The West has Descended into Fantasy Politics

The Collapse of Global Liberalism by Philip Pilkington

“Fantasy politics” is the best descriptor of what we’re currently witnessing in Western political discourse. That phrase is from my interview with author, public intellectual, and Danube Institute fellow Philip Pilkington. Philip has numerous zingers in this interview, like: “Now they’ve created a roach motel in Britain,” “The West is in terminal decline,” and “68% of the people in Britain think the country is fundamentally broken”.

This is my second interview with Philip. (The first interview was only released as a podcast due to filming issues.) Philip is a thoughtful, knowledgeable, and smart guy. He’s also sincere. Not in spite of but because of this, I find our conversations sobering and his arguments compelling: The decline of the West has been obvious for some time now, and it’s evident in nearly every aspect of life. This is not only obvious to Philip, and to other economists, but it’s obvious to anyone who’s paying attention.

Here are just a few points of contact for the West’s decline. The first two are, IMO, by far the most important.

Indicators of Decline:

High Public Debt

As Musk, Balaji, and others have repeatedly pointed out, the US national debt is completely out of control. And it is increasingly looking like we will not be able to pay it off. As evidence, look no further than the discourse around Trump’s Big Beautiful Bill. And for the record, I adamantly oppose anything and everything that will increase our debt.

Energy Crisis

We are not producing nearly enough energy to meet our needs, and projections are that the US will need to double energy production in three years to meet AI needs and data center demands. There is also no plan to meet imminent energy needs. (For more here, I highly recommend Jesse Peltan’s feed.) The energy situation is far, far more dire than one would think, esp. given the AI race. No energy, no AI. No AI, and we cannot compete with China. If we lose the AI race, we lose every subsequent race. AI will be our last invention.

Economic Stagnation

The Eurozone experienced slow economic growth, and the US GDP growth is projected to decelerate from 2.8% in 2024 to 1.5% in 2025 and 1.3% in 2026.

Deindustrialization

The West has lost significant manufacturing capacity. There is no coherent plan to regain that capacity.

Political Polarization