Strategic Narcissism: The Emerging World Order (2025-2028). Democracy Under Water. And Meta’s Threat To Europe. #245

Special limited “things” edition...

Adrian Monck

Mar 13, 2025

Grüezi! Between New York and Stockholm this week, so forgive the format tweak…

🌐 Strategic Narcissism: Trump’s America turns inward, fracturing the Western alliance—friends become rivals, and Canada finds its Arctic sovereignty challenged not only by Russia and China but by the US itself.
🧊 Arctic Realpolitik: Washington’s back-channel Arctic deals with Moscow sideline Europe, confirming fears of an unraveling transatlantic unity and raising alarms from Ottawa to Copenhagen.
📍 The Post-Western Order: Welcome to the multipolar era—alliances splinter, middle powers hedge bets, and great power competition revives 19th-century power politics, reshaping the global chessboard.

1️⃣ Strategic Narcissism 2025-2028

An Emerging World Order

Old certainties are crumbling before our eyes. Canadian soldiers protecting the Arctic from Russia and China, find themselves with another power eagerly eyeing their territory – the US. A Guardian journalist with them reported:

Most soldiers duck the issue of tension with a longtime military ally. But some are blunt in their rejection of the idea. “We’re Canada. We’re not a state and we never will be,” says one.

Not only has America’s unipolar moment passed, but the very concept of “the West” as a coherent geopolitical bloc is disintegrating.

Donald Trump, labelled a narcissist by critics, is leading America into a world of “strategic narcissism” where even traditional allies increasingly pursue divergent paths.

2️⃣ The Fracturing of Western Unity

The most striking development is the collapse of transatlantic solidarity. America’s pivot to hemispheric dominance and selective great power deals has left European allies reeling.

Washington’s potential Arctic Bargain with Moscow would represent a breaking point – pursuit of a unilateral rapprochement with Russia that undermines decades of collective Western policy.

European capitals watch with dismay as America negotiates over their heads on Ukraine. For Eastern European NATO members, the spectre of a US-Russia accommodation revives historical nightmares of great power condominium. For Western Europeans, it confirms their worst fears about American unreliability.

America’s new hemispheric assertiveness has strained relations even with its closest neighbours:

Canada faces unprecedented pressure regarding Arctic sovereignty claims, with Washington essentially treating the Northwest Passage as American waters.
Greenland’s vast mineral resources have become a flashpoint, with the US demanding Danish authorities block all Chinese investment initiatives.
Panama, long a US client state, finds its economic relationship with Beijing under hostile scrutiny.

These hemispheric power plays reflect a fundamental shift in American grand strategy—from global leadership to regional dominance coupled with selective global engagement. The implications for traditional alliances are profound.

3️⃣ The Post-Western International Order

The very concept of “the West” as a unified bloc is becoming obsolete. On technology policy, Europe pursues digital sovereignty while America demands alignment with its China containment strategy. On trade, Washington embraces protectionism while Brussels clings to managed globalisation. On climate, the former Atlantic partners pursue increasingly divergent paths.

This fracturing extends to institutional architecture. NATO maintains outward coherence while within member states pursue contradictory policies. The G7 issues communiqués of diminishing relevance. “Western”-designed international financial institutions face competition from alternative structures led by China and developing powers.

Into this vacuum step nimble middle powers pursuing multi-alignment strategies:

India, for example, maintaining defence partnerships with Russia, deepening security ties with America, and sustaining economic engagement with China.
The UAE similarly balances relations with Washington, Moscow, and Beijing, extracting concessions from each while being captured by none.

4️⃣ The New Great Game

Against this backdrop of Western fragmentation, great power competition intensifies. The Arctic becomes the 21st century’s geopolitical pivot region—rich in resources, strategically located, and increasingly navigable as ice retreats. Russia dominates with the longest coastline and most developed infrastructure. America seeks entry through its bargain with Moscow, which would effectively partition the region between them while excluding China.

This US-Russia accommodation stems from cold calculation on both sides. For Washington, it’s presented as a reverse Kissinger doctrine: peel Russia away from China to isolate Beijing. For Putin, it offers sanctions relief and recognition of Russia’s spheres of influence. Europeans, predictably, are excluded from these negotiations about their own backyard.

Meanwhile, the US-China rivalry calcifies. Competition spans economic, technological, and military domains, with Taiwan as the most dangerous flashpoint. Xi’s 2027 deadline for military preparedness looms, creating a window of maximum uncertainty.

5️⃣ Regional Realignments

In the Middle East, Saudi-Israeli normalisation represents a fundamental reordering. But this new alignment faces a revanchist Iran backed by China and Russia. American withdrawal creates openings for other powers—Turkey as military arbiter in Syria, China as economic partner throughout the region.

Europe’s quest for strategic autonomy accelerates as American reliability diminishes. Defense spending increases substantially, with joint projects finally moving beyond planning stages. By 2028, we may see some European defence capability independent of American leadership, though still integrated with NATO structures.

The Indo-Pacific features the most complex realignment, with middle powers like Vietnam, Indonesia, and the Philippines pursuing sophisticated hedging strategies. They welcome American security presence as counterweight to China while maintaining economic ties with Beijing. Japan and Australia align more firmly with Washington, but even they preserve economic engagement with China.

6️⃣ The Economic and Technological Battlegrounds

Economic weaponisation has become standard practice. Western sanctions on Russia demonstrated the power of financial warfare. China's export controls on critical minerals in response to American semiconductor restrictions showed that such weapons cut both ways.

The world fragments into competing economic spheres: an American-led technology alliance, a European regulatory bloc, and a Chinese-centred production network. Supply chains reorganise along geopolitical lines, with “friend-shoring” replacing efficiency as the primary consideration.

Control of critical minerals—lithium, cobalt, rare earths—emerges as the new energy geopolitics. China’s dominant position in processing these materials provides leverage comparable to Saudi Arabia’s former oil dominance. America’s hemispheric focus partly reflects determination to secure these resources in friendly territory—hence the renewed interest in Greenland’s mineral wealth and Latin American lithium deposits.

7️⃣ America Alone

What emerges most clearly is America’s strategic isolation. By pursuing hemispheric dominance and selective great power deals, Washington has alienated traditional allies without securing reliable new partners. The Europeans pursue strategic autonomy, Asian allies hedge their bets, and even Canada chafes under heavy-handed American regional assertions.

This isolation partly reflects deliberate choice—a belief that allies are burdens rather than assets, and that America’s geographic position and military strength allow it to pursue interests unilaterally.

It also reflects a recognition that in a multipolar world, flexibility may trump permanent alliances.

Yet history suggests that great powers rarely thrive in isolation. Britain’s naval dominance rested on continental alliances. America’s Cold War success stemmed from its network of partners. Today’s complex challenges—from climate change to emerging technologies—require collaborative approaches.

We face a world of competitive multipolarity without guardrails. The fragmentation of the Western alliance system removes a crucial stabilising element from international politics. New groupings—from BRICS+ to the Shanghai Cooperation Organisation—lack coherence and normative foundations.

For middle powers and smaller states, the emerging order demands deft diplomacy. The ability to navigate between competing great powers without being captured by any becomes the essence of sovereignty. Some will succeed brilliantly in this environment; others will be crushed between competing pressures.

History teaches that transitions in world order are inherently unstable. The erosion of Western unity removes a critical stabilising force from the international system. In its place emerges a more competitive, complex, and dangerous environment—one that rewards strategic clarity and diplomatic finesse while punishing ideological rigidity and institutional complacency.

The emerging world order will not be Western, liberal, or rules-based. It will be pluralistic, competitive, and driven by power considerations that recall an earlier age of international politics. Those who recognise this reality first will navigate it most successfully. Those who cling to fading paradigms will find themselves increasingly irrelevant in the harsh new world taking shape before our eyes.

➡️ America’s Underwater Democracy

How institutional inertia enables authoritarianism

Democracy sometimes dies by drowning.

Consider Dunwich, a notorious English “rotten borough” that carried on sending two Members to Parliament even as the North Sea swallowed it whole.

By 1831, this once-flourishing port had been reduced to 232 souls inhabiting 44 houses “and half a church,” yet it still commanded the same parliamentary representation as major English cities.

Sound familiar? It should.

Wyoming’s 580,000 residents wield the same Senate power as California’s 39 million. This 67-to-1 representation disparity makes the Senate proportionately more absurd than many of the rotten boroughs England’s Parliament abolished nearly two centuries ago.

As Harvard professor Steven Levitsky, author of How Democracy Dies, recently warned fellow Americans: “We’re pretty screwed.”

Levitsky’s concept of “competitive authoritarianism” – where would-be autocrats acquire power through legitimate elections, then systematically undermine democratic institutions – is fed by exactly the kind of institutional inertia we see in America today.

The parallels between Dunwich’s parliamentary farce and America’s democratic erosion are both striking and terrifying. Both systems refused to evolve as reality shifted. Both maintained the appearance of democratic representation while time hollowed out its substance. Both reveal how institutional calcification enables authoritarian capture.

It took centuries and the threat of revolution for Britain to change. What will it take for America?

➡️ Why A Meta Exposé Reveals Europe’s Critical Defence Vulnerability

A US-operated digital town square is not a safe space for European democracy

Europe has a Facebook problem. Or rather, a Meta problem. And it’s far worse than they realise.

While European defence ministries obsess over tank battalions and fighter squadrons, Sarah Wynn-Williams’ scorching memoir “Careless People” exposes the continent’s actual Achilles’ heel: its digital capitulation to Silicon Valley oligarchs who view European sovereignty as an inconvenient regulatory nuisance.

The Adult Daycare Running Your Democracy

Wynn-Williams, who served in Sheryl Sandberg’s public policy department from 2011 to 2017, delivers a portrait of Meta that would be comical if it weren’t so excruciating. Here’s a company where :

Where executives jet between corporate cocktail parties while casually discussing how to make politicians “indebted to Facebook.”
Where Joel Kaplan – a Bush administration veteran whose interests stop at K Street – wielded decisive influence over “global” policy.
Where the response to genocide-inciting content in Myanmar was to assign a lone Burmese-speaking contractor – in Dublin.

This isn’t just corporate incompetence. It’s life-wrecking, conflict-causing recklessness.

Beijing’s Lessons for Brussels

The irony should not be lost on Europeans: American lawmakers are currently hyperventilating about TikTok being a “national security threat” because “the control of the algorithm that displays information to 180 million Americans” might be “controlled by Beijing.”

Meanwhile, Europe placidly surrenders the information frontline of 450 million citizens to American companies whose loyalty to European interests is zero.

America considers foreign control of social media algorithms an existential threat while Europe shrugs at its total dependence on platforms where, as Wynn-Williams recounts, executives boasted: “Facebook has an ace that the other tech companies don’t – we can make Facebook essential to electoral success.”

Europe’s Digital Munich Agreement

When Facebook negotiated with Irish officials about circumventing EU taxes, it wasn’t just corporate tax avoidance – it was a demonstration of supranational power. Each algorithmic tweak, each content moderation decision, each data-harvesting innovation represents a concession that would have shamed Chamberlain.

Yet Europe’s response has been to issue strongly-worded regulations while continuing to outsource its public square to companies where, according to Wynn-Williams, growth at all costs became “the beast that consumes Zuckerberg’s creation.”

The Strategic Imperative

If information is the battlefield of the 21st century, Europe has unilaterally disarmed. There are three things it can do to re-establish its sovereignty:

Wielding Antitrust as a Security Instrument: Breaking Meta’s platform monopoly isn’t about consumer prices – it’s about preventing a single American corporation from controlling Europe’s information ecosystem. Monopoly in digital markets means monoculture in ideas, and monoculture is fatally vulnerable to strategic manipulation.
Building a Digital Maginot Line That Actually Works: Europe is about to spend billions on weaponry that would be irrelevant in an information war. A fraction of that investment could create European digital platforms aligned with European security interests. This isn't protectionism – it’s basic strategic hygiene.
Establishing Digital NATO Protocols: Just as physical threats require collective defence mechanisms, information threats demand coordinated responses. Platforms operating in Europe must submit to oversight that treats information warfare as an actual form of warfare.

Wishful Thinking Won’t Save Europe

Meta has predictably dismissed Wynn-Williams’ account as “a mix of out-of-date and previously reported claims.” European policymakers may be tempted to do likewise. That would be a mistake.

The book’s lurid details about Sandberg’s management style, Kaplan’s callousness, or the company’s “kid’s birthday party” culture mask the deadly serious implications: Europe has outsourced its cognitive security to companies that, when faced with a choice between European interests and their own, consistently choose the latter.

In the immortal warning of Lenin – slightly updated for the digital age – “The capitalists will sell us the algorithm with which we will destroy them.”

➡️ Recession Risks And Double Speak

What Wall Street Doesn’t Want to Admit

As Goldman Sachs CEO David Solomon tells Fox News “the business community understands what the president is trying to do with tariffs” and praises Trump’s engagement with executives, his research team is quietly warning clients about recession risks and slashing its S&P 500 target by 5%.

The hypocrisy is breathtaking but hardly surprising.

As the S&P 500 slides 9% from its highs and the vaunted “Magnificent 7” tech giants tumble 14%, a nervous whisper is growing louder in executive suites and trading floors across Manhattan. Goldman has quietly slashed its year-end S&P target from 6500 to 6200, while trimming earnings growth forecasts.

They’re calling it an expectation “reset.” You might call it what it is – a recession anxiety attack.

This isn’t 2008. But the parallels to previous pre-recession environments deserve more attention than they’re getting in official research notes.

Reading Between the Lines

Goldman’s economists assign a 20% probability of recession in the next year – “slightly above the unconditional historical average.” The broader consensus puts it at 25%. These figures sound reassuringly low until you consider how rarely economists predict recessions before they arrive.

What’s particularly telling is the spike in the Economic Policy Uncertainty Index, which has more than doubled since Inauguration Day. Markets hate uncertainty, especially when it involves radical policy shifts. President Trump’s promised tariffs aren’t just campaign rhetoric anymore – Goldman economists now expect the effective tariff rate to rise by 10 points to 13%.

Every 5% increase in tariffs potentially reduces S&P 500 earnings by 1-2%, and that assumes companies can pass most costs to consumers. In this inflationary environment, that’s a dangerous assumption.

The Positioning Game

Hedge fund managers describe the recent market action as a “bloodbath” in crowded positions. Goldman’s Hedge Fund VIP list (their most popular long positions) has suffered its worst underperformance relative to the S&P 500 since March 2020 – the pandemic crash.

What’s telling isn’t just the selling but who’s doing it. Sophisticated investors are reducing risk exposure ahead of what they fear might be a more significant downturn, while mutual funds have largely maintained positions. When the smart money heads for the exits while retail stays put, pay attention.

The Valuation Reality Check

Even after the recent pullback, the market isn’t cheap. Goldman’s valuation model suggests a fair-value P/E of 20x — right where we are currently trading. The mega-cap tech stocks that carried the market higher still trade at 26x earnings despite their “Maleficent” rebrand.

History shows S&P 500 drawdowns average 24% during recessions. We’re currently down just 9%. If recession risks materialise, there’s considerably further to fall.

The Policy Wild Card

What makes this moment particularly precarious is the policy environment. Unlike previous slowdowns where the Federal Reserve could aggressively cut rates, today’s Fed faces a complex inflation picture that limits its freedom to act. Meanwhile, the fiscal side promises more tariffs, which function effectively as consumer taxes.
Administration officials privately acknowledge the economic risks but remain committed to the tariff agenda, viewing short-term market pain as acceptable for long-term policy goals.

The Bottom Line

Here’s what most market commentators miss: major banks are institutionally conservative in their public forecasts. They calibrate their projections not to be accurate but to avoid being catastrophically wrong. After being caught flat-footed in previous cycles, no bank wants to be remembered for missing the next downturn.

Thanks for reading!

Best

Adrian