The Unraveling: How Trump's Iran War Exposed the Empire's Hollow Core | Silk and Steel

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Hello and welcome to another episode of the Silk and Steel Podcast.

I am your host, Carlos.

Today we have back on our show, our regular guest, Dr. Worrick Powell from Australia.

Welcome back to the show, Worrick.

We have a lot to discuss.

You know, things have been getting really busy lately.

It's only been two weeks since we talked, but it seems.

It feels like a year has gone past already.

Really, I have noticed what's been going on.

It's a crazy world at the moment, isn't it, Carl?

And I remember what, a couple of days after we last spoke, I was at a lunch on a Saturday,

and the lunch topic turned to Iran.

And the question was, you know, who thinks that there's going to be something happening there?

And I said it's inevitable.

Anyway, by that evening, of course, the attacks had begun and what I think

for Donald Trump, Pete Hegseth and, you know, the central core of the American

political administration thought was going to be a Wambam.

Thank you, ma'am.

In and out, teaching all the lesson, fix the problem,

activity has turned into a problem that in many ways embodies the

decline of the empire, and in a way that I'm not sure the empire has a way out.

That's dangerous, by the way, you know, when the empire has gotten no way out,

because the empire still has a lot of things to throw around.

What are you reckon?

Well, I mean, obviously this was done with minimal planning and foresight.

You know, this has been experts for years and have warned that going to work against Iran

is a terrible idea.

And in fact, even the past seven US presidents have resisted pressure

to go to war against Iran.

And now we have Trump doing it, you know, makes you think,

what is in those Epstein files that haven't released yet?

That was so horrible that they must launch this war.

You know, the color epic fury, I mean, that's not co-incidence, you know.

So that is so when you type in Trump and EP in Google search engine,

you will not show up Trump Epstein first.

You know, they're trying to literally trying to game the search engine right now by launching a war.

And we know they have no launch, they didn't do planning because US is very quickly running

to the same problem of low ammunition, particularly standoff munitions and missile interceptors.

That was a problem during the 12 days war last year and nothing has changed.

And on top of that, US has been drawing down its strategic petroleum reserve.

You know, back, you know, back in Biden stays.

Trump, prior to start this war, he didn't even bother to fill up the US strategic oil reserve.

So by all indications, yes, they thought this is going to be a cookie.

You know, he has some really bad advisors, give him some really bad advice.

I think also the whole Venezuelan operation have given them,

you know, got them to their heads.

They got a little bit overconfident.

They thought, okay, we'll do the same thing with Iran.

We'll do a decapitation strike against their senior leadership.

And the rest of the Iranian government will fall into line.

Well, that's not what happened.

You know, Iran is actually a regional power in the show.

He has demonstrated, he has capacity to inflict a lot of damage,

you know, to the US bases all around the region.

And, and even worse than that is, you know, the whole US Empire Alliance system in

West Asia rests on the premise that the United States offers a security and

act them from the big bad Iran, but also to protect them from their own people.

Well, that all those premises are gone up in smokes right now.

And as US bases counter under Iranian attack and there's nothing US could do to protect them,

much less to protect their so-called allies.

All the Gulf countries are complaining about the completion of their own missile interceptors

and US just say, oh, sorry, it can't help you.

Because we need to hoard all the resources to protect our golden boy Israel.

And that's what happened which was reported in South Korea.

Now they're dismantling the fat system, the fat anti-missile system that was put in

placing Korea to, you know, versus China.

Now they're dismantling them to ship them to West Asia.

You know, it turns out the pivot to Asia did happen.

It's just a pivot to West Asia.

And it's a full-on retreat in the West Pacific.

Yeah, it's quite remarkable because it's one of the biggest on goals.

I think you could actually ever, you know, see anybody make.

It exposed a system, a production system and a supply chain system that

was clearly run down and has troubles keeping up.

That's one thing.

But it also, I think as you say, it was not only a lack of planning,

but the kind of planning that went in had a very particular character.

And it is this idea that America could secure whatever it wanted to

through a quick heavy intervention.

And this is kind of the pattern that has existed in American warfare for a long time because

the American system has been built around this idea of having enough in the arsenal to do heavy hits.

Expand that relatively quickly, but overwhelm the opponent,

get what you want, and then spend the next period of time replenishing again,

and then, you know, continuing your escapades around the world.

And it tried to do the same again.

And I think that there's this very deeply baked in mentality that

the US is strong enough to be able to just do things quickly and force the other parties hand.

And when that doesn't happen, it actually is left totally exposed.

It's arsenal, of course, as you say, is seriously exposed.

But so too is its entire supporting infrastructure.

When it is the long way from home, as it is, it needs to have platforms and infrastructure

either by having bases in a region or, of course, having floating bases.

And the bases that it had in the region have now been totally decimated.

Now, that, in fact, I think is the most significant outcome of this war so far

that the Americans did not actually have the ability to defend their most significant

regional assets. And their regional assets was actually the bases, because without that,

suddenly, you're having to approach Iran from a lot further away.

You don't have the refueling capabilities near a hand.

And so your rhythms and your cadence changes.

You're not in a position to deliver as many sorties over a period of a given time,

as you once were, because you now need to refuel.

You've got to come from further away.

And once this physical infrastructure is destroyed,

whether or not the United States will ever be back in the Gulf, I think it's going to be the

big question. I mean, the other question is the unthinkable question, which is the extent to which

sections of the American political system and sections of the Israeli political system

will respond as victory becomes more of a fantasy and the reality of the fate becomes more

obvious. But assuming that the non-crazy's prevailed and that we don't catalyze a nuclear conflict

of one sort or another, the question that I have in mind is, how will the Americans be able to

get their foot back in the region? Will the Gulf monarchies, for instance, once again be

welcome in open arms? I doubt it. The days of the petrodollar are over.

And Gulf monarchies, I think, are, whilst they're treading both sides of the fence a bit,

no doubt through back channels, trying to find ways of reducing themselves as targets.

And perhaps opening up a pathway to a post-US future in the region.

Obviously not going so well at the moment, but I can't imagine a set of Gulf monarchies

not doing that in the name of self-preservation.

Yeah, exactly. And there's already talks about the Gulf countries' meeting to discuss to

scale back their prior financial commitment to United States, on the pretext that they did

that fund to reinvest in their own country for rebuilding after the war. So forget about hundreds

of billions of dollars they need to continue to funnel into the AI bubble in United States,

because those money are not coming. Because the Gulf countries, their own economy is

reeling right now. They depend on continue to sell their oil and gas asset and the

straight-of-hormose is being closed. And they also dependent on food import from the rest of the

world. So the longer that the war drag on, the worse it gets for them. And the thing is they now

realize they have zero say in terms of US power and policy in the region. Because, you know,

US, when they head this war, without consulting them apparently. And they're the ones who have to

bear the consequences. This is what South Korea is finding out. South Korea has when, you know,

spend a lot of political capital burn their bridge with China when they first allow United States

to deploy that system on their soil. And now, without any consultation, US just decide, you know,

what we need to protect our golden boy Israel? That is our top priority. That is who we prioritize.

You are much lower on the food chain. You know, we don't really care about you. And another thing

for the so-called US partner and ally East Asia is to realize, you know, look at what you're

wrong is doing right now in the Gulf hitting all the US bases hosted by in the Gulf countries.

That could be you if a war to break out in over Taiwan between US and China. All the US bases

in the Western Pacific will go up in smokes. And, you know, US will not be able to protect you.

China has magnitude more missiles and much more advanced missiles than Iran. And right now,

US is scrambling to protect its own assets in the Gulf. They have about total of 11

fat systems. And Iranians managed to took out three or four radars for those fat systems.

And without radars, those fat systems, those billion dollar fat launchers are useless because

they're blind, totally blind. They don't know what to shoot. And yeah.

It raises some very interesting sort of second order questions, doesn't it? Because obviously,

as you mentioned, the blockage of the Strait of Hormuz obviously stops the flow of oil and gas out,

which is the first order question. The second order question though, or there's a series of

second order questions or implications, I think, that are worth thinking through. Firstly,

it's actually what happens to the production systems themselves. Many of the upstream systems

in Iraq, for example, ones that basically have water pumped in at one end to create the pressure

to push the oil out the other. Now, if you stop that from happening, the effects that that has

on the wells is quite dramatic. From what I've read, looking at the engineers who are responsible

for these sorts of systems, the risk to continuity should you actually put a cap on these

is huge. You might not actually get some of these wells going again.

Now, the reason why that could become a problem is because the storage is starting to fill up.

So as storage fills up, you're still producing. So as you go upstream,

the decision is going to need to be made. What do you do? I've got no more storage capacity

and nothing's moving through the Strait of Hormuz. Do I burn off gas and just keep the system going

and just burn it off and do I dump the oil into the environment and keep again the pumps going.

And the decision to do that may make some sense if it was a short term or the expectation was that

the Straits would only be shut for a short period a few weeks. You know, you'll do that for a few

weeks and then you'll be ready to keep going again. But if the Straits stay blocked substantially for

much longer than that, the ecological effects and the economic costs of maintaining the operations

of these upstream systems will begin to weigh heavily. You can't keep running them.

So decisions will begin to be made to curtail production and eventually shut things down,

knowing that once you shut them down, a lot of them won't get started again.

So that's number one second order problem. Number two second order problem is that oil is actually

the basis of a whole range of other industrial byproducts through its process of manufacturing

and refining. One of them is sulphur and once you constrain the global supply of sulphur,

you now need to think about what that gets used for and that gets used for lots of different things.

We also have the issue of the fertilizers that are made from the gas that ammonia then becomes

urea and we know that about 40% of the world's urea comes through the strait of full moves.

So that's going to have a very significant downstream impact on global food systems.

But the sulphur one I think is very interesting because it affects all sorts of other production

systems that make lots of other different things, things like copper. Without sulphur,

a gas and you're not making copper and if you're not making enough copper in the world,

then there are going to be activities that depend upon copper that will become more expensive

or constrained. One of those activities of course is the augmentation of electricity distribution

networks in response to demands from artificial intelligence data centers.

If that happens, the cost of grid expansion in the United States will rise even more.

The cost of electricity of course will rise as a consequence. Data centers in the short term

will pay that. But think of what the consequences are to everyone else who is dependent upon those

electricity grids for electricity. As the electricity price goes up, there'll be industries that

will have to shut down because they operate on very, very thin margins. Households will be confronted

with rising electricity costs. So not only have we got a first order oil shock, you've actually got

an infrastructure shock as a result of the byproducts from oil processing. Obviously we also have

things like impacts on diesel, but also things like plastics that are used in all sorts of other

products. These second and third order effects are very wide, incredibly wide and just talking

about some of these just touches the surface and if we only think about the electricity system

impacts in America, they're significant. Obviously we've got the gas station impacts in terms of gas

prices. I mean we've seen pictures no doubt you and your viewers have seen pictures all across

social media from different states where prices are anywhere from what three dollars to eight dollars

a gallon. Already and yet only what a few weeks ago at the state of the union address,

President Trump talked about low gas prices as evidence of the administration's economic prowess.

He promised in 2024 that gas prices under a Trump administration would be $2 a gallon.

Right. But these pressures will start to build in the system. We're going to have industries that

are obviously oil dependent which all fill the pinch. We'll then have industries that have

dependent on the byproducts and the things that get made from the byproducts of the oil system

that will then start to fill the pinch. And these things, these effects won't be felt for three

months, six months or sometimes 12 months. But they're already baked in car. It doesn't matter

what happens. If tomorrow the straights of commercials open down, the past dependency that has been

shifted by virtue of this last 10 days or so has already baked in some of these consequences.

If this goes on for another two weeks, three weeks or six months, we're going to see

massive systemic shocks and adjustments in ways that I don't think anybody of this current younger

generation, anybody born from the late 60s onwards will actually have a living memory of because

the last major shock was of course in the 1970s. So, you know, we have the financial system shocks,

but this is going to be a shock in a very different way, because it will cause a whole bunch of

economic activities to no longer be possible, not because they're financially unviable, but because

they don't have the material inputs anymore. On the other hand, you've got a place like China,

so it keeps the people talk about this conflict as this is an attack on China. Well, if China

was incredibly dependent upon Iranian oil, sure, that would be a logical conclusion to reach,

but in fact, China isn't that dependent on Iranian oil. Chinese economy will be impacted,

of course, like everybody, but the Chinese economic system, as it's growing, has also seen a much

significant diversification of its energetic systems. It's far more electrified today than it's ever

been. It reached peak diesel in 2024, and so the extent to which the system as a whole is affected

by the strength of hormones is actually far less than a lot of people would think. It's certainly

less than what it was 10 years ago, and 10 years ago it was bigger, of course, 20 years ago,

as quite significant. And so the Chinese system by virtue of intensively

last 15 years is far better placed to deal with this than anyone else, because it can actually come

out the other end by a quicker. The other interesting thing, which all of this sort of reminds me of,

you know, and I think we've talked about this on and off, in the mainstream western commentary on

the Chinese economic model. There's a whole lot of talk of our wasteful investment,

excessive investment, excessive capacity. And EVs and high-speed rail have been two examples

that are often put up there, as cases in point. Well, I tell you what, right now,

in the wake of the closure of the Straits of Formals, I'd rather have a transport system

that was intensely electrified than one that wasn't. I'd rather have a rail network

that was electrified rather than one that wasn't. And I'd rather have a domestic patindia and cargo

transport system that is increasingly electrified than one that wasn't. I'd also like to have

factory capacity to make me a lot more of these things, so that I can accelerate my move away

from oil and diesel dependency for transportation. And frankly, if I was anyone else in the world,

I would be beating a path to Chinese manufacturers trying to get to the front of the line,

to get as many electric cars as I possibly can, and electric trucks and other things,

because this shock is going to cause an acceleration of global demand for electrified

transportation, whether it's rail, road, or indeed shipping. And arguably, we would say

air transport as well, drones. So for all of those people who, for the last 15 years,

through stones of China, for its wasteful investment in electrification,

I don't think we'll hear an apology or a mere culprit from them, but anybody who is reading the

commentary now and sees these people poking their heads up, going on about wasteful investment,

et cetera, et cetera, could really remember that if the Chinese political elite and policy makers

paid any attention to them in the last 15 years, China itself would not be as well prepared

today for these sorts of shocks. I just saw the latest data. It says China exported about 1.5

million vehicles in the first two months of 2026. And I'm assuming a huge percentage of that

is EVs. And what just happened now is just only going to supercharge that process. You know,

Chinese EVs and Chinese solar panels, there will be a huge demand for them. And I'm so happy,

I'm so happy personally, I bought a Chinese EV last year. And so my next thing on my list is

put solar panels on my roof. So I can be energy independent. And this is something a lot of people

have to think about, especially people in the global south when their energy grid is not that

stable in any case. Now they will have other options. One thing China was able to do to help Cuba

is, as people know, Cuba is currently under a oil embargo by the United States. China has

supplied Cuba with a lot of solar panels that was able them to generate their own energy.

And that has helped Cuba a lot in this time of crisis. I mean, for many people that that will

increasingly be the preferable option. Absolutely. Renewable energy generation is quick to implement.

Throw in batteries with it. And you've got an ability to have distributed solutions. And again,

it's quick because you don't need lots of big grids. And of course, you can progressively build out

little micro grids. Micro grids are very, very useful because they enable load utilization across

the network of users. And it also helps with a bit of risk mitigation. So if somebody's got

a problem in one part of a community, it could be a factory that needs to boost its production

or something. Being in a micro grid can actually access a little bit more energy than it would

normally need. So micro grids, renewable energy, etc. is hugely important. And I think we're going

to see also at a much bigger scale renewed interest in other types of clean energies, you know,

whether it's nuclear or what-have-you-ride. But their big systems, they take a lot more time to

build, to design and build. You don't get lots of them popping up quickly. But in the meantime,

the sorts of things you've just described are going to become part and parcel, I think, of the global

development landscape. It's kind of funny. In a friend of mine, I would probably classify him as

a bit of a prepper. And of course, what we're seeing now is we're going to have a whole bunch of

normies, urban normies, who actually will become urban preppers, and all over the place.

But these are the sorts of systemic adjustments that we're going to start to say on file run.

And Cuba's a very, very interesting case in point. As Cuba's storage systems

improve, and the load equalization and spread over the course of a day is then better managed with

with batteries, it will actually become a much more stable situation as well. But these are the

systems that we're going to start to see unfold even more. I would also hazard a guess that

over the course of the next 10 years, assuming that there's no nuclear

event, which sort of makes these discussions a bit moot. But over the course of the next 10 years,

we're going to see three main things happening, I think, in the global energetic sense,

all under this umbrella of electrification. The first one as we've discussed is, I think,

a proliferation of clean renewable energy-based microgrids. We're also going to see in parts of the

world some of these bigger systems, mainly nuclear. So that'll be the next thing. Eventually,

we'll see in 40 years time things like fusion really play the central role, replacing the

renewable systems as they become obsolete. But the other thing that I think

were likely to see emerge is the scaling up and rolling out of a technology that we call

triboelectric nanogenerators, 10th, T, N, G, S. It's pretty geeky, right? But it's essentially

technologies that enable the capturing of energy from the natural environment

in very, very small amounts, and to make that available for devices at the very edges. So

application cases include things like very, very small sensors, such as sensors that are put in

water, which will naturally just replenish their own energy by capturing the energy from

the bobbing in the water. We'll see a lot more of these sensors being deployed where the breeze

itself will enable the capturing of the energy, which is enough to power the sensor and the

transmission of the data from the center. And this will enable a proliferation of distributed

information systems as well. And the reason I mentioned this is that I think it's also going to be

transformational. So the third order effect of these changes is that it will enable the transformation

of the global information architecture for 30, 40 years or so. The majority of global information

systems have been American, hardware and software, as well as the means by which information is

transmitted. That's going to change. And one of the reasons it's going to change amongst others

in the life of the risks that we're observing at the moment is that places that once could not

afford all of these big, expensive systems will actually have access to much low cost energy

efficient distributed energy enabled data collection and processing systems. And that's going

to happen over the next 10 years. So in some ways, the end of the petrodollar empire, so to speak,

which I think we're witnessing right now, is also the beginnings of a future in which a more

digital, a digital Westphalian architecture will emerge, where countries will be more energy

independent, will be more information systems independent. But nonetheless, be able to

operate with each other because of standard protocols and security agreements and those sorts of

things. And that's going to be a vastly different world to the world that we've become accustomed to

over the last 30 years, where the United States has controlled energy by virtue of controlling

these major energy regions. It's controlled the financial means of payment. And of course,

it's controlled the information architecture that's enabled all of this stuff to coordinate.

That's all changing.

Yeah, it's interesting because I saw a lot of throughout the course of wars. There's a lot of

copium and essentially war propaganda by produced by these conservative think tanks in the United

States. I saw article from Hutton Institute basically saying this is Trump playing five-dimensional

chess against China by controlling the energy supply, first going after Venezuela and Yorong.

And then that will have a huge leverage over China by the American control of these oil producing

regions. But nobody, I don't know who these days still believe that Trump is capable of playing

five-dimensional chess. And the idea that somehow this is going to damage China,

they need to look at what is doing to the economies of the so-called US allies in East Asia,

Korea and Japan both countries with Korea, Japan, Philippines, and also India as well. They

all heavily depend on the import of the Gulf oil. And they, in case of Korea and Japan, it's about

80 to 90%. Whereas China, they have other options. China's largest energy supplier is Russia

right next door. This is why now recently India have asked for a waiver so they could continue to

purchase Russian oil. And that's why Scott Besson talking about now they're thinking about

unsanctioned some of the other Russian oil. Because I think they realized they screwed up. They

screwed up that now they have to allow some of their so-called US partner countries to purchase

Russian oil to offset this going offline of the Gulf oil. Well, they need more oil in the market,

right? That this is the thing, but you're right. Look, Japan, Korea, the Philippines are facing

some very significant headwinds. Arguably, Japan has got a bit more of a runway because it does

have light reserves, but at some point they run out, but I think they've got reserves, but

Korea and the Philippines are really in the firing line. And the Philippines tried to diversify

to some degree successfully, but mainly to North American energy. And it's going to be,

I think, very severely affected. So not only is it going to be physical availability questions,

but obviously the price volatility that we've seen clearly marked manipulation.

But at some point reality will prevail and it'll push prices up quite high if the war continues.

And that's going to be, it'll be bone crushing for these small countries that have limited

foreign exchange reserves. And I think the other thing that we're going to seek out of all of this

is a continuation of the trend of supply chain shortening and localization. So within the Asia

Pacific region, for example, the China, of course, is the central trading partner for just about

everybody. It's the largest trading partner for Asian and vice versa. And that trend is going to

actually be consolidated because of all of this. The idea that you have long stringy supply chains

is one that you will seek to over time and as quickly as possible overcome by having the

most short as possible. You want to be mitigating your exposure to things like transport cost risks.

We're also going to see some other interesting things which is the acceleration of transport

infrastructure integration between China all the way down the Singapore through electrification.

And that's to move people. And when push comes to shove in the event that there are problems with

maritime traffic to be able to move goods as well. Obviously moving things by ship is more cost

effective, but it's a fantastic backup to have. And we're going to see a lot of these sorts of

redundancies emerge in Southeast Asia. We'll see electrification hastes right across

Southeast Asia as well. They'll want their own factories, of course, and those that can do that

will be trying to get their factories up and running as quickly as possible. But in almost all

cases, it involves deepening some connection to a Chinese electrification supply chain somewhere

or another, whether it's with an EV manufacturer or with the battery supply chain. One way or another,

this transformation that we're likely to see over the next five to ten years,

we'll see the regional supply chains actually tighten up and become more intertwined,

not less intertwined. And when you add that economic reality to what you mentioned earlier,

which is the fact that the American security umbrella that everybody had puddled under

proves to be a attempt and village security umbrella, then the big question will be asked

by all of these places. And in fact, I have no doubt in the corridors of power,

the little quiet checks, the question that no one ever asked before is being asked now,

which is, can we afford the Americans to be here much longer? And they know the answer.

So the question that probably isn't yet being asked in the open, but is already in the back of the

minds is, and what do we do when we ask them to leave? What are they going to do when we ask

them to leave? How are we going to handle this? And what happens in the vacuum? Because that's your

flip side, right? So in Asia, the vacuum is of course one that Japan would love to fill.

No one's going to let them do that. How that happens and how Japan is not allowed to do that,

is going to be a real test of the diplomatic skills of the region in containing that.

I'm hopeful, maybe not confident, but hopeful that with the passage of time that can actually be

managed, and Japan's ambitions to, in a sense, become a major military power in the region will

be curtailed, because no one wants it. But the issue of the Americans essentially having their

position in Asia diluted just as it's happening in West Asia will create a need for an alternative

set of arrangements. What those arrangements are, I think, is the question that people really

should be talking about and thinking about now, because that isn't going to appear out over

naive or fall from the sky, right? It's going to be something that will demand a lot of careful

consideration and a lot of dialogue Asian style. Yeah, actually, in fact, I even think the case

of Japan, I think the best chance for Japan's future is to integrate into the Chinese supply chain.

Because they still have some comparative advantages in some areas, like advanced to my

conductor, there are still some pockets of the words Japan excel. They could still make do

by making them part of the Chinese supply chain and share the prosperity that come with this.

So I'm actually surprised by the approach that was adopted by Japanese prime minister Sunai Takaiichi

by, you know, aligning itself even more closely with the United States, you know,

going down with a sinking ship essentially. I mean, it's very obvious for like outside

observer, the Japanese destiny is within East Asia. By integrating further with the East Asian

supply chain center in China, that's whole for Japan. Yeah, well, you know, the Chinese saying

is a pangwanese, and maybe that's Japan's dilemma at the moment. You know, those on the sidelines

can see things clearly, those in the middle of it though. And, but I think you're right,

you know, at a structural level, the future for Japan would be best served if industrially it

integrated into the broader Chinese supply chain network. If it also integrated into the Siberian

and that sort of northeast Asian energy agriculture network as well, because that's where energy

and food is going to come from for that part of the world. Same story goes for Korea. And I think

we've had this conversation before, but that's the logical, if you will, if you had a blank sheet

of paper and everyone had goodwill, and there was no sort of, you know, historical baggage and all

of that. And they said, these are the resource endowments. How do you think you can organize

yourself so that everyone gets on and has the best outcome? That's probably what it will look like.

So how do you get there from environment at the moment where the 100 Japanese administration

has sort of doubled down on some aspirations of becoming a new military power? It's done that

under the umbrella of American protection, which, as we have seen in the last couple of weeks,

is seriously endowed now. Not only did it not have the capacity to protect

the golden child, as you call it, it hasn't had the capacity of protected spaces, which of course

is central to its ability to protect the golden child. And it's run out of stuff. So now it's rating

East Asia of equipment, leaving East Asia exposed for what that's worth, because having a

FAD system in Korea quite clearly based on the experiences of what's happening in West Asia

clearly tells us that it wasn't going to do much. But the umbrella, the umbrella is really

a pigment of the imagination now, and that's all it is. Now, once that reality settles in,

and once strategic thinkers, defense thinkers, strategic analysts and others actually internalise

that in places like Tokyo, Seoul and Manila, then I think we'll start to see very different

conversations. I think you and I both know that intelligent people actually have the ability to

ensure things well before they begin to articulate them. And there are plenty of people across

this region who actually deep down just know how to articulate it, when to articulate it,

in a way that doesn't get themselves smacked down is the big question. And I think the same

issue is emerging also on the island of Taiwan, where all these think tankers keep talking about

how all of this is emboldening the mainland, etc, etc. I haven't heard so much

baloney for a long time. The mainland actually doesn't have to do anything different.

The big question that is the big dynamic that's going on is actually the recalibration of thinking

in Taipei. I mean, that's the rethink that's going on. And if they took a look at the

bases and the destroyed fads and everything else across the Middle East, the logical conclusion is

the civil war must end and the sooner it ends, the better. And it needs to end in a way that there's

no bloodshed lost. Deep down, people know this already. Some are articulating it. They get smacked

around a bit. But there are people there in the hierarchy who actually know that this is the

only way. It's just going to be a question of how and when.

That's exactly right. I mean, I also see a lot of commentator on social media say,

why don't China move on Taiwan right now? But look, for China, the Taiwan issue always

remain the top priority. But China will result the Taiwan issue on its own timetable. It's

kind of irrelevant what United States or the US Empire do elsewhere. And the top goal has always

been a peaceful unification. But China will not remove force from the

table of options, but they still prefer a peaceful unification. They're waiting for Taiwan

basically to ripen and fall into their lap. And the last thing China want to do is to risk

an unnecessary war. This is why a lot of the outside commentators don't understand. They think,

oh, this is the whole world is just like a risk board. The game will risk. Now will be the time

for China to go in to take Taiwan. It's like, why? China wants China's preferred method of

unification will be for Taiwan only to be reintegrated into the motherland. Not a forceful

unification that carry out on their force of threat. This is something I think people just

they talk about this because they have fundamentally have no skin in the game. The Chinese people

actually do have skin in the game. This is going to be their future. And so they're very careful

on how to go about it. And this is why I kind of just tune out when people

talk like that. Oh, just what China should do. And think of it like this. And this is what people

outside actually need to get into their minds to actually understand this. If military action

was taken, what that really means is that somebody is going to be shooting somebody's grandchildren

and great-grandchildren. That's what it means. That's why there is an incredible reluctance to do

this. There is a civil war. It's not concluded, but nobody wants to be in the business of

re-igniting something that involves the killing of somebody's grandchildren and great-grandchildren.

That's the first point. The second point and this really extends from your observations. And that is

if you reunify something under force, the likelihood is that you will also create

a level of resentment that will be harbored in sections of a population that will be a problem

for a long time. And we see this in other parts of the world too, where populations are divided

through sort of forceful divisions and joining and stuff like that. And I think the Chinese

government on the mainland is very mindful that if you don't have to, then why would you go

out of your way to create a thought in your side? It's already a thought in the side to the extent

that it hosts American military capability. So why would you go out of your way to

have the people become resentful? And I think we're starting to see a lot of change in attitudes

too, where obviously there's a recognition that the American protection umbrella is really

just a friction. That's the first thing. The second thing I think is becoming more evident is that

the idea of the mainland being the poor communists and we don't want to be the like the poor

communists. Well forget about that. They're the rich socialists and we want more of that. So that's

the second thing. And I think that there's one more thing in all of this, which again I think we've

touched on, but is emerging again stronger than ever before. And that is despite 20 odd years of

attempt to sanitize the Chinese heritage of people on the island. That there is a generation that

is rediscovering what it means to be Chinese. And that process is actually being accelerated

by all this stuff going on around because you're starting to hear people say, well, I'd rather be

protected by the PLA because I'll be safe. And that sense of transformation of public attitudes

in the widely articulated, I accept that and you'll find in almost every opinion poll,

you know, the idea that people just want the status quo. All the status quo is an easy one if you

have a very simplistic view about the status quo, which is my life can carry on and everything's

okay. But everyone knows that the status quo is fundamentally changing anyway. And so I suspect

that those in Beijing and the different folk involved in this, the question of the Taiwan issue

actually on both sides of the straits are starting to arrive at an implicit common understanding

that sometime in say the next 10 years, there will be very serious talks about how to put

all of that old stuff to bed and what the future looks like. And my instinct is that

the only issue of, you know, import that needs to be really dealt with is the status of the

Republic of China, militia. And that obviously would need to be disbanded and absorbed

that there is one foreign policy. But I suspect that once that's done, there's not much else that

will actually be on the table. They might actually need to have a few controls on how many people

from the island want to go to the mainland because I suspect that the direction of traffic will

probably be more that way anyway. I don't think there's even going to be that much resistance

about disbanding the military on Taiwan because not many Taiwanese youth are very eager to sign up

right now, you know, they have been to win votes. The ruling party on Taiwan had been shortening

the military service from two years to one year to six months. And now they're going back to one

year because Americans are pressuring them too. But it's, you know, most of the young people see

it's pointless why they have to spend a year away from family to go do the military service. So

if they get rid of that, I do not expect too much popular opposition on Taiwan.

Yeah, and look, you know, and the island itself obviously has a whole bunch of developmental issues

now. You know, the outside world thinks of Taiwan as this super advanced semiconductor manufacturer

on, but it's just one factory. In fact, the economy in many other respects is, you know, it obviously

industrialized early with a lot of external assistance, but it's nowhere near as advanced

as many of the more advanced parts of the mainland. And so, you know, infrastructure, we know this now,

you know, transport infrastructure, electricity infrastructure. And so those things will become

priorities. You know, when you, people talk about Taipei as equivalent to, you know, a medium-level

second tier city, you know, you know, you know, that, you know, there will be investments made

to, you know, raise the standard. And, and in fact, you know, if you were in the business of

orchestrating a reunification, part of that will be, of course, a substantial improvement in

the, in the public infrastructure of the island. You'd be crazy to not do that. So, yeah, look,

the situation in Iran is, it is like a Pandora's box, right? And it unleashes all sorts of

energy and forces in the world that have been dormant. They're not things that haven't existed,

but they're possibly not so dormant or a bit quieter. And they create spaces for stuff to

rip to emerge. They force new conversations to be had. They force the recognition of certain

realities that perhaps at a certain level, many people have. I kind of just wanted to just

deny for maybe another year or two, but it's brought it all forward. And here we are,

an American military industrial complex that overreached, that is now rating,

it's, it's, it's capabilities from everywhere else in the world. It's trapped in a war that

it can't win. It opened up the Pandora's box of having its energy pipeline got. And there is no

way out at the moment that would deliver to America something that you would call a face saver,

because everyone knows that even if a face saver was given that that would be the humiliation itself.

Well, given that Trump is a president, I mean, he will still try to spin as a victory anyway,

because that that man is shameless. So he will still claim total victory,

you know, total US domination. And then he will call admission accomplished. And then he will

demand a Nobel Peace Prize. I mean, I think that's most likely outcome. And no one in the world

is going to other than, you know, independent commentators. But now the government in the world is

going to say, that's nonsense, right? They're all going to nod, because they know that

there is nothing to be gained by saying, actually, that's all nonsense. You're living in a dream.

And that just much rather America become more normal. And if this is the kind of thing that you

need for America to become more normal, then they will be pragmatic and accept that, yes,

president. This has been, you know, it's exactly as you say, now you'll become normal. So

interesting time. So yeah, and it's only the third month of the year.

Anyway, this has been a very enlightening conversation. Thank you, Dr. Powell,

for always making the time to speak to us, to break things down in detail. If people are looking

forward to follow your work, where would they go? They should follow me at substackworickpal.substack.com

and I'll put in a quick little plug, but we can talk about this next time around.

I've got a book coming out on the 15th of March called,

SEMO, Economics, you know, Time of Monsters that will be out on Amazon. And I've experimented

with self-publishing this time because my academic publishing partners make books that are too

expensive for most people. So let's see how this goes. So if people are interested in some of these

topics in a more heavier scholarship kind of setting, there's a book coming up.

I look forward to that. And then it's very appropriate title given the time we're in.

Thank you again, Dr. Powell. And for my audience, thanks for tuning in until next time. Bye-bye.

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