Global risk analyst Ian Bremmer took the stage at CME Group’s 10th annual Global Financial Leadership Conference in Naples, Fla., on Monday to give his views on the uncertainty of worldwide geopolitical structures. Bremmer was joined later by J.D. Vance, author of award-winning book Hillbilly Elegy in a panel discussion titled Bridging the Gap of Inequality - Where Do We Go From Here?.
During his talk titled Geopolitical Outlook: Globalism, Populism and the Wave to Come, Bremmer, the president and founder of the Eurasia Group, spoke to a couple key points: international volatility and the rise of China vis-a-vis the decline of American leadership on the global stage.
On international volatility, Bremmer said the geopolitical situation is as unstable as it has been in decades. Bremmer’s talk highlighted the rise of China, referencing both the decline of the United States as well as China purposefully stepping forward. Where the United States has created a global leadership vacuum, it is coupled with Chinese President Xi Jinping’s push to have China take a leading role.
Bremmer referenced earlier in the week when he attended the Asia-Pacific Economic Cooperation (APEC) in DaNang, Vietnam, where countless attendees repeatedly highlighted Xi’s 19th Party Congress speech. Bremmer rates Xi’s speech as the second-most important geopolitical speech in in decades (with Mikhail Gorbachev being tops) because Xi effectively stated that since there is no global leader thanks to the policies of US President Donald Trump, then China is ready to be the world’s leader right now.
Bremmer continued his thoughts around China’s ability to fill the void left by the United States. He reminded the GFLC audience multiple times of the decades-old thought in the West that China needs to reform towards Western democracy, “but that’s not true” (at least in the near term). He continued, “if the world is no longer a free market, but a hybrid market, then the future of the global marketplace has changed fundamentally,” even though China’s GDP is only 60% of United States’ right now.
The last point on the rise of China is tied to the ubiquity of the smartphone and its ability to control humans. While in the US mobile phone content is created by private institutions that make for better consumers, Bremmer argued that in China, that same content is created by the PRC government and therefore can inculcate the masses towards pro-China, nationalistic ideals. In an interesting turn, Bremmer highlighted that to Chinese social elites, the US is still number one. “If you’re in the 1% of China, you want to be in the States. You don’t want to be in China.” The rise of China is tied to the rise of the rest of its billion citizens, not elites.
In the panel discussion, moderator Gillian Tett of the Financial Times asked whether populism has yet peaked in America. Vance said due to a lack of social trust he would say no, while Bremmer said the jury is still out. On Trump’s re-election chances, Bremmer said there is a 50-50 chance while Vance was more pessimistic, giving Trump only a 40% chance. No matter the odds of a single candidate, however, Vance said he believes there is the “broad trend will bend towards populism. I think we are in 10 to 20 years of instability now.”
Tett questioned both panelists about whether the US has entered (or was entering) a crisis period, but neither agreed. Bremmer said the issue of inequality in the US is not a crisis, but rather a chronic condition. The near-term answer, per Bremmer, will be disenfranchisement; the major problems will just continue to be kept down. Vance took another approach, stating “I don’t think the U.S. is especially stable right now,” citing higher mortality rates, opioid overprescription, and other factors. This led Vance to ask, “if these aren’t solved, what does Trump 2.0 look like 10 years down the road?”