“The essence of strategy is choosing what not to do.” – Michael Porter
A dramatic series of diplomatic events took place over the past several weeks that leaves little doubt: profound geopolitical change is afoot. We took note when Russian President Vladimir Putin rode in US President Donald Trump’s limousine in Anchorage, Alaska, during their hastily prepared summit in mid-August. Two weeks later in Tianjin, China, Putin hosted Indian Prime Minister Narendra Modi in his own limousine for a secret session that reportedly lasted about an hour. Kremlin spokesman Dmitry Peskov stated that the “home walls” of the limousine—presumably highly resistant to eavesdropping—underpinned the rationale for the chosen venue.
The momentous 2025 Shanghai Cooperation Organization (SCO) summit, followed by a spectacular heavy weapons military parade in Beijing to mark the 80th anniversary of the end of World War II, solidified the idea that a historic global power pivot is underway. The extraordinary presence of North Korea leader Kim Jong Un alongside Putin and China’s President Xi Jinping was a bold statement of Eurasian unity against Western hegemony—a force that any unbiased observer would have to admit is in steep decline. President Trump conceded as much in a remarkable post on Truth Social, where he stated, “Looks like we’ve lost India and Russia to deepest, darkest, China. May they have a long and prosperous future together!”
If history is any guide, legacy media is the last place one should look for the truth about what is actually occurring behind the scenes. Political insiders routinely obfuscate, misdirect, and outright lie to journalists who are more than happy to report things they know perfectly well aren’t true. The story exists because “sources” said it, too often with little attention paid to the veracity of what is being claimed. What Trump, Putin, and Modi discussed during those limousine rides is undoubtedly historic, but years will likely pass before their true nature becomes known—if it ever does.
As we described in last month’s Pro Tier presentation, “Lateral Thinking,” our approach to such uncertainty is to develop mental models based on axioms that need not necessarily be true, only plausible. As long as they trigger new and interesting ways to speculate about the problem, brainstorming around such axioms can lead to counterintuitive and useful insights. During a text exchange over the weekend with our friend Luke Gromen—author of the outstanding weekly newsletter Tree Rings and himself an excellent lateral thinker who is often years ahead of the legacy media—an interesting axiom was proposed:
What if the trade was for Venezuela?
Gromen’s speculative axiom neatly synthesizes several concepts we have been writing about for some time. In December of 2023, we published “The New World’s Oil,” highlighting the enormous oil and gas potential of the Western Hemisphere, particularly in Venezuela. On the very day in January that Trump was inaugurated for a second term, we released “Misreading the Room,” in which we speculated that the new administration would make regime change in Venezuela a top priority. Three weeks ago, we published “Blooming Flower,” to note how a critical mass of oil and gas supermajors had assembled in Venezuela’s neighborhood—a development that has historically foretold an unpleasant future for strongman dictators on the critical path of oil development.
The plausibility of such a shift got a boost last Friday, when Politico published a most interesting article:
“Pentagon officials are proposing the department prioritize protecting the homeland and Western Hemisphere, a striking reversal from the military’s yearslong mandate to focus on the threat from China. A draft of the newest National Defense Strategy, which landed on Defense Secretary Pete Hegseth’s desk last week, places domestic and regional missions above countering adversaries such as Beijing and Moscow, according to three people briefed on early versions of the report.
The move would mark a major shift from recent Democrat and Republican administrations, including President Donald Trump’s first term in office, when he referred to Beijing as America’s greatest rival. And it would likely inflame China hawks in both parties who view the country’s leadership as a danger to US security.”
Broadening the axiom further, what if the entire Western Hemisphere were deemed by the three superpowers to be firmly back within America’s sphere of influence, with China pulling back? True or not, pondering the question leads to some interesting predictions. Let’s suspend disbelief and take a tour of Central and South America.