Political Risk Comes Home
Why the United States Is Now the World’s Most Dangerous Variable
This week on RiskCellar, I sat down with Cliff Kupchan, Chairman of Eurasia Group, to discuss their Top Risks 2026 outlook.
And - good news - we recorded this live on our new Youtube Channel - subscribe here: YOUTUBE CHANNEL
The most important conclusion was also the most uncomfortable.
For the first time in the post war era, the United States is the single largest source of political risk in the global system.
Not China.
Not Russia.
Not the Middle East.
The United States.
That statement alone forces a rethink of how businesses, insurers, investors, and boards should be planning the next several years.
The End of the Anchor State
For decades, the US was the stabilizing force of the global order it helped build after 1945. Even when Washington made mistakes, the system assumed institutional continuity, rule of law, and predictable power.
That assumption no longer holds.
Kupchan’s view is not partisan. It is structural. Voters across advanced economies have rejected globalization as a governing philosophy because it stopped working for them. Housing is unaffordable. Food costs are volatile. Credit is expensive. Wages lag inflation.
Politics now flows from affordability, not ideology.
And affordability politics is volatile by definition.
Trump 2.0 Is Not What Markets Think It Is
One of the most important clarifications from the conversation is that Donald Trump does not fit traditional political labels.
He is not a small government conservative.
He is not an isolationist.
Kupchan describes Trump as the most interventionist American president since World War II.
This is state capitalism, not deregulation.
Picking winners and losers.
Taking equity stakes in companies.
Using tariffs, price controls, and capital restrictions as political tools.
At the same time, Trump is not retreating from global power. He is a unilateralist who believes US force should be applied selectively and decisively when American primacy is at stake.
Iran. Venezuela. Greenland.
This combination creates something markets are deeply uncomfortable with. A larger state with fewer constraints and less predictability.
Political Violence Is No Longer Abstract
We recorded this interview as political tension spilled into real world flashpoints, including events unfolding in Minneapolis.
Kupchan’s warning here was direct. Political violence is no longer episodic. It is operational.
Immigration enforcement, protest movements, and federal authority are colliding in ways that create localized but highly visible risk. These are not isolated incidents. They are previews of how political conflict manifests when institutions are under stress.
Businesses that still treat political risk as a foreign market problem are already behind.
Peak Tariffs Does Not Mean Stability
According to Eurasia Group, we have likely reached peak tariffs, particularly with China.
Beijing effectively neutralized tariff leverage by controlling critical minerals and threatening extraterritorial export restrictions. The trade war reached a draw.
But volatility has not peaked.
It has shifted.
Governance risk, institutional credibility, and executive power now matter more than customs schedules. These are harder forces for markets to model and much harder to insure against.
Greenland Is Not a Joke
Greenland may sound like a punchline. It is not.
Kupchan framed it correctly as a trust event.
Global capital depends on reliability. Courts, contracts, alliances, and investment flows assume that power respects rules even when it is inconvenient.
When allies begin to question that assumption, the cost is not immediate. It is cumulative.
Trust erodes slowly and returns even slower.
Why Corporate America Is Staying Quiet
One of the most revealing parts of the conversation was not what companies are doing, but what they are not saying.
Large corporations are keeping their heads down. Not because risks are unclear, but because retaliation feels real.
Regulatory pressure. Political targeting. Reputational blowback.
Silence itself has become a signal.
And historically, when business goes quiet, volatility follows.
There Is Still Good News
Risk reports get accused of being doom focused. Kupchan pushed back on that.
Artificial intelligence remains a real productivity unlock, particularly in healthcare, education, and logistics. India’s growth story is intact and compelling. Saudi Arabia is undergoing a demographic and economic transformation that should not be dismissed, even with its political baggage.
The world is not collapsing. It is reordering.
What Comes Next
Kupchan assigns an eighty percent probability that Democrats retake the House. That matters less for ideology and more for control of the narrative.
Checks and balances do not reduce noise. They change who controls it.
In the longer view, he believes we may be approaching peak Trump, not because the movement disappears, but because institutions eventually respond to sustained stress.
The Bottom Line
Political risk is no longer something US companies outsource to emerging markets teams or foreign subsidiaries.
It is domestic.
It is structural.
And it now belongs in core strategy discussions.
As Kupchan put it, this is not about predicting outcomes. It is about understanding asymmetry.
Insurance is simple.
Risk has never been easy.