The Peter Zeihan Podcast Series America’s Processing Crisis: Racing China's Decline || Peter Zeihan
May 30, 2025
The discussion dives into America's struggle with processing infrastructure, crucial for converting raw materials into intermediate products. It highlights how past administrations have faltered compared to China's ability to subsidize effectively. The urgency to enhance processing capabilities for re-industrialization is a key point, especially as China's systems begin to weaken. Understanding these dynamics is essential for revitalizing U.S. manufacturing and preparing for future challenges.
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US Processing Infrastructure Deficit
- The US lacks sufficient processing infrastructure to convert raw materials into intermediate products for manufacturing.
- China dominates this sector due to heavy subsidies and lax environmental regulations, which the US must catch up on urgently.
China's Market Control Strategy
- China cornered the processing market by heavily subsidizing industries and tolerating environmental damage.
- This strategy enabled China to outcompete processors worldwide, despite limited raw material access.
Build Domestic Processing Facilities
- Increase processing facilities across North America to enable manufacturing independence.
- Invest in domestic infrastructure now to replace lost Chinese subsidies and maintain industrial power.