateral official lending program that has made it the world’s largest official lender (that has put it in conflict with the Paris Club of other official lenders in debt restructurings in Ghana and Sri Lanka).  But the official numbers hide much of China’s direct aid and lending: one accounting reveals $841 billion of lending and aid associated with more than 13,000 projects in 145 countries since 2000.³³

With greater ambition, China launched the BRI in 2013.  The BRI was structured as a development aid and trade promotion initiative that encouraged integration with China and as an explicit alternative to Western mechanisms like the IMF and World Bank.  The BRI simultaneously attempted to supplant the PWLO with China’s own soft power while creating an economic and physical infrastructure that enhanced China’s economic and military power through trade links, communications and payments networks, deep-water naval ports and land-based transit of critical minerals.³⁴

The US finally noticed the newly flexing dragons with the election of Donald Trump in 2016.  No friend of the PWLO himself, President Trump arguably helped further undermine it by unsettling allies and displaying open hostility to its institutions.  But his administration’s foreign policy made a clean break from moralistic global policing and shifted to a realist policy of “offshore balancing” (even if never formally articulated or perhaps even understood as such by President Trump).³⁵  The shift to offshore balancing implicitly recognized the need to preserve US strength for conflict with strategic rivals by avoiding direct engagement “onshore” in less-vital conflicts and instead using local proxies (e.g. the Kurds and Israelis in Syria)³⁶ with “off-shore” gunboat diplomacy (e.g. the drone assassination of Iranian Quds Force leader Suleimani).³⁷  But more enduringly — though it took until the election of Joe Biden for the US establishment to grudgingly accept it — President Trump shifted perceptions of China to an irreducible strategic rival of the US.

But by then, it was too late: the myth of the US-led PWLO had been shattered, US military and economic power were no longer viewed as invincible, and Global entropy was visible everywhere.  The dragons began to roar.

The end of the beginning: the dragons roar

By the start of the Biden administration, China already had completed a multi-nodal platform for anti-access/area denial that is thought to be fully effective through the “first island chain” of the Western Pacific.³⁸  The centerpiece of its capabilities are overwhelming land-based intermediate-range, ballistic missiles (IRBMs), many capable of precision targeting, hypersonic maneuverability and carrying either conventional or nuclear payloads.  The most advanced of these, the DF-17, has the range to strike through the second island chain.³⁹  Within the first island chain China has built a fleet of “unsinkable aircraft carrier” man-made islands to complement the world’s largest navy (by number of ships); the largest merchant marine and “fishing” fleets, has newly acquired or is developing deep-water ports extending around the Indian Ocean to Djibouti on the Arabian Sea, and is in negotiations with Equatorial Guinea for an Atlantic Ocean base.⁴⁰

Increasingly confident that it now could deter US naval power, and likely emboldened by the disastrous US withdrawal from Afghanistan, Chinese rhetoric has become far more bellicose and coupled with equally aggressive actions.  President Xi dropped any pretense of Deng Xiaoping’s “hide your strength and bide your time” policy.  As early as the 2017 Communist Party Congress, President Xi declared a “new era” in which China should take “center stage in the world to make a greater contribution to human kind.”⁴¹  More recently, President Xi was even more explicit on what this meant, telling Chinese soldiers to prepare for war as “the East is rising and the West is declining.”⁴²  While the carrots of official lending and BRI remain on offer, the dragons claws now are more clearly bared in “wolf-warrior” diplomacy, especially for those perceived to violate its “One China” policy.  China severed “circuit-breaker” high-level military dialogue with the US in punishment for House Speaker Nancy Pelosi’s visit to Taiwan, and has not reinitiated them despite US requests, in part to keep the US off balance.⁴³

In keeping with the sharpening of its rhetoric, Chinese territorial expansion also has become more aggressive.  In addition to daily incursions into Taiwanese airspace and territorial waters by the Chinese military, China also has staged multiple large-scale naval exercises just off Taiwan, including joint exercises with the Russian navy.⁴⁴  In the South China Sea, harassment of non-Chinese vessels by Chinese “fishing boats” has more recently escalated to ramming by Chinese coast guard ships.⁴⁵  But perhaps most aggressively, while the world was preoccupied with Covid, Chinese troops pushed forward the line of control in the Galwan Valley, in a disputed area of the Himalayas, killing 20 Indian troops in the process.⁴⁶

The Russian roar was heard even louder.  Dispensing with deniable attacks by unflagged little green men and ethnic Russian separatists, Russia launched a full-scale (and fully flagged) invasion of Ukraine in 2022 that continues as a war of attrition and proxy war with the West that continues today.

On the precipice: Culture & Complexity

The dragons have fully emerged and shown there is little that American firepower, economic sanctions or moral suasion can do to contain them.  Global entropy is well underway and the only questions remaining are how rapidly or disruptively the final vestiges of the PWLO collapse, and what emerges in its place.

Somewhat paradoxically, I submit that the answers to these questions hinge on socio-political myths, or culture.  Both power and wealth — the strongest socio-political adhesives at the international relations level — are undergoing technological revolutions that will leave them in flux perhaps for decades.  Localization is upending the global economic order, while the rapid evolution of military capabilities and strategies are doing the same for state power projection.  The key driver of both is technology.  But cultural evolution is far slower. As I noted earlier, socio-political myths are as likely to be to be obstacles to cohesion as adhesives.  How both the West and the dragons exploit cultural commonalities and fissures between nations and peoples will play a crucial role in determining both the final days of the PWLO and the shape of its successor.

The new wars of religion & the blind evangelists

Consider the myths of international order embedded in recent speeches by the presidents of the world’s three leading powers (with my emphasis added):

“We should foster a new type of international relations featuring win-win cooperation; and we should forge partnerships of dialogue with no confrontation and of friendship rather than alliance. All countries should respect each other's sovereignty, dignity and territorial integrity, each other's development paths and social systems, and each other's core interests and major concerns.”

— President Xi Jinping, Opening Address to the 1st Belt and Road Forum⁴⁷

“[The Belt and Road Initiative is] a truly important and global idea that is spearheaded into the future, towards creating a fairer multipolar world and system of relations. Russia and China…share the striving for equal and mutually beneficial cooperation towards universal, sustainable and lasting economic progress and social welfare based on respect for the civilisational diversity and the right of every state to its own development model.”

— President Vladimir Putin, Keynote Address to the 3rd Belt and Road Forum⁴⁸

“America is back.  Diplomacy is back at the center of our foreign policy…global challenges — from the pandemic to the climate crisis to nuclear proliferation — …will only to be solved by nations working together and in common.  We can’t do it alone…we must start with diplomacy rooted in America’s most cherished democratic values: defending freedom, championing opportunity, upholding universal rights, respecting the rule of law, and treating every person with dignity.  That’s the grounding wire of our global policy — our global power.  That’s our inexhaustible source of strength.  That’s America’s abiding advantage.”

— President Joseph R. Biden, on “America’s Place in the World,” 2021⁴⁹

All three visions for global order appeal to cooperation to solve common global problems for the benefit of all.  But Presidents Xi and Putin both call for a “new” global order in which the words “equal,” “universal,” “diversity,” and “dignity” are explicitly reserved for sovereign states.  Nowhere in either of their speeches can one find the word “value” and only Mr. Putin, once, as quoted and referring to states, mentions “rights.”  In contrast, the focus of Joe Biden’s first foreign policy speech as president was a return to the old order: “America is back.” The vision he expresses for international relations is entirely grounded in “values” and the “rights” and “dignity” of individuals, not states.  Even the common global problems they want to solve are different: Messrs. Xi and Putin enumerate economic progress, social welfare and territorial integrity (without irony), while Mr. Biden focuses on climate and nuclear proliferation.⁵⁰

The difference is quite stark, even if subtle, and defines the battle lines for the next phase of Global entropy.  The dragons explicitly recognize that socio-political myths, or culture, define nations and are not necessarily common across them, hence, can be obstacles to international relations.  Consequently, Messrs. Xi and Putin focus their diplomacy on those state-to-state interests that truly are universal — state security and economic welfare — where they have an advantageous position on a hill above the cultural battle ground.

British historian Tom Holland contends that Western secularism — its scientific progressivism, rights-of-man enlightenment and broader values — not only reflects but is a god-less extension of the European Christian culture from which it arose.⁵¹  Mr. Holland goes even further by defining a culture war as a battle of “sublimated theology” regarding “the limits of religious authority over a secularizing state” in which “one side doesn’t recognize [it is a theological debate] and the [other] side does.”⁵²  Using Mr. Holland’s definition, the dragons have launched a culture war over the limits of a secular international order over religious states, or states whose cultural values may conflict with either Western secularism and its Christian roots and the West is the side that remains unaware that it is engaged in a theological debate.

Seen in that context, President Biden’s vision as stated above — in words that eerily echo those of the late Madeleine Albright quoted earlier — describes American diplomacy in almost evangelical terms.  Worse still, he appears blind to the terrain on which the dragons have pitched for battle: the real choice other countries face is not between the economic might or military power of each side, but over the national sovereignty of their own cultural values.  Presidents Xi and Putin make clear that nations choosing BRI can keep their own socio-political myths. But even as Global entropy erodes its cachet, the leader of the West is pushing for hike in PWLO membership dues: full adoption of Western values.

President Biden is not an outlier among either American or Western leaders.  Not to be outdone by Americans in evangelism, the EU describes its own policies on human rights thusly (my emphasis added): “The European Union's policy is based on internationally agreed frameworks and standards, reflecting the belief that human rights and democracy are not ‘Western’ values but universal values to which all UN members subscribe.”⁵³  This rhetoric is common across Western nations and is tied to a lengthening list of “universal human rights” that are enforced through official aid and lending.⁵⁴  Indeed, the Lisbon Treaty enshrined in the EU constitution a legal requirement for human rights promotion in all external EU activity.⁵⁵  Even the World Bank despite noting that “[u]nlike other agencies which have explicit human rights mandates, our role within the United Nations system does not assign to us a human rights mandate,”⁵⁶ suspended loans to Uganda over its anti-homosexuality law as it “contradicts the World Bank Group’s values.”⁵⁷

The problem for the West — and global stability as it stands on a precipice — is that non-Western peoples, contrary to the EU’s belief, do not seem to hold their values.

Trigger warning

At this juncture I need to issue a trigger warning.  Below I discuss and present evidence for the above contention the that the values the West promotes — and indeed rely upon to bind together the PWLO — are not shared by most people beyond its borders.  In fact, it would be more accurate to describe Western values as an outlier, in the sense that many other countries’ values — even those of rival religions and political ideologies — are closer to each other than to the West.  A key element of my thesis, that we stand on a precipice, one step away from a Complexity cascade that would bring about the swift and final end of the PWLO, is that most Westerners — not just President Biden — are blind to the values bubble of their own creation.

One result of that bubble and the blinders that (often) accompany it is that some of the ideas I describe below may appear so foreign that they shock or even offend.  This is especially true of an issue that is one of the most highly charged of flashpoints between the West and many developing countries: sexual rights.  For most of us in the West, myself included, sexual orientation is now clearly accepted as a human right.  But as I demonstrate below, most non-Western cultures view sexual and reproductive issues not as individual rights but as issues of collective cultural values and social order.

Two examples from the survey data I use in my analyses clearly illustrate the chasm between the West and others on the issues of sexual rights versus cultural values. The World Values Survey (WVS) is a detailed set of over 94,000 personal interviews across 64 different countries.⁵⁸   Among the survey questions are two that ask respondents to rate on a 0-9 scale the acceptability of “homosexuality” and “sex before marriage.” In Western countries, the average of within-country share of respondents who report that “homosexuality” is “never acceptable” (0 on the 0-9 scale) is 10.6%, while 6.6% feel the same about premarital sex. In sharp contrast, among non-Western countries, the average within-country share of respondents who believe homosexuality is never acceptable is 47.2%, while 36.8% say the same of “sex before marriage.” In roughly two-thirds of non-Western countries, the share of respondents for whom both sexual activities are “never acceptable” is triple that of Western countries.  This staggering difference stems from the equally wide chasm in world views: in the West sexual choice is an individual right, whereas in most other countries sexual relations are defined as cultural norms to which one must adhere. As difficult as it may be for some in the West to accept, their culture not only is not universal, it is a true outlier.

The Western outlier

Like Tom Holland, Joseph Henrich, an evolutionary biologist at Harvard University, also sees the West as distinctly different from other cultures and he similarly roots that difference in the early Christian church.⁵⁹  He describes the West as WEIRD: Western, Educated, Industrialized, Rich, and Democratic.  Dr. Henrich’s psychological research is based on large-scale, cross-cultural comparative experiments on psychological and behavioral variables, not values per se.  He also notes a psychological characteristic of Westerners that well accords with my contention that the West is blind to its own differences: a tendency to seek and see universal truths where none exist.  But a comparison of values rather than psychology reveals that the West is not just weird, it is a mathematical outlier.

Figure 1 from the World Values Survey (WVS) provides a visual representation of how different Western values are from the rest of the world.  The Inglehart-Welzel World Cultural Map reduces the 259-question WVS of social attitudes and cultural values into two dimensions of “traditional versus secular values” and “survival versus self-expression” (defined by Inglehart and Welzel).⁶⁰  Inglehart and Welzel’s original color overlay helps illustrate broad cultural groupings, but deceivingly also gives the impression that cultural continuity is greater than it is.

The true weirdness of Western values is better seen in the density and spacing of the 107 individual country dots across the “map.”  The majority, which I have annotated with a green-dash circle, 81 in total with a few stragglers just beyond its borders, crowd around the (0,0) point on the graph.  A sparsely populated zone with another 9 dots runs roughly “North-South” to the “East” of the main group, from Uruguay to Japan (annotated with a grey-dash box).  But most Western countries (annotated with an orange-dash oval) are tightly grouped, ironically, in the “Far East” of map.  There is an interesting — and noteworthy — exception: the US, nestled with Belgium and Luxembourg in the intermediate zone.  Its cultural position on the map may help explain why culture wars appear most intense in the US among Western nations.

The visually apparent cultural distance of the West from other countries can be formalized and quantified.  Using the most recent WVS data set (Wave 7, based on 94,278 interviews in 64 countries over 2017-2022), I calculated the mathematical distance of each country’s culture from the Western “center,” both overall, based on answers to all 259 questions, and for 13 subgroupings of questions.  I defined the Western center as the (demographically weighted) average of responses from the seven Western countries in Wave 7 (Australia, Canada, Germany, the Netherlands, New Zealand, the UK, and the US).  Distance from the Western center was defined as the within-country, across-question average of absolute differences in individual responses from the Western center.

Figure 2, for the 64 countries in Wave 7, paints the globe with the overall (259-question) distance from the Western center.  As in the Inglehart-Welzel map, the West is visibly different (lighter) than the rest of the countries in the survey.  Also in keeping with the Inglehart-Welzel map, the US is not quite as “Western” as the other Western countries in the survey.

While the WVS has its own subgroupings, both they and many of the questions in the survey betray significant Western-values bias.⁶¹  As a result, I constructed my own subgroups.  From among the 259 questions in the WVS, I selected subsets of questions (listed in the Appendix) that address three broad subcategories — Personal values, “ESG”(Environment, Social and Governance) values, and Basic needs — and further divided those into ten subindices within them.  The final subcategory, Basic needs, relates less to cultural values than economic welfare, but there is an obvious tradeoff for some countries.  The ten subindices are listed as axes of a “spider graph” in Figure 3 with regions of the graph shaded in correspondence to the broader value subcategories.  Plotted across the ten axes are “webs” illustrating the distance of various regional/cultural groups from the Western center in each subindex.

There are two prominent features of Figure 3.  Most obvious and consistent with the previous charts, is how distant all other regional/cultural groups are from the West in every dimension.  African and Islamic countries appear to be in a wholly different orbit.  But even the values of other European countries, though closer, sit well outside of the subset I have defined above as the West.  The next notable feature is its imbalance: the far greater salience of the first major category, Personal values, in defining differences with the West.  By a significant margin, the greatest differences from Western values for each region are in: (i) the importance of family over the individual, (ii) women’s place in the home and society, (iii) sexual behaviors, and (iv) god and religion.  Only in Africa and Latin America, and only for survival (food, shelter and minimum income), are distances from the West greater than some of the subindices of Personal values.

How many divisions has the Pope?

According to legend, at the Tehran conference in late 1943, when Winston Churchill suggested that the Pope may be influential in the war against the Nazis, Joseph Stalin responded, “The Pope.  How many divisions has he?”⁶²  As you ponder a 20-month long war of attrition in Ukraine and the rapid and uncertain escalation of the Hamas-Israel war, you may be asking a similar question: do cultural differences really have any relevance to the dualist struggle between the US and the dragons for defining the world order?  I submit that they not only are relevant, but that they will play a crucial role in shaping both the future path of Global entropy and the world order that emerges from it.

As noted previously, socio-political myths/cultural values are weak adhesives at the level of international relations, but they are extremely potent weapons of division as attested by a millennia of religious and inter-cultural strife.  Like combined arms maneuver in combat,⁶³ military and economic power are far more effective when combined with diplomacy and information operations designed to exploit cultural differences.  The respective vision statements of President Xi and Putin reprinted above clearly incorporate exploitation of cultural divisions as part of a “combined arms” grand strategy in their “unrestricted warfare” against the PWLO.  They are likely to be aided in their efforts by other would-be regional powers like Iran and potentially Turkey⁶⁴ that view the PWLO as an impediment to their own aspirations in a new world order.

Weaponization of cultural differences also may contribute to Complexity cascades that accelerate both the speed and resulting disorder of Global entropy as it spreads to other regional powers that are more amenable to the PWLO. India, Saudi Arabia, South Korea, and Japan currently benefit from the current order and have historic rivalries with the dragons and their allies. But as the PWLO weakens, and with it their perceptions of the PWLO’s protections, their incentives may shift from defending it to self-preservation. Because these regional powers buttress the PWLO, the dragons have an incentive to exploit any cultural gaps between them and the West.

Finally, an understanding of cultural distances is necessary to forecast what will follow the PWLO. Regardless of the speed of Global entropy – whether it is a disorderly collapse or lingers impotently like the Holy Roman Empire – the order that emerges from its aftermath will require its own socio-political myth(s) to bind it. That process will require finding common cultural ties and will be made harder by weaponization of cultural differences during Global entropy.

Accidental guerrillas

As noted above, Western blindness to its own cultural weirdness is ceding favorable terrain on the battlefield to its adversaries.  Worse, contrary to President Biden’s characterization of Western cultural values as an “abiding advantage,” the West’s increasing tendency to link acceptance of Western cultural norms to PWLO membership is more likely a major strategic blunder.  The titular protagonists of another of David Kilcullen’s books, The Accidental Guerrilla, are neutral or even friendly populations that are turned towards insurgency by the actions and behaviors of a counterinsurgency force.⁶⁵  Similarly, by forcing countries adhere to Western values that may run counter to their own as a condition of PWLO membership, the West may be making “accidental guerrillas” of countries and driving into the arms of the dragon “insurgents.”

An explosive example

This is not just speculation on my part: it appears to be happening in one of the most strategic global battlegrounds, Africa,⁶⁶ in a conflict over fundamentally different views of sexual orientation.  The issue is inflaming relations with the West across the continent, but Uganda, where a recent law makes “aggravated homosexuality” punishable by death, has become a flashpoint in the conflict.  As noted in my trigger warning, the West views homosexuality as a human right, while most Africans see it in terms of cultural values.  These radically different perspectives — and the West’s blindness to the difference — are plainly apparent in the contrast of tone and emphasis of the Western press’s coverage relative to the African press.

In articles earlier this year on Uganda’s law, both the British Broadcasting Company⁶⁷ and the American Associated Press⁶⁸ frame the conflict in terms of individuals’ universal human rights, defining it in the language of Western leaders and the UN human rights office.  As if to illustrate their blindness to the culture conflict at the root of the conflict, both articles blame the newly passed Ugandan law on legacy colonial laws.  Without irony, the AP reporters immediately follow that assertion by noting that Archbishop Stephen Kaziimba, head of the Ugandan Anglican church who spearheaded the law, has split with the Church of England over the issue.

For a shockingly different perspective on the conflict, consider an op-ed in Nigeria’s second largest newspaper, The Guardian.⁶⁹  Though potentially jarring to many Westerners, it is worth a read for anyone unfamiliar with traditional cultures’ perspectives on these issues.⁷⁰  The op-ed is well researched, highly legalistic and focused on the rule of law, national sovereignty and the importance of national identity.  Citing juris precedent from the European Court of Human Rights, the 1948 Universal Declaration of Human Rights, the African Charter on Human and People’s Rights, and sovereign laws throughout Africa, and noting that “[t]he rule of law is a critical factor in empowering individuals, improving human flourishing, and preserving peace in a country,” the op-ed flatly states that “Same-sex gay marriage…[and] LGBTQ1+ are not human rights…There is no known international law that obliges Nigeria and other African countries to legalize gay marriage and LGBTQ1+.”

Illustrating clearly the powerful wedge these issues create for the dragons to fracture the PWLO, the authors assert that “LGBTQ1+ goes against our culture, tradition, and beliefs” and advocate that “Nigeria should hold tenaciously to this position notwithstanding the threats or sanctions brandished by the West.”  Citing UN law that “every developing country…must reflect the diverse social, economic, and environmental conditions of the continent with full respect for their religious, cultural backgrounds, and philosophical convictions” the op-ed decries that “subscription to [the] LGBTQ1+ aberration” now is a precondition for World Bank loans and academic research grants, that the EU is pushing to include a mandate to legalize LGBTQ1+, abortion and transgenderism in the EU-Africa-Caribbean and Pacific trade agreement, and that “U.S. President Joe Biden has made LGBTQ1+ the centerpiece of American foreign policy.”  The article closes by noting that “Nigeria is a sovereign country with the right to decide for herself the kinds of laws to enact for her own good…A people without identity are a people without existence…[Nigeria] must remain [true to its identity] in the interest of the country’s democracy, foundational philosophical and legal principles.”

The issue of sovereignty is also key to the African perspective in a more balanced article in the Ugandan Monitor that acknowledges the Western human rights perspective, but also plainly identifies Western economic coercion — restricting development loans, aid and foreign direct investment — as interference in the sovereign choices of democratic nations.⁷¹  The Monitor quotes Ugandan President Yoweri Museveni, “Uganda will only happily work with all the countries that respect its sovereignty.”  And, these are not minority views in Africa as protests and political activity from Ghana to Kenya to Mozambique to South Africa attest.⁷²

It is not an accident that the words chosen by Presidents Xi and Putin in their respective pitches for an alternative world order closely jibe with those of The Guardian op-ed writers and President Yoweri Museveni.  Iranian President Ebrahim Raisi, on a tour of Uganda, Kenya and Zimbabwe earlier this year — the first visit to Africa by an Iranian leader in 11 years — was even more pointed, focusing much of his rhetoric on Western pressure over sexual rights and its disrespect for national sovereignty: “The Western countries try to identify homosexuality as an index of civilization”; “by promoting homosexuality they are trying to end the generation of human beings”; “acting against inheritance and culture of nations”; and are “not generally interested to see countries who enjoy great resources and national reserves to be independent.”⁷³  Demonstrating that Iran is no less proficient at “combined arms” diplomacy, President Raisi offered financial support for an oil refinery and pipeline in Uganda that is opposed by European nations and signed five memoranda of understanding with President William Ruto of Kenya.

With strings attached (to repel rather than bind)

There is compelling evidence that the wedge created by these issues is having measurable realignment effects and hastening Global entropy.  A recent academic paper by researchers at the University of Bern finds, seemingly counterintuitively, that Chinese bilateral aid and assistance are more influential with democracies than autocracies in aligning nations’ UN votes with China.⁷⁴  Yet their results are straightforward in the context of the example given above and the respective choices autocratic and democratic leaders face when international relations are fought on a battleground of cultural values.

In autocracies, leaders do not need to seek popular support to enact laws, nor do they need to enforce them if they know their populations are opposed.  In contrast, as explicitly noted in The Guardian op-ed above, the rule of law is a fundamental principle of democracy and representative governments must reflect the will of their voters or face removal.  Western powers are presenting a no-win choice to elected representatives in democracies with values that fundamentally collide with the West: be voted out of office for enacting laws their populations strongly oppose, or lose access to Western support.  When China, Russia and even Iran are offering support without values-strings attached, the choice becomes easy.

To test this thesis, I ran a couple of simple cross-sectional regressions on determinants of countries’ UN votes in favor of Ukraine/opposing Russia’s invasions, including its 2014 annexation of Crimea.⁷⁵  Taking advantage of the same extensive database on Chinese official and unofficial aid as the researchers in the University of Bern study (AidData),⁷⁶ I focused my analysis on China’s potential influence on UN votes.  That the votes relate to the actions of Russia — which China supports — rather than to China itself makes the results even more powerful.

In the first model I included each country’s total exports to and imports from China, both as shares of GDP, to measure the effects of and control for the depth of economic relationship. To assess the influence of Chinese financial aid I included the annual average of total aid received from China (official development, military and Huawei assistance), again as a share of recipient-country GDP. Finally, to measure the independent effect of cultural values, I included the country’s cultural-values distance from the Western center (average), as described earlier.  The top panel of Figure 4 displays the results.  Neither trade variable has a statistically significant effect on UN votes (both p-values, the probability that is no relationship, are greater than 0.85).  But, consistent with the previously cited study, aid from China does have a statistically significant negative effect on countries UN votes in favor of Ukraine (with the statistical probability of zero relationship just 1.3%).

Yet, even after controlling for economic relationships and all forms of Chinese aid, a country’s cultural distance from the West also has a negative effect on votes for Ukraine that is of the same degree of statistical significance as aid.  Staggeringly, putting the coefficients in comparable terms, Model 1 suggests that a cultural distance from the West roughly equivalent to the average distance of other European countries from the West in the spider diagram of Figure 3 is worth 6.8% of recipient-country GDP in annual assistance.⁷⁷  Given that many African and Islamic countries are more than four times that distance, Model 1 suggests that enforcing adoption of Western values is equivalent to paying whole nations — or perhaps even a whole continent — 25% of GDP per year to study human rights law.

Model 2 in the lower panel of Figure 4 omits the trade variables and focuses on different types of aid: development aid, military aid, and infrastructure aid from Huawei, a Chinese telecommunications technology company at the forefront of 5G communications networks.  Interestingly, when Chinese aid is broken into component parts, none of them are as statistically significant as they are in sum, though Huawei aid (the smallest component by far for most recipient countries) appears the most statistically significant in aligning countries with China.  However, given the high degree of correlation between the three types of aid, however, that implication is less clear.⁷⁸  But the effects of cultural distance are robust: both their magnitude and statistical significance are undiminished.

Global entropy is inevitable, but adaptation may slow it

The clear implication is that cultural values do matter for international relations, but for many countries they have the opposite effect to President Biden’s intent when he refers to them as “America’s abiding advantage.”  For policymakers, the lesson here is that coupling Western values acceptance with aid comes at a cost, an extremely high cost if coefficients of Model 1 are to be believed.  The question then becomes whether it is worth that cost.

International relations is all about tradeoffs.  A variety of studies show that conditionality in development lending can be more counterproductive than helpful in achieving its stated aims, particularly human rights.⁷⁹  Other research questions even the moral foundations of coercive aid, noting its unavoidable tension with rights of self-determination, which undermines the socio-political myths undergirding PWLO international institutions.⁸⁰  If Apex neoliberalism’s moral interventionism is ineffective, of questionable moral validity despite the goodness of its intent, and risks dissolution of the international architecture with attendant consequences that include increased potential for warfare, it is fair to ask whether it should be abandoned in favor of an alternative.

There are voices for change.  Amrita Narlikar, president of the German Institute for Global and Area Studies in Hamburg points to two opposing narratives for the problems of the PWLO.⁸¹  The first, “Resuscitate and Reinforce” argues that the problem is abuse of it by individual members and that its institutions need to be strengthened to contain them.  Without irony, advocates of this view generally cite former US President Trump’s turn to isolationism and “America first” policies as examples of member-state abuse of PWLO institutions.⁸²

The second narrative, “Restructure,” instead believes the PWLO needs fundamental restructuring and views home-country-first policies as a bedrock of honest multilateralism that better reflects state sovereignty.  Dr. Narlikar notes that one variant of the Restructure narrative, notably espoused by NATO Secretary General Jens Stoltenberg, focuses on building alliances of common values rather than pushing common values on those that do not hold them.

There are historical precedents for an American foreign policy that includes morality but applies it more flexibly. A key foreign policy debate in the 1980 US election was between the moral absolutism of President Jimmy Carter and the flexible realism of President Ronald Reagan. Mr. Reagan won the election and over his succeeding two terms in office, despite supporting dictatorships that partnered with the US against the Soviet Union, oversaw the transition of several of them in Latin American and Asian to democracy through persistent soft diplomacy in the background.⁸³

Given Global entropy’s advancement past the likely point of no return and the potential for culture to act as both repellant and adhesive in international relations, Western adoption of this variant of the Restructure narrative likely will play a determinative role both in what global order succeeds the PWLO and whether that path is disorderly or evolutionary.  For markets, the lessons of the above analysis are even clearer than for policymakers: if Western powers fail to adapt and continue to fight on the battleground chosen by the dragons and their allies, Global entropy likely will accelerate and risks a disorderly descent into a Complexity cascade with attendant increase in geopolitical, economic and market Uncertainty.

Battlefield topography and axes advantages

To assess both how quickly Global entropy may proceed, where its points of fracture lie, and ultimately what order may emerge from it, a careful examination of the field of battle is useful.  Figure 5 presents the cultural distances of the 64 countries in Wave 7 of the WVS from the Western center (average) along two cultural-values subcategories introduced earlier: Personal values (family, the role of women, sexuality, and religion) and quasi-ESG values (individual freedom, tolerance and the environment).  Countries are color-coded by their regions as defined earlier in Figure 3.  Even more so than Figure 3, it highlights how “weird” the West is relative to the world.  It also makes clear that the West may be smaller than it thinks of itself considering the distance of countries like Czechia, Greece, South Korea and even Japan.

Isoquants of distance (semi-circular lines in Figure 5) show Western cultural values’ figurative “fires range” on the cultural battlefield.  The isoquants are spaced at roughly the unit of distance shown in Model 1 to be worth development aid equal to ~6.3% of recipient-country national income.⁸⁴  While the West may be smaller than it defines itself, the innermost pair of isoquants suggest the nations that are the battlefield for cultural adhesion; i.e. those countries that are more likely to share sufficient values with the West to form stable alliances in a new world order.  Countries beyond that range are instead more likely to be repelled by Western cultural values than attracted and thus are more susceptible to the dragons’ cultural warfare.  Countries beyond the last isoquant are so distant from the West that, as tensions over sexual rights in Africa attest, pushing Western values are highly likely to push them into the dragons’ arms.  That includes two would-be regional powers, Iran and Turkey, that may have an advantage in plying countries away from both the PWLO (as Iran clearly is attempting in Africa) and the dragons.

But the relative positions of both the dragons and would-be regional powers to other countries is deceiving.  Figure 5 measures cultural distance from the West, not one country versus another.  By analogy, both Chicago and Karachi are roughly equidistant from London, but are nearly twice that distance from each other.  Thus, while Korea appears to be “next to” Russia on Figure 5, its overall cultural distance from Russia is nearly as great as Uruguay from the Western center (see Figure 7 below).

Figure 6 repeats the cultural values distance map of Figure 2 (upper right) for comparison with China (upper left), Russia (lower right), and “Others” (lower left), defined as the center (average) of non-Western countries’ cultural values.⁸⁵  As culturally weird as the West is from the rest of the world, the dark shading of nearly the whole globe in the upper left of Figure 6 shows that China is practically an alien.  This should be taken with a grain of salt given that all surveys in China are monitored by the CCP and many of the WVS survey questions were omitted in China.  But it seems fair to say that while cultural values may be an effective weapon of repellant for China in fracturing the PWLO, they may not be useful in returning China to its desired role as the “Middle Kingdom.”

While not easily apparent with Microsoft’s color scaling, the cultural distance of Russia from most countries (other than China and Egypt) is narrower than from the West, suggesting that it may have an easier time than China using culture as an adhesive to build alliances in the post-PWLO order.  The “Other” map is a bit difficult to interpret as it isn’t the cultural values of any specific nation or group of nations with shared cultural heritage like the West, but rather the average of all other countries.  But in lieu of doing this analysis for every possible regional power, it serves as a useful proxy of regional powers’ cultural affinity.  The shading of the Other quadrant map, as one might expect from its definition, is both lighter (culturally closer) overall and more varied than the other quadrants, indicating that there is significant room for regional powers to form culture-based alliances to compete with the great powers.

Although daunting at first glance, Figure 7 provides a more detailed and analytically useful representation of Figure 6.  Each of the four quadrants plots the overall cultural distance of countries from two different geopolitical poles: West versus China in the upper right; West versus Russia in the lower right, Russia versus Others in the lower left, and finally, China versus Others in the upper left.  Countries’ relative distances are shown by the markers in each quadrant that are color-coded for region (with China and Russia illustrated by dragons of course). The 45º lines in each quadrant represent where countries are culturally equidistant from the two poles, hence each quadrant can be divided into two “triangles of cultural advantage.”  For instance, country markers falling in the two green triangles are closer to the West than to, respectively, China (upper-right quadrant) or Russia (lower-right quadrant).

Keeping in mind the earlier caveat regarding the possible problems with the WVS in China, Figure 7 makes even more clear China’s problem in building alliances based on culture.  The only country culturally closer to China than the West is Egypt, the far-outlier orange dot in each quadrant.  In the upper-left quadrant, no country is remotely closer to China than to the Other center.  This suggests that in any new world order, China’s route to dominance will be based purely on military and economic power.  That doesn’t make it impossible, but international relations built solely on power are more difficult achieve and less stable.  China’s “culture problem” reinforces the notion that is partnership with Russia, a European Orthodox country with few cultural similarities, is based on complementarity in powers and the repulsion of both from the West.

Russia is in a much better position vis-à-vis the West.  Only two non-European countries, Uruguay and Japan, are culturally closer to the West than Russia (the other Latin American marker in the Western triangle is Puerto Rico, a US Territory).  This gives Russia an advantage within its duo-pole with China, given the latter’s apparent culture problem.  The allies of the Sino-Russian duo-pole in a new world order are much more likely to side with Russia culturally, potentially posing a problem for the stability of their duo-pole, especially if the West weakened significantly, lessening the repulsion pushing them together.

Turning to the left half of Figure 7, the strength of regional powers becomes apparent.  Admittedly, it is partially by construction, but the Others center is culturally closer to every country than either China or Russia, with the exceptions of Czechia and Ukraine that are marginally closer to Russia.  Furthermore, keeping in mind that distances between markers do not necessarily indicate cultural closeness of the associated countries, the placement of would-be regional powers Iran and Turkey in all four quadrants — in the middle of the pack and closer to Islamic and African countries — does suggest that they each have cultural advantages in finding regional alliances.

Endgame: Postulating a new world order

Culture alone will not determine the shape of the new world order that emerges from Global entropy.  A stable world order will need to be underpinned by economic might and military power.  But cultural differences likely will play a determinative role in how Global entropy progresses from here, and in particular, how rapidly it advances.  The speed of entropy will, in turn, have a large effect on economic and military power dynamics, and in a disorderly descent, the role of cultural differences may be as great or greater than wealth and power in determining the outcome.  As a result, even though culture is likely to play second fiddle to economic and martial factors in orchestration of the new world order, it likely will write the score.

An evolutionary path to global bifurcation

Global entropy already has been underway for more than two decades, and despite bumps along the way and a significant step-up in Uncertainty from historically low levels, the path has been relatively smooth to date.  Even current global disorder, including a major war in Europe, a smaller one in the Middle East, and ongoing threats in Asia is relatively peaceful in comparison with much of recorded history.  The most likely path forward is one of steady evolution towards a new equilibrium in international affairs.  If Global entropy proceeds slowly, other fundamental forces determining wealth and power — primarily technology — are likely to generate a bipolar world with lesser regional powers playing a role.

The geostrategic implications of Global entropy, acceleration of increasingly specialized technological advancement, and path dependence are pushing the global economy and military power towards Global bifurcation.  Technological advancements are driving both an increasing share of economic value creation and military advantage.  As a result, and as we already see in rapidly multiplying controls on technology exports and information, leadership in technology and associated mechanisms of control will be the new currency of economic and military power.  Two centers of technological excellence — the Anglosphere and China — are rapidly outpacing all others.  The proliferation of controls, rising Localization of production, and the increasing influence of path dependence generated by the concentration of leading universities, research institutes and learning-by-doing in these two centers of excellence likely will reinforce their dominance.

The bipolar ascendancy also will be reinforced by economic network effects.  As Localization replaces outsourced global supply chains, particularly within the technology bipoles, the nature of “economic coercion networks” will change.⁸⁶  The interdependence of suppliers and procurers in the globalized system likely will yield to greater coercive power of technology leaders, via export controls, over increasingly supplicant trading partners.  That process would further consolidate and entrench network externalities that stabilize the bipolar system.

But one group of exporters likely will retain power over the technology originators in the new economic order: producers of essential natural resources, especially those needed for advanced technologies (critical minerals) and the functioning of economic activities (energy).  The uneven geographic distribution of these resources across nations has important implications for the form of bipolarity, geopolitical alignments and space for regional powers that manifests.

While the Anglosphere is well resourced — the US, Canada and Australia lack few if any natural resources — China would be dependent on external sources: Russia, Africa and Latin America.  Supply from the latter two would leave China dependent on open sea lanes (and alliances) in a world of distributed, autonomous weapons with long-range fires capability.  This vulnerability and Russia’s need to access advanced Chinese manufactures likely will reinforce their strategic coupling as a duo-pole.  Investment in hardened over-land transportation networks likely will further cement the relationship, as will the cultural repulsion force of a strong geopolitical rivalry with the Western pole.

Despite the Anglosphere’s resource advantage, strategic rivalry between the bipoles likely still will result in intense competition for resources that creates a more fluid system of international relations with spheres of influence for lesser regional powers.  Cultural affinity and mutual security should continue to bind Western Europe to the Anglosphere, while cultural rivalry (with China) and mutual security should keep Japan, India, and South Korea within the alliance.  Similarly, North Korea and most former Soviet states likely will be bound to the Sino-Russian pole by cultural repulsion and trade dependencies.  But each side’s allies will require their own secure resource supplies, pushing both poles into competition to secure the resources of Africa and South America.  Distance, proliferation of cheap but increasingly sophisticated and accurate weapons, and resource constraints on both poles likely will allow for greater fluidity in international relations outside the core alliance networks and increased reliance on regional powers.

Regional power aspirants Iran and Turkey can be expected to step into that breach to build independent regional power bases that play the bipoles off each other.  Both can draw upon broad cultural networks (Muslims and Turkic speakers), closer cultural distance to other traditional cultures, and their burgeoning (albeit lesser) leadership in affordable military technologies to tap into the more fluid landscape of international relations.  With the exception of Saudi Arabia, who likely will be driven towards alliance with the West by Iran’s alienation from it, there are few other countries with the combination of aspiration, resources, political cohesion, economic stability, and technological sophistication to emerge as regional powers in the bipolar order.

An evolutionary path of Global entropy to a new world order still faces significant Uncertainty and likelihood of strife.  But it likely will allow for more rapid global growth that ultimately strengthens the Western pole relative to the Eastern pole. The latter, particularly China, faces more significant demographic decline, less internal dynamism and more significant internal economic challenges, including overcoming the “middle-income trap.”⁸⁷

Rapid descent to anarchy

In contrast, a rapid pace of Global entropy is far more likely to disrupt economic networks, weakening the power of technological leadership to coalesce into two firm bipoles, and lead to a more fractured global order, or even the absence of a stable order for an extended horizon.

A rapid unwind of Global entropy is most likely to arise from self-reinforcing extended conflict between global powers, likely involving regional powers, that encompasses the full range of warfare: economic, information, cyber, space, and kinetic.  Despite their technological advantages, the West and China — both overly indebted already — would be severely drained by the experience, impairing their ability to lead or even form alliances.  Global economic growth would be depressed by disorder, the possible end of safe, reliable sea lanes for trade, and fracturing of the global political and economic system.  Even Localization of production likely would be slower amid the higher debt, defaults, and Uncertainty that result.  Accordingly, the evolution of bipolar technical and economic domination from path dependence and network effects likely would be slowed or perhaps even stalled.

Both the West, with its prestige damaged, perhaps irreparably, and an economically and militarily stretched China that is culturally distant from everyone likely would struggle to form alliances as the radius and credibility of their respective security umbrellas receded.  A weaker Western alliance would, in turn, weaken the Sino-Russian relationship as Western repulsion became less meaningful, while China’s demographic decline and economic malaise, and Russia’s greater advantages in forming relationships of cultural affinity would reduce its incentives to couple with China.

The diminution or even disappearance of bipoles would create a vacuum that would draw in a wider collection of regional powers.  Russia, India, Japan, Saudi Arabia, and perhaps even Indonesia and Poland likely would join Iran and Turkey in the ranks of regional powers.  A weakened Anglosphere and Western Europe likely would remain in cultural alliance, but be less able to project power in an increasingly fractured world.  Without strong bipoles to suppress them, jockeying regional powers likely would further exploit and be driven to conflict by cultural differences.  Turkey and Iran could come into conflict with Russia and China over Turkic-speaking, Muslim peoples in the former Soviet states and China’s Xinjiang, or could be drawn into potential sectarian conflicts between India and its Muslim neighbors or Indonesia and its non-Muslim neighbors.

Regional power conflicts likely would spill over into proxy wars in both Africa and Latin America, where, at present, no states appear politically and economically strong enough to become independent regional powers.  (Both Brazil and Venezuela have the potential, but suffer from weak internal institutions and political stability, excessive debt, and poor human capital.)

The forces of technological progress that are likely to drive Global bifurcation in the base case ultimately lead to more stable international relations in the case of a chaotic collapse of the PWLO.  But the process would take longer and, if sufficiently long for the Anglosphere and/or China to lose their technological edge, could result in something other than a bipolar order.

The market and economic implications of the rapid path for Global entropy are a marked rise in Uncertainty from its already elevated levels, slower global growth with potential for a large drop in global trade, and widespread defaults and hyperinflations.

Culture, complex systems and the path to chaos

While the less-chaotic evolutionary path of Global entropy is more likely in my view, as noted before, the world stands on a precipice of a potential rapid descent into a Complexity cascade that would bring about the second, more dystopian scenario.  The probability of the latter is uncertain, i.e. both unknowable and non-quantifiable, like the probability of an astroid strike or tsunami.  Yet the combination of Global entropy’s advanced stage, the emergent roaring of dragons, the West’s apparent blindness to its own danger, and recent developments in international relations, including the newly flared war between Hamas and Israel, all suggest to me that the probability is significantly higher than that of a cataclysmic natural disaster.

Which path we take is a function of complexity, which is why its likelihood, timing and even form is unknowable.  Yet, unknowable does not mean that we cannot prepare for it.  In later research, I will address how to insure one’s portfolio against the unknowable, both specific (“known unknowns”) and general (“unknown unknowns”).  Important to both, but especially the former, is to understand a Complexity cascade, a Theme I coined during Covid to describe the Uncertainty created by and nonlinear potential of complex systems when they fail.⁸⁸

How catastrophic collapse happens

All human structures — from book clubs to nations to international orders — are complex systems, meaning they are formed by many independent, usually unpredictable parts.  While they often give the illusion of stability, they are inherently non-linear, both internally and in their potential for rapid, unpredictable catastrophic failure.  In a masterpiece of brevity and insight, Dr. Richard Cook described in 18 short paragraphs how and why complex systems fail catastrophically.⁸⁹

Among its insights are that “complex systems are intrinsically hazardous systems” [paragraph 1] that always operate in “degraded” or broken mode [5], i.e. small failures are ever present, like squabbles over which book to read, violent crime or border skirmishes.  The mix of failures is constantly changing [4], which is how its internal components — people — learn to repair and stabilize the system [9, 16 & 17].  But Dr. Cook notes that in any complex system, “catastrophe is always just around the corner” [6] and identifies the following key characteristics of catastrophic failures:

• A chain of failures that overwhelms the system’s ability to operate in broken mode. [3]

• Change that introduces new rare but high-impact forms of failure. [14]

• Hindsight-biased safety mechanisms. [7, 8, & 15]

• Lack of experience with failure. [18]

• Failure to anticipate and adapt to change. [12]

Relating Dr. Cook’s insights to the present global circumstance should well illustrate why I am so concerned about the potential for a Complexity cascade, i.e. the rapid, unpredictable and catastrophic failure of the PWLO.

• High potential for a cascade of failures to overwhelm the system: In addition to the Russo-Ukrainian and Hamas-Israel wars, civil wars continue to rage in Syria, Libya, and across many parts of Africa.  The Hamas-Israel war has the potential to envelope other Middle Eastern powers, especially given Iran’s suspected direct involvement.  More pertinently, the explicit Russian and Chinese support for Hamas — despite Israel’s deep technology ties with China and abstentions on UN votes involving Ukraine — suggest that both see the war as a convenient distraction for the West, at a minimum, and potentially an opportunity to overwhelm the US with “many small fires” that either spread the US too thin to meet its security commitments to allies (including Taiwan and East Asia) or force it to withdraw support and lose credibility.  The world is not short of kindling for would-be arsonists to set ablaze: the Korea peninsula, the Kashmir, the Serbian-Kosovar border, and the Colombian-Venezuelan border; potential immigration crises on the Mediterranean and US Southern border; a highly contentious upcoming US election where partisans on one side see indictments against former President Trump, who leads in polls, as election rigging, and partisans on the other see him as a fascist threat to democracy; a potentially inflammatory Taiwanese election in January against the background of Chinese invasion threats; rising Chinese belligerence in the South China Sea; recent Russian threats to Polish sovereignty.⁹⁰

• Rapid socio-political, economic and technological change: Technology (artificial intelligence, automation, communications, data rights management, edge processing, facial recognition, quantum computing, and visual processing); Economic structure (shift from outsourced globalization to automated Localization); domestic politics (The Politics of Rage, culture wars); international relations (Global entropy, the emergence and rise of the dragons); and defense (proliferation of cheap, small, modular, stealthy, autonomous systems, long-range strike capabilities, expansion of warfare to the information, cyber and space domains).

• Hindsight-biased focus on the wrong problems in international diplomacy: Dr. Narlikar’s narrative of Resuscitate and Reinforce remains the dominant view among political elites and, especially, the Western diplomatic corps.  Bureaucrats remain focused on legacy PWLO mechanisms, institutions and failsafes, and either ignore or appear paralyzed when the dragons step outside the “rules-based order” as is occurring with increasing frequency.

• Western leaders without experience in failure:  The current crop of Western leaders — in both politics and business — largely rose through stable systems during the period of Apex neoliberalism.  The combination of stability and increasingly detailed micro-analyses of voter preferences favored “leaders” who’ve never made a significant mistake or experienced failure, and punishes both those that do, whether they learn from mistakes or not, and gamblers, whom Dr. Cook identifies as essential to solve novel problems in a complex system [10].

• Western inability to anticipate change or adapt to it:  The West appears completely self-absorbed in its own cultural debates, blinding it to the vast chasm between its values and those of other nations, or the offense they may cause in international relations.  Much of the West also seems to have only recently, and perhaps not fully realized that it no longer operates in the hegemonic world of Apex neoliberalism and that dragons are now roaming, roaring and preparing for attack.  Consequently, it remains ill-prepared and hidebound in its approach to international relations.  While there are elements pushing for change and adaptation, as noted above, those voices are far from winning the debate.

In sum, all the elements necessary for rapid, complete and catastrophic failure of the PWLO appear to be in place.  This doesn’t mean it will happen, but the potential is now too great to ignore in investment or strategic business decisions.

Complexity cascades: expect the unexpected

A complex system failure is not in itself what I mean by a Complexity cascade; it is only its trigger.  The Complexity cascade is the nonlinear sequence of aftershocks that propagate in its wake.  Importantly, the larger the system failure, the larger its shock waves and reverberations.  The end of an unprecedented unipolar order that lasted three-quarters of a century is an immense failure with equally large consequences.

By their nature the consequences of Complexity cascades’ aftershocks, their timing and for how long they last are unknowable.  My speculation on what a rapid, disorderly end of the PWLO might look like is painted in broad brush strokes. But there are other less cataclysmic risks to consider that also have an increased likelihood amid ongoing Global entropy.

Interstate wars:

The end of PWLO also implies the end of adherence to Article 2(4) of the United Nations’ Charter that prohibits changes in international borders through or under the threat of force.⁹¹  Russia’s invasion of Ukraine on the pretext that it is an artificial country with artificial borders likely is just the first fusillade fired at the ramparts of Article 2(4).  Most European colonies, the borders of which often were drawn across or to include rival tribes and ethnic groups and remain contentious, did not gain independence until after the signing of the UN Charter in 1945.

• Chinese invasion of Taiwan/war with Western allies:  “One China” has been the policy of both China’s since 1949, the People’s Republic under President Xi has grown increasingly aggressive in asserting its right to reunification by force and is preparing accordingly.  As noted earlier, China now possesses the capability to deny entry to the Western Pacific through the first island chain, which includes Taiwan.  Taiwan’s 13 January presidential election may be a flashpoint given the lead of pro-independence candidate, Vice President Lai Ching-te, or merely serve as an excuse for war.  I had originally thought that the failure of Russia’s coup de main during its invasion of Ukraine, and even more so the internal stability danger demonstrated by the Wagner rebellion lessened the likelihood that President Xi would attempt an invasion (Wagner’s lessons).  But the string of high-level Party and PLA purges, including two cabinet level officials, the head of PLA’s Rocket Force, its senior political officer, and many mid-level officials,⁹² and the suppression of public mourning after the surprising death of the popular former Premier Li Keqiang at just 68 years of age,⁹³ all occurring amid accelerating preparations for war suggest that President Xi took a different lesson from those events: eliminate anyone who opposes invasion and represents an internal threat if it goes poorly.

• India-Pakistan war: China has many reasons to support and encourage Pakistan to attack the disputed Kashmir region: to distract the West, to advance its own position in the Himalayas, or to prophylactically distract India from joining a Western effort to defend Taiwan or to retaliate if India did.  While the Kashmir skirmishes of the last two decades have been restrained by US pressure on both sides, in the case of Chinese support for Pakistan, especially amid a Taiwan Straits war, the war could escalate rapidly and potentially even go nuclear.

• Iran-Saudi Arabia-Gulf war: The brazen drone-swarm attack on Saudi Arabia’s Abqaiq oil processing facility in 2019 is believed to have been undertaken by Iran, as is logistical and material support of Hamas’s attack on Israel last month to prevent an Israeli-Saudi rapprochement.⁹⁴  Iranian and Saudi antagonism runs deep and a key restraint on all-out war has been the US presence in the Persian Gulf.  If US naval forces are stretched thin by other “fires” or fully engaged in the Pacific in defense of Taiwan, the gloves are likely to come off.  Any war between Iran and Saudi Arabia likely would involve all the Gulf states, including potentially reigniting an Iraqi civil war, implying that roughly a third of global oil production could be disrupted.

• Iran, Turkey and Israel redraw Middle East’s Sykes-Picot boundaries: Iran, Turkey and Israel all have been actively involved in Syria’s ongoing civil war, with Turkey pursuing Kurdish rebels and Israel and Iran fighting a proxy war.  Despite both Iran and Turkey having significant Kurdish minority populations with fledgling independence movements, neither power has intervened in the autonomous region of Iraq due to US protection.  Similarly, despite the effective split of Iraq into two separate countries for two decades and Syria’s division into multiple regions of control, the official boundaries of both countries remain sacrosanct under Article 2(4).  But, again, with the US potentially occupied fighting fires elsewhere, Southern Iraq already an effective client state of Iran, Turkish territorial integrity threatened by an autonomous Kurdistan, and both countries’ aspirations to become regional powers, joint or separate invasions of both Syria and Iraq that likely would be met by a defensive invasion by Israel are not farfetched.

Civil wars and state failures:

• EMU dissolution:  I highlighted the worsening sovereign debt dynamics in Europe in Veni, vidi, vocavi, Part II and the risks to the banking system in Opportunity knocks; are you listening?  Europe’s challenges would likely increase sharply with a rapid breakdown in global order.  The potential for the war in Ukraine to move closer to Europe’s borders would rise if outright interstate conflict broke out between the West and either of the dragons.  Further, the likely increase in wars across Africa and the Middle East (discussed above and below) likely would result in destabilizing refugee flows.  Combined with a likely economic downturn and increase in global risk aversion, the pressure on periphery sovereign yields would almost certainly become too great for the ECB to halt.  The path of least resistance likely would be a breakdown in the European Monetary Union.

• Nigerian civil war:  Many states in Africa, like those in the Middle East have former colonial boundaries that run afoul of tribal, ethnic, religious, and linguistic boundaries, have weak or underdeveloped institutions, and consequently are at higher risk of civil war in a post-PWLO/post-Article 4(2) world.  None more so than Nigeria, Africa’s largest country by population, with 230 million people from 371 tribes speaking over 500 languages and roughly evenly divided between Christians and Muslims. According to the WVS, 2/3rds of Nigerians fear civil war, though few are old enough to remember the 1967-’70 civil war where one of the three largest tribes, the Igbo sought independence after one of the other three, the Hausa, initiated an ethnic cleansing campaign.  In a post-PWLO world, foreign powers likely will have as much incentive to exploit cultural differences within countries as between them in their scramble for African resources.

• US civil war:  It may seem a stretch to suggest that a US civil war might result from the collapse of the PWLO, but the nonlinearities resulting from complex systems’ failures often are difficult to imagine.  Peter Turchin has been forecasting a significant step-up in US violence in the 2020s for more than a decade.⁹⁵ The US already arguably is its most divided since the Civil War of 1860-’65, and predictions for civil war, from sustained low-grade terrorist activity to state secession have been discussed as possibilities since Donald Trump was elected president.⁹⁶  With even deeper divisions and distrust now sown and an election year that may result in an indicted, perhaps convicted candidate winning the Republican nomination and potentially the general election, the potential for a bonfire of US domestic strife is high.  Collapse of the global order the US created may be the match needed to start it.

• Chinese or Russian civil wars:  I noted the potential for internal strife in both China and Russia in Clash of the Themes and Wagner’s Lessons, and while the near-term likelihood of an internal coup or civil rebellion likely now is lower following President Xi’s purges described above and President Putin’s in the wake of the Wagner rebellion, the overall likelihood probably has not changed significantly.  The same underlying instabilities lie in both systems, the only difference is that both leaders have reacted to internal threats by actively eliminating perceived threats.  Recall from Dr. Cook’s insights into the failure of complex systems that change introduces new risks.  Like all nonlinearities in complex systems, purges can have unintended consequences.  The Praetorian Guard killed Roman Emperor Caligula and replaced him with the one relative he hadn’t purged, Claudius, because Caligula didn’t view him as a threat.  Furthermore, who would have picked the son of an imprisoned “enemy of the revolution,” Xi Zhongxun, who was thought by many of his peers to be a third-rate leader, to ascend to the Presidency of China and overturn its term limits?

Debt crises, defaults and hyperinflations

After a decade of poor growth and historically low interest rates, many of the world’s economies grew overly indebted.  As I discussed in Debt reality versus perceptions, while advanced economies’ debt problems are well known, those in emerging markets are underappreciated. The shift from outsourced globalization to Localization has undermined their potential growth rates but many built up high debts in anticipation of better times ahead.  The combination with rising real interest rates creates unsustainable debt dynamics for both the government and broader national debts of many EM.  Among the most worrying the dynamics of Brazil, Colombia, Egypt, and Turkey.  As noted in Debt reality versus perceptions, all of these countries likely will face a decision to default or hyperinflate, even without a crisis.  But amid widespread geopolitical disorder, the process is likely to be hastened by a rise in risk premia as global risk tolerance plunges.

How to prepare your portfolio

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Appendix: Construction of cultural values distances and subindices

Analysis of cultural values distances from various poles (China, Russia, and Western and “Other” centers) were constructed as follows.  First, demographically weighted within “center” average responses to each question were calculated as:

where r is the response to question q from individual i, whose demographic weight is w, within “center” C, and C represents either China or Russia individually, or the collection of countries in the West (Australia, Canada, Germany, the Netherlands, New Zealand, the UK, and US) or Other (all other surveyed countries).

Next, distances from those centers were calculated as the average across all questions within the question subgroup of the demographically weighted absolute difference of individuals responses from corresponding center values, i.e.:

where d is the distance of country j from center C based on each individual i’s response to question q with the subgroup of questions Q and demographically weighted by w.

For all but seven of the 259 survey questions, numerical averages could be computed as answers were binary (yes/no = 1/0), or given on a numerical scale (e.g. 0-9).  Missing, non-answers or “I don’t know,” recorded in the WVS dataset as negative values, were ignored.  For questions 152-157, the four possible responses do not correspond to a gradient – e.g. “a high level of economic growth,” “making sure this country has strong defence forces,” et cetera – and thus each response was treated as an individual question and quantified as the share of respondents giving that answer.

The question subcategories were defined as follows based on the question list in Wave 7 of the World Values Survey:

Overall distance: All 259 questions (with questions 152-157 split into four separate questions as noted above).

Subindices:

Family: Questions 1, 27, 37, 38, 184, and 185.

Women: Questions 28-33, 35, and 249.

Sex: Questions 22, 25, 36, 182, 183, 186, and 193.

Religion: Questions 6, 15, 23, 64, 94, 160, 161, 164, 169-175, and 242.

Environment: Questions 79, 99 and 111.

Tolerance: Questions 12, 16, 19, 21, 26, 34, 62, 63, 80, 81, 101, 104, and 121-130.

Freedom: Questions 2, 3, 8, 11, 41, 48, and 103.

Survival: Questions 50, 51, 54-56, 142, and 143.

Safety: Questions 52, 131-141, 144-148, and 150.

Health: Questions 47 and 53.

Subcategories:

Personal values: Based on the questions in the Family, Women, Sex, and Religion subindices.

Quasi-ESG: Based on the questions in the Environment, Tolerance and Freedom subindices.

Basic needs: Based on the questions in the Survival, Safety and Health subindices.

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1. “Three Questions: Knight time for vol,” Marvin Barth, Barclays Macro Research, 24 February 2020 (available to subscribers by request).

2. On the importance of socio-political myths to human organization, see Sapiens, a Brief History of Humankind, Yuval Noah Harari, Random House, 2014.

3. “The End of History?” Francis Fukuyama, The National Interest, no. 16 (Summer 1989): pp. 3-18.

4. “Democracy of convenience, not of choice: why is Eastern Europe different,” Branko Milanović, Global Inequality Blog, December 23, 2017.

5. Interview on NBC-TV “The Today Show” with Matt Lauer,, transcript, US Department of State,19 February 1998.

6. The Hell of Good Intentions, Stephen M. Walt, MacMillan, 2018.

7. See: “Drone Warfare,” The Bureau of Investigative Journalism, website; “The Assassination Complex,” Jeremy Scahill, The Intercept, 15 October 2015; and “The Operation that Took Out Bin Laden,” Kris Osborn & Ho Lin, Military.com.

8. “How do Global South politics of non-alignment and solidarity explain South Africa’s position on Ukraine?” Elizabeth Sidiropoulos, Brookings Institute, 2 August 2022.

9. “China Is the Top Trading Partner to More Than 120 Countries,” Amb. Mark A. Green, Stubborn Things, A blog of the Wilson Center, 17 January 2023.

10. “The influence mechanism of industrial policies on Chinese companies’ cross-border M&A decision-making,” Yalan Shen, Menggi Yang, Hongyu An, and Kailun Li, Scientific Reports, no.13, article 16162, 27 September 2023.

11. Survey of Chinese Espionage in the United States Since 2000, Center for Strategic & International Studies.

12. The Critical Technology Tracker, Australian Strategic Policy Institute, 22 September 2023.

13. See: “China’s Public Diplomacy Operations: Understanding Engagement and Inauthentic Amplification of PRC Diplomats on Facebook and Twitter,” Marcel Schliebs, Hannah Bailey, Jonathan Bright, & Philip N. Howard, Oxford Internet Institute, May 2021; “Chinese Bots Inundate Twitter With Pornographic Spam Amid COVID Protests,” Abid Rahman & Patrick Brzeski, The Hollywood Reporter, 28 November 2022; “How China Built a Twitter Propaganda Machine Then Let It Loose on Coronavirus,” Jeff Kao & Mia Shuang Li, ProPublica, 26 March 2020; and “Chinese bots targeted Trudeau and others - Canada,” BBC, 24 October 2023.

14. There are several translations of the book to English, but an abridged version made available by the US Foreign Broadcast Information Service is available free online.

15. See: “Unrestricted Warfare: A Chinese Doctrine for Future Warfare?” John A. Van Messel, Marine Corps University School of Advanced Warfighting, 1 January 2005; “Unrestricted Warfare is Not China’s Master Plan,” Josh Baughman, China Aerospace Studies Institute, Air University, 25 April 2022; and “Book Review: Unrestricted Warfare,” Major Marshall Lawrence, Australian Army Research Centre, 28 August 2020.

16. “China’s ‘Three Warfares’ in Perspective,” Peter Mattis, War on the Rocks, 30 January 2018.

17. “Qiao Liang: The U.S.’s Strategy of Shifting Focus to the East and China’s Strategy of Going to the West – China’s Strategic Choice in the Game between China and the U.S.,” Major General Qiao Liang, speech (translation), 15 April 2015.

18. The Dragons and the Snakes, David Kilcullen, Chapter 6, Oxford Academic Press, 2020.  Full disclosure: Dr. Kilcullen is a friend and business partner in another venture, but this book is essential reading for anyone interested great power competition and the challenges now facing the West.

19. See: “Russia and China Look at the Future of War,” Institute for the Study of War, 14 September 2023; “Hybrid Warriors: China’s Unmanned, Guerrilla-Style Warfare in Asia’s Littorals,” Tobias Burgers & Scott N. Romaniuk, The Diplomat, 16 February 2017; and “The long history of Russian deaths in the UK under mysterious circumstances,” Lucy Pasha-Robinson, The Independent, 6 March 2018.

20. See “The most shocking intel leak reveals new Chinese military advances,” Josh Rogin, The Washington Post, 13 April 2023; and “Top U.S. general confirms ‘very concerning’ Chinese hypersonic weapons,” Phil Steward, Reuters, 28 October 2021.

21. “Fifth generation fighter jets — A Chinese, Russian, Indian and US arms race,” MiGFlug, undated.

22. “Iran’s drones are a buzzing menace for Saudi Arabia,” Ilan Zalayat, Atlantic Council, 28 October 2021.

23. See: “The Air and Missile War in Nagorno-Karabakh: Lessons for the Future of Strike and Defense,” Shaan Shaikh & Wes Rumbaugh, Center for Strategic & International Studies, 8 December 2020; and “Loitering Munitions Will Change Warfare — Until Air Defense Catches Up,” Larry Dickerson, Defense and Security Monitor, 24 April 2023.

24. “On the ‘Gerasimov Doctrine’: Why the West Fails to Beat Russia to the Punch,” Ofer Fridman, National Defense University Press PRISM, vol. 8, no.2, 4 October 2019.

25. “Russia’s ‘Hybrid Aggression’ against Georgia: The Us of Local and External Tools,” Natia Seskuria, Center for Strategic & International Studies, 21 September 2021.

26. “Watch Out for Little Green Men,” Steven Pifer, Brookings Institute, 7 July 2014.

27. See: “Facebook says it sold $100,000 in ads to fake Russian accounts during presidential election,” ABC News, 7 September 2017; and “Why Russia’s Facebook ad campaign wasn’t such a success,” Patrick Ruffini, The Washington Post, 3 November 2017.

28. “2007 Chinese Anti-Satellite Test Fact Sheet,” Brian Weeden, Secure World Foundation, 23 November 2010.

29. See: “China’s Island Building in the South China Sea: Damage to the Marine Environment, Implications, and International Law,” U.S.-China Economic and Security Review Commission, 12 April 2016; and “China has fully militarized three islands in South China Sea, US admiral says,” Associated Press/The Guardian, 21 March 2022.

30. “A history of the Syria chemical weapons ‘red line’,” Romain Houeix, France 24, 16 April 2018.

31. “Russia’s Strategic Success in Syria and the Future of Moscow’s Middle East Policy,” Anna Borshchevskaya, The Washington Institute for Near East Policy, 23 January 2022.

32. “AIIB — the Beginning of Economic Challenge to the U.S.” Sajjad Ashraf, China-US Focus, 14 July 2015.

33. Global Chinese Development Finance Dataset, Version 2.0, AidData — A Research Lab at William & Mary, September 2021.

34. See: “Weaponizing the Belt and Road Initiative,” Asia Society Policy Institute, 8 September 2020; “The Belt and Road Initiative: Economic Development for All or a Geopolitical Power Play?” Andrew G. Ross, Royal United Services Institute, 18 May 2020; and “China’s Massive Belt and Road Initiative,” James McBride, Noah, Berman & Andrew Chatzky, Council on Foreign Relations, 2 February 2023.

35. “Has Trump Become a Realist?” Stephen M. Walt, Foreign Policy, 17 April 2018.

36. “Proxy Wars and Spheres of Influence in Post-Isis Syria,” Raymond Hinnebush, Mediterranean Yearbook 2020, European Institute of the Mediterranean.

37. “Qasem Soleimani [sic]: US kills top Iranian general in Baghdad air strike,” staff, BBC, 3 January 2020.

38. See: “Military and Security Developments Involving the People’s Republic of China 2023,” Annual Report to Congress, US Department of Defense; “Given China’s A2/AD Capabilities, How Would the United States Defend Taiwan?” Major Daniel Burns, US Naval Institute Blog, 16 September 2022; and “Anti-Access Strategies in the Pacific: The United States and China,” Sam J. Tangredi, The US Army War College Quarterly: Parameters, vol. 49, no. 1, Spring/Summer 2019.

39. See: “The most shocking intel leak reveals new Chinese military advances,” Josh Rogin, The Washington Post, 13 April 2023; and “How Are China’s Land-based Conventional Missile Forces Evolving?” China Power, Center for Strategic & International Studies, 12 May 2021.

40. Ibid.  See also: “Indian Ocean rivalry: China’s naval maneuvers irk New Delhi,” Ken Moriyasu & Kiran Sharma, Nikkei Asia, 27 September 2022; “China’s Emerging Subsurface Presence in the Indian Ocean,” Prakash Panneerselvam, The Diplomat, 3 December 2022; and “China’s Growing Influence in Africa Seen in Arms Trade and Infrastructure Investment,” Gordon Lubold, The Wall Street Journal, 21 April 2022.

41. “Xi Jinping: ‘Time for China to take centre stage’,” BBC, 18 October 2017.

42. “Xi urged China military in 2020 to brace for war amid West’s decline,” Kyodo News, 24 July 2023.

43. “China halts high-level military dialogue with U.S., suspends other cooperation,” Reuters, 5 August 2022.

44. See: “China’s Recent ADIZ Violations Have Changed the Status Quo in the Taiwan Strait,” Ben Lewis, Council on Foreign Relations, 10 February 2023; and “China, Russia begin joint drills in Sea of Japan, Chinese state media report,” Reuters, 20 July 2023.

45. See: “South China Sea dispute: Huge Chinese ‘fishing fleet’ alarms Philippines,” BBC, 21 March 2021; and “Philippines says Chinese coastguard ‘intentionally’ collided with its boats,” Enrico Dela Cruz & Karen Lema, Reuters, 23 October 2023.

46. “Galwan Valley: China and India clash on freezing and inhospitable battlefield,” BBC, 17 June 2020.

47. Work Together to Build the Silk Road Economic Belt and The 21st Century Maritime Silk Road, Xi Jinping, President of the People’s Republic of China, welcoming speech to the Opening Ceremony of The Belt and Road Forum for International Cooperation, 14 May 2017.

48. Belt and Road Forum for International Cooperation, Vladimir Putin, keynote speech to the Opening Ceremony of The Belt and Road Forum for International Cooperation, 18 October 2023.

49. Remarks by President Biden on America’s Place in the World, President Joseph R. Biden, US State Department, 4 February 2021.

50. I am purposely ignoring President Biden’s reference to the pandemic as his speech was the only one of the three I reference that was given during the Covid pandemic.

51. Dominion, The Making of the Western Mind, Tom Holland, Little, Brown, London, 2019.

52. “Culture Wars,” Tom Holland & Dominic Sandbrook, The Rest Is History Podcast, Episode 46, 26 April 2021.

53. The European Union: Human Rights and the Fight Against Discrimination, UN Office of the High Commissioner for Human Rights, Pamphlet No. 14.

54. Ibid et: Human rights and democracy, Promoting and protecting human rights, European Union; Democracy, Human Rights, and Governance, US Agency for International Development; USAID Releases First-Ever LGBTQI+ Inclusive Development Policy, Office of Press Relations, US Agency for International Development, 2 August 2023; and Unites States UN Human Rights Council Candidate 2017-19 Pledge, US Department of State, 29 February 2016.

55. Protection and promotion of human rights, Human rights outside the EU, European Council.

56. World Bank Group Human Rights Report, UN Office of the High Commissioner for Human Rights.

57. “World Bank halts new loans to Uganda over anti-LGBTQ law,” Al Jazeera, 9 August 2023.

58. WVS Results By Country 2017-2022, World Values Survey, Wave 7 (2017-2022).

59. The WEIRDest People in the World, How the West Became Psychologically Peculiar and Particularly Prosperous, Joseph Henrich, Farrar, Straus and Giroux, 2020.

60. Modernization, Cultural Change and Democracy: The Human Development Sequence, Ronald Inglehart & Christian Welzel, Cambridge University Press, New York, 2005.

61. For instance, women’s rights and sexual rights are generally grouped together with racial and religious tolerance in the WVS methodology, yet as discussed — and as shown in Figure 3 — that grouping itself reflects Western bias, since most societies view women’s roles in society and sexual practices not as issues of tolerance, but personal values related to family and religion.  For instance, when asked whom of the following you would not like to have as neighbors, 89.1% of Zimbabweans responded to “homosexuals,” but only 5.3% responded to “people of a different religion,” 5.2% responded to “people of a different race,” and 4.9% responded to “immigrants/foreign workers.”

62. “History of the phrase ‘How many divisions has the Pope?’” Pascal Trégeur, Word Histories (website).

63. Battlefield maneuver that seamlessly incorporates multiple force elements, e.g.infantry, armor and air support.  For more detail see for instance: “Combined Arms Operations,” Maneuver Self Study Program, US Army Maneuver Center of Excellence, as updated 18 December 2018.

64. “Turkish President Recep Tayyip Erdoğan Warns of ‘War between the Cross and the Cresent’ following Austria’s Plan to Deport Imams,” MEMRI TV, #6620, 9 June 2018.

65. The Accidental Guerrilla, David Kilcullen, Oxford University Press, 15 April 2011.

66. “China’s Growing Influence in Africa Seen in Arms Trade and Infrastructure Investment,” Gordon Lubold, The Wall Street Journal, 21 April 2022.

67. “Homosexuality: The countries where it is illegal to be gay,” The Reality Check team, BBC News, 31 March 2023.

68. “As anti-gay sentiment grows, more LGBTQ+ people seek to flee Uganda,” Evelyne Musambi & Brian Inganga, Associated Press, 3 June 2023.

69. “Let the hammer fall on same sex unions,” Editorial Board, The Guardian (Nigeria), 8 September 2023.

70. The extent of Western blindness to its own bubble was well illustrated by the process of researching this article.  Regardless of the prompts used, search engines return either exclusively Western articles, or a preponderance of them when search prompts include requests to pull from named African newspapers.

71. “Uganda fights off pressure over anti-gay law,” Nelson Naturinda, Monitor, 28 October 2023.

72. See: “Kenya: Hundreds of believers protest LGBTQ association right,” Rédaction Africanews with AP, africanews, 6 October 2023; “Speaker Bagbin is ‘mad’…Over US Interference In ‘Anti-Gay Bill’,” Agnes Ansah, The Chronicle, 29 March 2023; “US of A, please, LGBTQ is the least of our problems, don’t make it the worst of our headaches!”Op-Ed, The Chronicle, 4 April 2023; ; and  “Growing number of anti-gay laws highlight Africa’s steady human rights regression,” Ottilia Anna Maunganidze & Chelsea Cohen, Daily Maverick, 27 September 2023.

73. See: “In Uganda, Iran president attacks West on LGBTQ rights,” The Citizen/AFP, 13 July 2023; and “While in Uganda, Iran’s President Praised Country’s Harsh Anti-LGBTQ Law,” Halima Athumani, Voice of America, 14 July 2023.

74. “Hidden Strings Attached? Chinese (Commercially Oriented) Foreign Aid and International Political Alignment,” Damian Raess, Wanlin Ren & Patrick Wagner, Foreign Policy Analysis, vol. 18, no. 3, July 2022.

75. Specifically, I included votes on resolutions 68/262 affirming Ukraine’s territorial integrity after the Crimea seizure; ES-11/1 deploring Russia’s 2022 invasion; ES-11/2 expressing grave concern over attacks on Ukrainian civilians; ES-11/3 suspending Russia’s membership on the UN Human Rights Council; ES-11/5 calling for war reparations from Russia to Ukraine under and international mechanism; and 77/229 condemning Russian aggressions and rejecting its annexation of Crimea.  The dependent variable in the regressions was the averag across those votes, where a “yes” vote has the value +1, a “no” vote -1, and an abstention or absence 0.  I excluded resolutions ES-11/4 and ES-11/6 as the sponsors of both artificially boosted votes in favor by making them affirmations of the UN charter itself, but inclusion makes no qualitative difference to the regression results.  It is interesting to note, however, that those resolutions received 5 and 7 “no” votes, respectively, and 45 abstentions or absences each.

76. AidData’s Global Chinese Development Finance Dataset, Version 2.0, AidData, College of William and Mary.

77. The coefficient on total annual aid of -22.489 implies that every 1% of recipient-country GDP in aid received decreases their likelihood of voting in favor of Ukraine/opposing Russia by 4.54%. The coefficient on cultural distance of -0.5702 implies that each unit of difference decreases the likelihood of votes in favor of Ukraine by 57.0%. Half a unit of distance, roughly that between the West and other European countries (on average) is thus 28.5%, or 6.28x the efficacy of each percentage point of GDP in aid.

78. The problem is likely one of regression multicolinearity, i.e. because the three types of aid are highly correlated, including all three in a single regression makes all of them less statistically significant given the overlap in their information content.  The same issue presents itself when I look at the effects of differing subcomponents of cultural values, as they, too are highly correlated.

79. See: “Human Rights in EU Development Policy,” Jan Wouters & Michal Ovádek, The European Union and Human Rights: Analysis, Cases, and Materials, Oxford Academic, 22 July 2021; and “Aid diversion and the impact of Development Assistance for Health in a decentralized health system,” Samuel Lordemus, University of Sheffield manuscript, SERPS 2018016, 2018.

80. “Assistance with Fewer Strings Attached,” Vivien Collingwood, Cambridge University Press, 28 September 2012.

81. “Emerging Narratives and the Future of Multilateralism,” Amrita Narlikar, Chapter 1 (pp. 12-24) in Raisina Files 2021, Samir Saran & Preeti Lourdes John, eds., Observer Research Foundation.

82. As added irony, given the examples of the prior section, President Trump was the first US president to appoint an openly gay cabinet member, Ambassador Richard Grenell, who as acting Director of National Intelligence made decriminalization of homosexuality a key plank in the Trump Administration’s foreign policy.  See: “The historic LGBT Trump appointment that got overshadowed,” James Kirchick, Brookings Institute, 6 March 2020; and “Acting intelligence head Richard Grenell’s push to decriminalize homosexuality has yielded little,” Tim Fitzsimmons, NBC News, 21 February 2020.

83. The Reagan administration, the Cold War, and the transition to democracy promotion, Robert Pee & William Schmidli, editors, Palgrave Macmillan, 2019; and Reagan Presidency: Seven Years of Accomplishment 1981-1988 Master, Folder, Box: 61, The Ronald Reagan Presidential Library.

84. This is not entirely accurate.  The regressions of Model 1 were done on the overall cultural distance (the 259-question WVS distance) whereas Figure 5 shows the distance from two subcategories of values.  However, as noted in footnote 79 there is a high degree of multicollinearity between the overall and subcategory distance measures, and alternative specifications of Model 1 with both the Personal values and quasi-ESG values yield similar statistical significance with coefficient values that are roughly half that of the overall distance measure, i.e. their sum — shown by the distance on Figure 5 — is roughly equal to that of overall cultural distance.

85. Conceptually, think of the center of the green-dash circle in Figure 1, the Inglehart-Welzel map.  It’s not mathematically correct, but it conveys the idea.

86. “Weaponized Interdependence: How Global Economic Networks Shape State Coercion,” Henry Farrell & Abraham L. Newman, International Security, vol. 44, no. 1, Summer 2019.

87. “Middle-Income Trap,” Breda Griffith, in Frontiers in Development Policy, A Primer on Emerging Issues, World Bank, pp. 39-43, 1 February 2013.

88. “Complexity cascades (Parts I-III),” Marvin Barth, Barclays Macro Research, 9, 11 and 25 June 2020 (available to subscribers by request).

89. “How Complex Systems Fail,” Richard I. Cook, Cognitive Technology Labratory, University of Chicago, online manuscript, 1998, updated 2002.

90. “Putin ally warns 'enemy' Poland: you risk losing your statehood,” Reuters, 2 November 2023.

91. “All Members shall refrain in their international relations from the threat or use of force against the territorial integrity or political independence of any state, or in any other manner inconsistent with the Purposes of the United Nations.” — Chapter I, Article 2, §4, United Nations Charter.

92. See: “China fires missing defense minister, two months after he disappeared,” Claudia Chiappa, Politico, 24 October 2023; “The Mystery of the Disappearing Chinese Officials,” Jim Geraghty, The National Review, 26 October 2023; and “The political factors behind China’s disappearing leaders,” Mark Parker Young, New Atlanticist, Atlantic Council, 20 October 2023.

93. “Chinese censors clamp down on public mourning for former premier,” Gigi Lee, Siyan Cheung, Hwang Chun-mei, & Gu Ting, Radio Free Asia, 27 October 2023.

94. “Exclusive: U.S. probe of Saudi oil attack shows it came from north - report,” Humeyra Pamuk, Reuters, 19 December 2019; and “Iran Helped Plot Attack on Israel Over Several Weeks,” Summer Said, Benoit Faucon, & Stephen Kalin, The Wall Street Journal, 8 October 2023.

95. See: “The Science behind My Forecast for 2020,” Peter Turchin, Cliodynamica blog, 15 June 2020; Ages of Discord, Peter Turchin, Beresta Books, 2016; and End Times, Elites, Counter-Elites and the Path of Political Disintegration, Peter Turchin, Penguin Random House, 2023.

96. See: “The Threat of Civil Breakdown Is Real,” Steven Simon & Jonathan Stevenson, Politico Magazine, 21 April 2023; “Home of the hateful, fearful, heavily armed,” David Kilcullen, The Australian, 30 May 2020; and “What if California seceded from the US?” Rachel Nuwer, BBC, 9 April 2019.