The Thematic Edge opens 2026 with its first guest, David Kilcullen, retired Australian Army colonel, intellectual architect of both the “Surge” in Iraq and Afghanistan, and the world’s foremost authority on counterinsurgency. Colonel Kilcullen helps us make sense of what happened in Venezuela on 5 January and what to expect going forward.
The discussion is structured around three questions that matter for markets.
* First, what actually happened operationally, and what it reveals about escalation control, deterrence, and the limits of legacy air defence systems.
* Second, what the episode signals about US grand strategy, the “Trump corollary of the Monroe Doctrine, the return of gunboat diplomacy, and the use of suzerainty style constraints to shape trade, currency choice, and commercial alignment.
* Third, what long-term “success” means and what must be achieved to meet it, including political stabilisation of Venezuela, establishment of payments systems, control over resources, and how quickly the US needs to move before the window closes.
Along the way, we challenge the prevailing narratives including claims of pre-negotiation with or foreknowledge of China and Russia, implications for the emergent global order, Taiwan, Ukraine, Europe, other regions’ security, who might be “next,” the scramble for resource control, what to watch for, and Venezuela’s potential as a test case for dollarization via stablecoins. With so much to talk about and such an insightful guest, this episode is longer than usual, but it will be required listening/viewing for anyone interested in assessing risks and making informed decisions in today’s rapidly shifting global order.
Full transcript
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Marvin Barth: Good evening, and welcome to…
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Marvin Barth: the Thematic Edge. We are very excited, to start 2026 with our very first guest on the Thematic Edge. So, this time I’m not only joined by my longtime friend and colleague, Mark Farrington.
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Marvin Barth: Who’s going to join me in asking some of the questions of our guests.
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Marvin Barth: But I’m also joined by another very old friend of mine, David Kilcolon, and we are very fortunate to have him.
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Marvin Barth: for reasons we can discuss another time. My nickname for him is the International Man of Mystery, and most of that has to do with the fact that I can never get ahold of him, and he seems to be in some crazy place without cell phone connections.
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Marvin Barth: So we’re very lucky to have him, because he is exactly the right person to talk to
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Marvin Barth: about the events in Venezuela that occurred over the weekend. David is a retired colonel from the Australian
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Marvin Barth: Army. He, was a key advisor in both the Bush and Obama administrations. He has a consulting business, Cordillera Applications Group.
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Marvin Barth: That consults to many of the leading militaries, military alliances.
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Marvin Barth: and companies, around the world on security issues. He is universally acknowledged as the world’s foremost authority on counterinsurgencies.
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Marvin Barth: And he also happens to be a tremendously good, grants strategist, as illustrated by his last book, The Dragons and the Snakes. All his books are fantastic. I highly encourage you to go out and
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Marvin Barth: read them.
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Marvin Barth: David, welcome, and thank you for joining us.
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David Kilcullen: Thanks, Marvin. It’s an honor to be here, and my publisher thanks you for that very blatant plug of my books.
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Marvin Barth: well-deserved. I mean, if you want to understand any of the military or geostrategic developments of the last 20 years.
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Marvin Barth: you have to read David Gilkullen’s books. You know, Counterinsurgency is literally the field manual for counterinsurgency, not only for the U.S. military, but for most militaries around the world at this point.
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Marvin Barth: Out of the Mountains really described many of the things that we are now seeing take place, whether it was in Gaza or Ukraine. All of those things were basically forecast by David over a decade ago in that book.
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Marvin Barth: And in terms of the best possible framework for thinking about the geostrategic environment and the challenges that Western democracies face.
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Marvin Barth: Both militarily, economically, and strategically. You know, The Dragons and the Snake was second to no book out there, so, you know…
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Marvin Barth: I’ll give you another plug there. Now, before we… Before we go on,
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Marvin Barth: The, I do want, to remind everyone that nothing on this podcast should be considered, financial advice. You need to do your own research. We are providing information here, and especially on this topic, where we are literally in the fog of war, even though it’s an undeclared war.
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Marvin Barth: You should not rely on any of this information as being factual, because everything is up in the air right now, and we are doing our best to make sense of the information that is available.
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Marvin Barth: So with that, let’s start with, I actually wanted to structure this in sort of 3 segments that I think
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Marvin Barth: best fit your expertise, Dave. The first is just, like, diagnostic. What actually happened? You know, if you were a theater commander or something, and you were getting in this, this information, or you were,
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Marvin Barth: the head of the PLA trying to figure out what the heck the Americans just did.
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Marvin Barth: How would we assess what actually happened?
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Marvin Barth: Based on the information we have, today, the 5th of January. The second is really getting to that geostrategic point.
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Marvin Barth: you know, what are the grand strategy implications of this, not just for the U.S. and for the region, but globally, and then finally get back to where you are the, you know, clear, acknowledged expert, on counterinsurgency, which is really, and you’ve emphasized this over and over, really about creating a stable society, which is what it’s going to take to make this operation ultimately successful. So we want to get that.
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Marvin Barth: And in the end, I think we’ll get to, if we have some time, some, markets issues, which, feel free to, ask Mark and I questions around that.
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David Kilcullen: Absolutely.
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Marvin Barth: So let’s start with… I mean…
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Marvin Barth: One of the things that has been floated around a lot, is that this was somehow, pre-arranged, right? That this was a negotiated.
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Marvin Barth: settlement. And, you know, there are several signs, at least to my untrained eye, that suggest that. One, the strikes that were… that took place were actually quite limited, it seems.
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Marvin Barth: And there are a lot of, anti-aircraft weapons in, Venezuela. Their army may not be fabulously trained, but they’ve got lots of, equipment from, all their, foreign friends. And yet you were able to have a helicopter-led,
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Marvin Barth: exfil within a couple of hours without losing anybody. And then there’s also the sort of confidence that President Trump displayed in his press conference, suggesting that, you know, they’re basically going to run things under the new regime.
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Marvin Barth: Do you see this as a prearranged, or a negotiated settlement, or… and how did that work, or do you have other theories about what was going on?
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David Kilcullen: So…
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David Kilcullen: So I’ll put that caveat out there to start with. But I think it’s pretty clear…
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Marvin Barth: Dave, you froze for a second, so if you wouldn’t mind, what was that caveat again?
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David Kilcullen: Sorry, I was just saying that, the short answer to many of these questions is we don’t know, right? Or we don’t know yet. So, we should just bear that in mind as we’re… as we’re talking about it.
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David Kilcullen: The… I think the…
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David Kilcullen: it’s not a secret that there’s been ongoing negotiation between the US government and the Venezuelan government over almost a year now about a set of issues, but the one that’s become the sticking point was the stepping down
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David Kilcullen: of Maduro. As far as we know, about a week ago.
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David Kilcullen: that set of negotiations reached an impasse, where Maduro was essentially offered
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David Kilcullen: safe passage to exile, perhaps to the Middle East, or to Russia, where Bashar al-Assad is right now, of course. And this has seemed to have been a…
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David Kilcullen: preferred playbook from the Trump administration to offer a way out and a graceful exit with as much cash as you can carry, you know, to a comfortable retirement somewhere else.
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David Kilcullen: by the way, watch that space for Zelensky’s future, too, depending on how things go in Ukraine. But, I think the, the ultimate breach came about a week ago, when Maduro
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David Kilcullen: essentially said, no, I’m not stepping down under any circumstances, and then engaged in a fairly public trolling of
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David Kilcullen: the Trump administration by dancing on…
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David Kilcullen: television and, talking about, you know, let’s make love not war, or let’s make peace not war. And that seems to have been the trigger, for the move on the operation, which of course had also been set up in a military sense for several months beforehand.
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Marvin Barth: Okay, and now, there’s another whole set of conspiracy theories around this, that this was all some sort of quid pro quo with the Russians and the,
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Marvin Barth: Chinese. In fact, this goes back to some of the issues that Mark and I discussed in our last episode of the Thematic Edge.
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Marvin Barth: where we talked about a lot of the misperceptions of the latest national security strategy, that seemed to suggest the U.S. is going to pull back and leave everybody else with their spheres of influence.
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Marvin Barth: And… that…
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Marvin Barth: has led a lot of people to think that’s what this was all about, and that basically, you know, Taiwan is now going to be given free rein to… you know, China’s going to be given free rein on Taiwan, Russia’s going to be given free rein in Ukraine.
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Marvin Barth: How do you read this? Do you think that the Chinese or Russians were involved in this, that there was any sort of quid pro quo, or were they completely unaware of this, or were they aware but just couldn’t do anything about it?
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David Kilcullen: So again, we don’t know, but the evidence we have so far suggests that they probably were not aware of it ahead of time, or at least aware of the specifics. They knew something was coming, and we’ve seen comments, like warnings from Beijing and Moscow over the… and Tehran, by the way, over the past…
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David Kilcullen: few weeks, attempting to warn the US off the operation. So, and then we saw a very vociferous response.
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David Kilcullen: from Chinese, state-controlled media, which is…
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David Kilcullen: basically all media in China, and from the Russians, in the last couple of days since the operation. So I don’t think they were involved in the operation, or I don’t think that there was any effort given to, you know, get their permission or make them okay with it. That doesn’t mean
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David Kilcullen: that the Trump administration isn’t going to offer them some kind of a sweetener in the next few weeks as a way of minimizing.
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Marvin Barth: Pushed…
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David Kilcullen: And that’s quite possible. But I think, they were probably… Either decided not to…
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David Kilcullen: resist, and not to assist, Venezuela in aid of not picking a fight with the US in its own backyard, or they potentially were unable to, and this is one of the technical questions
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David Kilcullen: that’s going to have to come out, about the performance, in particular, of Chinese and Russian air defense systems, over Caracas during the operation. And we can talk about that more if you want, but that’s a key issue.
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David Kilcullen: the Chinese have been, riding high a little bit since the Indo-Pakistan conflict in 2025, because of the better-than-expected performance of their air and air defense systems. And, I think it’s going to be an interesting question to see exactly
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David Kilcullen: what comes out once a bit more detail comes out. We can talk about that in a military sense, if you’re interested.
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Marvin Barth: Actually, I mean, I think this was a question that Mark had raised with me earlier, definitely, and, you know, it does relate to a broader set of questions that I had on sort of tactical lessons that we learned from this operation. What did we learn about
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Marvin Barth: the U.S, you know, there were also reports that
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Marvin Barth: you know, several, U.S,
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Marvin Barth: targets were, missed or hit, civilian infrastructure that was unintended, things like this. So even in what seemed a very permissive environment.
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Marvin Barth: From, an air superiority perspective.
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Marvin Barth: there were mistakes on the U.S. side, despite what the Trump administration is casting this as. What lessons did we learn there? And then, exactly to this point, you know, that gets to one of these critical questions.
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Marvin Barth: About it being a negotiated settlement, or were there failure of systems?
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David Kilcullen: Yeah. So, why don’t we just baseline it by talking a little bit about what we know right now about how the operation went down, and then we can talk a little bit in more detail about it. So, for several months now, the US has had a build-up going on in the region of Venezuela.
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David Kilcullen: At its peak, in the last few weeks, you had
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David Kilcullen: A, an aircraft carrier battle group.
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David Kilcullen: You had an amphibious ready group, which is basically a big-deck amphibious ship with a marine organization on there, and lots of helicopters and other ancillary…
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David Kilcullen: material. Almost certainly there were submarines, and a number of other assets in place, because you don’t risk those kinds of assets without that sort of protective envelope around them.
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David Kilcullen: In addition, we saw the build-up of Special Operations Forces on islands close to Venezuela, and a build-up of Marines in Puerto Rico. So we saw a sort of regional build-up.
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David Kilcullen: of Army, Navy, Marines, Air Force, Space Force, Cyber, all those assets building up overtly in the region. It now appears, and I think not surprisingly at all, that there was also a CIA team on the ground in Venezuela.
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David Kilcullen: And almost certainly a special operations paramilitary team as well. So a special warfare team, and of course, when we talk about the CIA, it’s a bit unusual.
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David Kilcullen: in terms of global intelligence services, but it has both a paramilitary arm and a traditional intelligence arm. And I think we saw both of those potentially play a role here.
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David Kilcullen: So what essentially seems to have happened is that the operation began by knocking out command and control systems, probably some cyber and space-based activity, and signals, disruption of the Venezuelan systems, followed by a very large-scale
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David Kilcullen: what we call a SEAD package, Suppression of Enemy Air Defenses package, coming from the ships and from a variety of land bases, at least 150 aircraft, approaching Caracas from multiple directions, which is something you do in order to throw off
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David Kilcullen: radar systems when you’re about to do a SIAD mission, and then striking various air defense systems. Russian S-300, S-400,
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David Kilcullen: Chinese systems, probably some others, a lot of guns as well, like anti-aircraft guns, essentially trying to black out Caracas and knock out its air defenses. And then while that was going on.
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David Kilcullen: We saw low-level helicopter insertion.
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David Kilcullen: of Delta Force, which is the Army’s, Tier 1, strike organization. Probably some other assets as well.
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Marvin Barth: What is Delta Force’s official initials, I think?
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David Kilcullen: with ODD, Special Forces Operational Detachment Delta, right?
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Marvin Barth: Aren’t they also called something like Combat Oper…
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David Kilcullen: Oh my god.
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Marvin Barth: group.
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David Kilcullen: Combat Applications Group, yes, they have been called that in the past. They have various.
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Marvin Barth: No relation to, to, to.
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David Kilcullen: relationship.
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Marvin Barth: Applications great.
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David Kilcullen: Any resemblance to CAG is purely accidental.
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David Kilcullen: But, yeah, so those guys came in, raided the palace where…
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David Kilcullen: President Maduro and his wife were located. He seems to have attempted to enter a safe house, but was… or a safe room, but wasn’t able to do that. He was extracted.
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David Kilcullen: they then got into a gunfight, in Caracas as they were attempting to extract, which is rather a similar scenario to Black Hawk Gown, for those who remember that incident 30 years ago. But it went much better. Some Americans were injured.
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David Kilcullen: no one was killed, as far as we know. About 40 civilian and military people were killed on the Venezuelan side, and they successfully extracted the
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David Kilcullen: The president and his wife.
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David Kilcullen: to the USS Iwo Jima, at sea, and then from there, he’s just arrived in New York and is about to appear, in court. So, basically a…
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David Kilcullen: I wouldn’t say flawless, but a very well-executed and competently executed multi-domain operation, as we call it, resulting in the seizure of a high-value target, and
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David Kilcullen: basically no remaining U.S. forces on the ground. So, even though right now there’s discussion coming out that the…
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David Kilcullen: Venezuelan vice president is the US preferred candidate. She’s also the natural person that would have taken over just in the normal course of events if Maduro had been hit by a bus, right? So, it’s not that the US has imposed its preferred candidate, it’s just that they’ve expressed
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David Kilcullen: likely satisfaction with the candidate who is going to step into that spot anyway. So we can talk about that in a bit more detail, but I think the… the… the tactical execution
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David Kilcullen: was not necessarily flawless, but was very competent and effective. The real question is, what next, right? What happens now? And, what did Trump mean when he said, we’re going to run Venezuela? I have my ideas on that.
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David Kilcullen: Does he mean the same thing by that as Marco Rubio does? Does she understand that? You know, what are we looking at here? And I think a general theme, maybe to lead into the next phase of the conversation, is that we’re seeing
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David Kilcullen: a move away from the concepts, or more rightly, the rhetoric, of democracy promotion and the international rules-based order that we saw under the Bush administration, the Obama administration, and the Biden administration, to something that’s more late 19th century, early 20th century, of
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David Kilcullen: Gunboat diplomacy.
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David Kilcullen: what we call suzeraine, which we can talk about, and, and protectorate status, right? Something much more akin to, say, the Banana Wars of the 1920s, or the, the Platt Amendment that governed
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David Kilcullen: U.S. relationships with Cuba after the Spanish-American War. So not occupation, not regime change, not democracy promotion, but basically putting a protectorate status over a country where we say.
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David Kilcullen: US commercial interests are going to have primacy, there are going to be limits on your foreign policy options, and there’s going to be some limits on your economics. For example, you have to do business in dollars rather than yuan, for example. And other than that.
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David Kilcullen: in terms of your own internal governance, we’re not going to interfere. This is, what the Chinese would describe as tributary status, which we historically have talked about as suzerainty, which is where a country asserts control over another country’s
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David Kilcullen: foreign policy to a greater or limited degree, but not in terms of internal administration. Now, whether that works is a different question, but it seems to be…
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David Kilcullen: both what the Trump administration has in mind for the next stage politically, and also very well aligned with what you guys talked about on your last podcast about the national security strategy. So anyway, that’s a possible segue to a broader discussion.
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Marvin Barth: I definitely want to go in that direction, that’s where we want to go next, but I think just…
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Mark Farrington: touch a few more, sort of tactical and what happened issues. Mark, did you want to ask about the specific Chinese example, or… or an…
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Marvin Barth: Yeah.
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Mark Farrington: Yeah, yeah, I think that, you know, there’s a lot of interest to see what we can glean out of this operation that has relevance for the other theaters, whether it be in Europe, but probably primarily surrounding Taiwan.
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Mark Farrington: I mean, obviously, the kind of build-up that you articulated so well that the U.S. has been put in place for the last 3 or 4 months in the Caribbean.
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Mark Farrington: is not the way that the U.S. would approach a conflict with a geopolitical rival like China or Russia. So, you know, I don’t think it’s the formation, the structure, and the stealth that is as relevant, but there is, I think, interest in, you know, any sort of what can be called, you know, hardware or software failures or, you know, rival power.
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Mark Farrington: failures. So, and as far as you know, were the anti-aircraft missiles, the radar, early warning systems, etc, were they top shelf, the best that Russia and China have available, or were they third, fourth generation old that had been sold to generate… sold to Venezuela years ago?
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Mark Farrington: or the cheapest that they could afford. And so, therefore, we can’t really extrapolate too much about what happened and how easily it was taken out by the U.S. attack.
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David Kilcullen: So, great question, and again, I think we don’t know for sure yet, but what we are seeing so far suggests that it wasn’t necessarily the latest gen
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David Kilcullen: of Russian, or Chinese material. The one that’s been focused on is S300, that’s a 30-year-old system. The S400 is 20 years old.
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David Kilcullen: There are… there was also a fairly widespread usage of SA7s or, handheld or shoulder-launched.
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David Kilcullen: Air defense systems, which, are actually harder to counter than some of these larger scale systems, but are less effective in disrupting the kind of, stealth
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David Kilcullen: heliborn-type assault. Helicopters are big, they move slowly, they generate an enormous radar signature because of the,
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David Kilcullen: speed of the rotor tips, which generates this huge echo on radar. So it’s really hard to hide a helicopter insertion against a functioning air defense system, what we would call an integrated air defense system that includes
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David Kilcullen: Sensors and a command and control system, radars, audio sensors, that kind of thing, as well as,
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David Kilcullen: you know, guns and other systems for shooting down aircraft. So what you need to do is disaggregate that system. That’s what a CAD mission is, right? You’re trying to blind the command and control, knock out the radar sensors, confuse the guys that are running the system.
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David Kilcullen: and then separately knock out the actual shooters, and I think we saw a fairly effective takedown here. I would be surprised if…
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David Kilcullen: you would see a similar success in an attempt to, hypothetically, knock out Russian systems in the Baltic, or
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David Kilcullen: Keningrad, or to knock out Chinese systems in Fujian or Guangzhou, in the event of a Taiwanese example, just to take two random,
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David Kilcullen: ideas. I think I’d be… I’d be skeptical that you would see similar performance against a peer Tier 1 adversary, because it’s not a matter of having the platforms, it’s also a matter of
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David Kilcullen: Who was running them? Did the Russians have crews on the ground to run those? Did they pull them out at the last minute because they were worried about being caught up in a direct conflict with the US? If they didn’t have crews on the ground, how good was the training of the Venezuelan crews? You know, there’s all these kinds of questions that will come out, but just haven’t come out yet in detail.
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Mark Farrington: Okay, that’s fantastic. That’s what I assumed, but it’s good to hear it from the expert. And then just one other small question. It looked to me like the footprint of where all of the missile strikes were in Venezuela, that there was a few that were quite far away from the palace and the fort where the extraction event took place, and so I was just wondering, is it known, were those all just communication satellites.
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Mark Farrington: outposts, or was there actually another target that is not being discussed that we took out,
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Mark Farrington: Simultaneously under the cover of the extraction mission.
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David Kilcullen: So it’s fairly clear that, yeah, that’s a great question, and it’s fairly clear that not only were they targeting
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David Kilcullen: Air defenses and the palace itself.
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David Kilcullen: they were targeting what we call the QRF, the Quick Reaction Force, that would have been able to inter… interfere with the extraction. And…
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David Kilcullen: Some of those sites were probably communications nodes, some of them may have been, QRF locations. There’s a fairly extensive documentation of Cuban.
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David Kilcullen: and other, special forces in, Venezuela, not all of whom would have been in Caracas. So I think, again, more details will come out, but for sure, they would have been trying to…
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David Kilcullen: not only prevent any interference with getting the raid team in, but also, perhaps even more importantly, preventing, like, a Blackhawk Down scenario, and ensuring that it could actually get back out to the, to the ships, and knocking out, the…
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David Kilcullen: Venezuelan Air Force, not just air defenses, and knocking out, QRFs, I think would be a… would have been an important element there.
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Mark Farrington: Okay, that’s excellent, thanks for that.
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Marvin Barth: Following up on one quick point that you mentioned.
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Marvin Barth: you know, Cuban Special Forces. I mean, there… there were… there are…
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Marvin Barth: a number of different foreign forces and, you know, advisors, on the ground in Venezuela, Cubans first and foremost among them, and I think often seen as
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Marvin Barth: enforcer elements within the regime. You obviously have Russian forces there, North Korean, Iranian, Hezbollah.
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Marvin Barth: Were any of… or do we have any information? Were any of those… foreign forces targeted.
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David Kilcullen: So we don’t have any close… any detailed information on that as yet. I would be very surprised if the Cubans were not caught up in it, because they provided
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David Kilcullen: a close personal protection element, amongst other things, to the… to the Chavez regime, and then to the Maduro after that. They’ve got a long-standing relationship going back to Chavez and going back to what’s called the
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David Kilcullen: continental Bolivarian movement, which is the sort of general Shavista tendency in, northern South American politics. So, I think the Cubans, for sure. I’d be surprised if the Russians were directly involved,
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David Kilcullen: Or the Chinese, but it’s possible. And then the North Koreans, have allegedly had some special forces
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David Kilcullen: working with the collectivos Chavistas, the Chavista Collectives, which are these paramilitary forces that have been working, for the regime, probably also working with other elements of the regime. No evidence yet
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David Kilcullen: that they were targeted, and there’s actually some dispute about whether they were even really there. So, I think for sure the Cubans, probably not the Russians or the Chinese, probably not the North Koreans. Iran and Hezbollah.
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David Kilcullen: The Iranians and Hezbollah were both involved in export of drone technology to Venezuela
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David Kilcullen: And in a couple of other areas of military tech, so I’d be surprised, again, if they weren’t caught up, but I’m not sure they would have been directly targeted as part of this.
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Marvin Barth: Let’s move to that second discussion, which you already sort of provided the launch pad for, in that, you know.
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Marvin Barth: Mark and I have talked about before, and, you know, I’ve written about it extensively, and
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Marvin Barth: you know, frankly, building on one of your books that I mentioned earlier, The Dragons and the Snake, that, you know, the Dragons and the Snakes, that the post-war liberal order is already dead. It’s been dead for a while.
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Marvin Barth: And in many ways, I look at Donald Trump’s election in 2016 as sort of
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Marvin Barth: The church bell ringing to tell you it’s dead. Not that he brought it down.
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Marvin Barth: But here you clearly see that the Trump administration
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Marvin Barth: And I think many people will read it as, this is the end of the post-war liberal order. I would say, no, this is the…
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Marvin Barth: an attempt to establish a new world order that, as you put it, does have a lot of similarities with the, sort of, late Victorian era.
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Marvin Barth: I mean, is that the way that you see it? Is that where we’re going? Or what do you see as the direction of the world order at this point?
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David Kilcullen: So I think it’s very clear, and we’ve talked about this before in other circumstances, that
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David Kilcullen: globally, we’re seeing a transition to a multipolar world system, and that doesn’t necessarily mean China, Russia, or Iran replacing the United States as the primary actor in an international system. It may see…
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David Kilcullen: a series of… I don’t actually like the term spheres of influence, but let’s go with that temporarily. A series of regional orders, rather than a single world order, in which each of the major players
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David Kilcullen: Arrogates to itself a very high degree of agency in its own region.
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David Kilcullen: still wants to do things in other regions, but accedes to other great powers having stronger interests in those regions that are closer to them. So, clearly in the case of the Trump administration.
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David Kilcullen: The region with which the administration is most heavily concerned is the Western Hemisphere.
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David Kilcullen: And, of course, the Western Hemisphere runs all the way from the North Pole to the South Pole, right? It is, by definition the same size as the other half of the Earth, so there’s a lot going on in there. And, you know, I noticed the Danes are…
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David Kilcullen: I don’t know what the Danish for pearl clutching is, but they’re engaging in a certain amount of concern this morning about could Venezuela be a template for the Trump administration to move on Greenland?
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David Kilcullen: The short answer is yes, it could, but it’s highly unlikely, right? The… another way of thinking about this is that this move was about…
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David Kilcullen: securing a re-entry of U.S. oil companies to Venezuela, reopening the lower Venezuelan crude, which, of course, US Gulf Coast refineries are well-structured to
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David Kilcullen: process that sulfur-heavy, you know, viscous oil that we see from Venezuela, the other main source of that is Canada, right? So, Canada can be seen potentially as an ideological adversary right now of the Trump administration.
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David Kilcullen: That’s a slight overstatement, but you could argue that there’s a significant difference of opinion there. So, this is also a way of…
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David Kilcullen: de-emphasizing Canada’s economic role in U.S. oil refinery operations. So, basically, what we’re seeing here is, and I think President Trump was accurate here, we’re seeing a restatement or a re-emphasis of the
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David Kilcullen: Monroe Doctrine, which, of course, in its original form was about keeping the present, the military presence of European powers out of
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David Kilcullen: the Western Hemisphere. Then became, under the, first corollary, the Roosevelt corollary to that doctrine in 1904,
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David Kilcullen: an assertion that the US could intervene at will in the region for reasons of democracy promotion, stability, or other good reasons, you know, sort of responsibility to protect type reasons.
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David Kilcullen: what we’re seeing with the Trump, corolli is basically saying, and we can do that for economic reasons, for our own…
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David Kilcullen: relatively narrow, U.S. commercial interest, and we are not even going to tolerate the commercial presence or the ownership of infrastructure by great power rivals within that very narrowly defined geographical region.
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David Kilcullen: of the Western Hemisphere. I think that’s a… an important…
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David Kilcullen: development, but it’s a linear development. It’s not some kind of, astoundingly atrocious Trump innovation. It’s a linear progression on what has effectively been Trump, been, US policy for…
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David Kilcullen: almost 200 years now, so I don’t think this is necessarily the departure that some people think it is, but it’s certainly a way to think about how the administration might operate in the future.
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Mark Farrington: David, can I just jump in here for a second? I mean, I had the same extrapolation that you laid out there from the Roosevelt corollary, which was that,
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Mark Farrington: this idea that the U.S. reserved the right to intervene in order to avoid instability and to defend against the European powers moving in the Western Hemisphere.
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Mark Farrington: with the Trump corollary being the addition of offense. So not just a defensive corollary, it’s an offensive corollary that gives them the right to kick out non-hemispheric players that are already there, that have actually taken advantage of the instability that’s, you know, that the U.S. has tolerated over the last couple of decades. And so that’s why it looks, perhaps, more aggressive
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Mark Farrington: In the beginning, because there’s this role of kicking out the unwanted players in the region, before it will then start to become a bit more, like.
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Mark Farrington: dollar diplomacy, where you’re trying to encourage stability and democracy through U.S. investment, and particularly led by private sector companies rather than, you know, government military bases or something like that. Do you think that makes sense, that there is an offensive component that didn’t exist before?
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David Kilcullen: Well, I do think… I do think it makes sense. I would offer a couple of caveats. One,
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David Kilcullen: the US and the United Kingdom almost went to war in the late 19th century over Venezuela, as it happens. And one of the triggers for that was a potential French rival canal and a British rival canal to what became
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David Kilcullen: the Panama Canal. Panama, at the time that the canal was constructed, was part of Colombia, and the US went in, in its sort of original use of gunboat diplomacy.
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David Kilcullen: on the pretext of, Bogota oppressing its northern province, and seized that province, took it away from Colombia, and created the independent country of
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David Kilcullen: I’m making air quotes for those that are listening, of Panama, and the US-controlled Panama Canal Zone.
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David Kilcullen: as a result of that, and Roosevelt, in 1904, articulated his corollary to the Monroe Doctrine after the fact, right? So, they… they… I think perhaps the…
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David Kilcullen: the most significant departure here is one of presentation, right? Because in theory, the original Roosevelt corollary was, we’ll do it for your own good, right? We’re doing this for your own good, for democracy and for stability, and yes, there’ll be a side effect of
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David Kilcullen: benefit for, the United States.
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David Kilcullen: Trump’s been fairly clear that he reserves the right to intervene purely for U.S. national interest, whether or not it’s in the interest of local populations in the region, and that he will do so to pursue U.S. commercial interests. And again, I don’t think of much of a substantive departure, but a difference of…
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David Kilcullen: presentation, to be sure. So, I agree, though, with your first point about…
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David Kilcullen: Will we see a period of, of,
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David Kilcullen: offensive action, before we potentially see a more stability-focused approach. I would say that if a Trump administration official was here on this podcast with us, they would probably say, well, what we’re doing here is rolling back
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David Kilcullen: unacceptable hybrid warfare offensive, advances by adversaries in the region, and we only are doing it because the Biden administration signally failed…
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Mark Farrington: Is that, there we go. You froze again. I lost you there for the last 5 seconds.
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David Kilcullen: Sorry.
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David Kilcullen: Obviously getting jammed… obviously getting jammed by the, the Russians here. No, I was saying, I think that their position would be…
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David Kilcullen: the Trump administration’s position would be that they had to do this because the Biden administration allowed such inroads by Iran, Russia, and China to the region, and they’re in a forced phase of rollback. You can debate that, but I think from a military standpoint, and leaving aside the political
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David Kilcullen: trolling that’s implicit in that. The military point would be that the Trump administration is also broadening the notion of the Monroe Doctrine beyond conventional military engagement to what we call hybrid warfare, right? So.
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David Kilcullen: Political warfare, economic warfare, cyber, you know, unconventional presence, that kind of stuff, is now going to be considered…
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David Kilcullen: part of a spectrum of action that the US reserves the right to use military force to respond to.
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Mark Farrington: Excellent.
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Marvin Barth: So this… I mean, one of the clear, sort of.
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Marvin Barth: you know, justifications, if you want, for this. If you think about it in the context you just laid this out, is that
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Marvin Barth: you know, Venezuela was a center of a lot of serious threats to the U.S.
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Marvin Barth: So, you have, you know, a government that is aligned with
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Marvin Barth: multiple key strategic adversaries abroad. Russia, China, throw in regional, the Iranians, the North Koreans.
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Marvin Barth: It is also aligned with a bunch of, narco groups, right? There are various factions of the Maduro regime were associated with different, drug cartels, that are heavily armed.
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Marvin Barth: and, you know, effectively are NGO armies, in the same way that, you know, Hezbollah or Hamas or others were used as asymmetric assets by Iran in the Middle East.
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Marvin Barth: You also have a whole social phenomenon in terms of the impact of the drugs they’re pushing into the United States in terms of deteriorating
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Marvin Barth: and breaking down U.S. society, all of those things, combined with, Chinese monopolization, increasingly of the… forget about the oil, right? The U.S. actually is
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Marvin Barth: flooding the world with oil right now. It doesn’t really need much oil. Yes, it’s refineries.
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Marvin Barth: Can use, doesn’t have to, heavy oil.
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Marvin Barth: but it’s really, you know, one of the critical issues here is the critical minerals that they’re increasingly finding in the Orinoco. So, you look at all those different things, and it says, this is a place we need to make sure our adversaries don’t control and cannot use as a staging ground
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Marvin Barth: for, asymmetric attacks on the United States.
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Marvin Barth: And so… the question I would take from that for you is.
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Marvin Barth: That’s been true for quite a while, right? So, what changed? Did… is it… there’s at least some things I’ve read out there who are saying, oh, well, this has now become a critical issue, or one or more of these issues has become critical.
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Marvin Barth: I’m not sure I read it. I read it as a regime change within the United States in terms of its view, and it was manifest in the Trump administration’s second-term first national security strategy.
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Marvin Barth: Am I wrong to look at it that way? Was there something that critically changed recently that forced this action, or was this just… is this part of what you’re seeing as this is, defining a, new order relative to the collapse of the post-war liberal order?
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David Kilcullen: So, yeah, there’s a lot to unpack in there, but I will just start this discussion by flagging that.
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David Kilcullen: the US, under the Biden administration, suffered what most strategists would agree was a loss of deterrence capability, right? So, partly through the unmitigated fiasco of the collapse in Afghanistan,
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David Kilcullen: Perhaps more so by the fact that no one was held accountable for that, loss, and that the Biden administration tried to spin it as a successful evacuation when literally everybody knew that it was a defeat and the loss of the war on terror.
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David Kilcullen: After 20 years. And then the second big one was that within 6 months of that collapse in Afghanistan, the Russians invaded
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David Kilcullen: full-scale invasion of Ukraine over very stark warnings not to do so by the Biden administration, which, basically
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David Kilcullen: leaving aside the party politics of Democrats versus Republicans left the US in a much less powerful position in terms of deterrence vis-a-vis other great powers than it had been until that point. So one of the imperatives for an incoming Trump administration
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David Kilcullen: Was to reestablish deterrence.
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David Kilcullen: Another third… a third area where there was, a loss of, face, as it were, was in the Red Sea, where both a European and a US task force failed to reopen the Red Sea and the Baba Mendeb Strait to, to civilian commercial shipping.
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David Kilcullen: against a, basically ragtag Houthi army funded by and supported by Iran. So there was a need to demonstrate something in order to re-establish, deterrence.
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David Kilcullen: moving into Europe.
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David Kilcullen: to reestablish deterrence by hitting back against Russia is not a Trump goal, right? His goal, rather, is to find a modus vivendi with the Russians, and to stabilize the situation in Ukraine without allowing the US to be
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David Kilcullen: gone into it, so that was a non-starter. He’s also trying to disengage, to some extent, from funding, European, action.
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David Kilcullen: Moving on Taiwan, also not a viable model because of the leverage that China holds economically over the United States. They would have been able to hit back even harder in that attempt. But a lot of the things that we’ve seen over the last 12 months have been… I mean, this is a…
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David Kilcullen: To be a bit disrespectful, but have been…
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David Kilcullen: thematically linked by the theme of the US casting around for something that it could do to re-establish deterrence without directly picking a fight with Russia or China. And I think…
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David Kilcullen: what we just saw in Venezuela does that, right? It says, we can still carry out a competent military operation, we can still generate a massive effect. Hey, by the way, your hardware didn’t perform very well.
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David Kilcullen: Also, we showed restraint by not striking directly on the Wagner Group or any of the Russians that are on the ground. And, you know, don’t screw with us, because, if we can do that in our region…
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David Kilcullen: maybe we can do it in yours, but do you really want to take that chance, right? So it’s trying to establish a very high degree of deterrence and agency in its own regional, quote-unquote, sphere of influence. But,
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David Kilcullen: at the same time as the NSS made clear, giving a lot of rope to great power.
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David Kilcullen: adversaries in their own regions. That’s why I don’t really like the notion of sphere of influence, because the US is actually asserting global
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David Kilcullen: control over certain functional areas, whilst asserting regional hegemony, right? Again, loaded term, but regional suzerainty, right, in its own region, over other countries. Now, whether other countries are willing to go along with that is a different question.
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Mark Farrington: Yeah
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Mark Farrington: That’s an excellent point, David, because I also thought that it wouldn’t be too long before the analyst community began to link the Truman Doctrine to the Trump NSA as well, because
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Mark Farrington: You know, they have made an effort to fund and finance some of the frontline allies that they have against the great powers, like
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Mark Farrington: dialing up the military investment in Philippines, for example, and, you know, offering the financial support that it has to various peripheral points of the NATO alliance, etc. So, it’s not full proxy war, like we saw in the first Cold War.
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Mark Farrington: But it is a Truman-like response to, you know, China’s countermoves, and so it’s… I always struggle to understand why Trump has been described as isolationist, because both the expanded Trump corollary and this,
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Mark Farrington: pushback on China and Russian influence globally in a Cold War-like framework is not isolationist. It’s active, but it’s selective, you know what I mean?
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David Kilcullen: I would agree with that. I think the Trump administration has a degree of neuralgia about
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David Kilcullen: multilateral alliances, like NATO, that tend to enmesh the United States in collective decision-making processes, where it’s not in a position to pursue its own interests or to selectively engage. That’s one of the big beefs about NATO.
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David Kilcullen: coming from Trump people, irrespective of the money issue, which has been an issue back to, you know, the… the Nixon era. So that’s a… that’s an example of the type of alliances that the…
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David Kilcullen: the Trump administration doesn’t like, particularly.
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David Kilcullen: in the Western Pacific, and in the Asia Pacific, in the Indo-Pacific, what we’re seeing are a series of bilateral relationships, in which the US has much greater agency, much greater decision-making flexibility, and in many cases, these so-called alliances don’t actually do what the other party of the alliance thinks they do. Like, Australia’s a great example of that, right? Australians talk about
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David Kilcullen: the ANZUS Alliance as being a de facto security guarantee from the US to Australia. It’s no such thing, it never has been. It just says that the two parties will consult with each other, right? That’s it. So, the Trump administration’s basically not really changing the
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David Kilcullen: Letter of these alliances, but it’s changing the spirit in which
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David Kilcullen: they’ve operated in the past. But again, another action
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David Kilcullen: of the last few weeks that you may have already talked about, I don’t know, was that, just a couple weeks ago, the Trump administration gave the largest ever arms transfer to Taiwan.
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Mark Farrington: Yeah.
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David Kilcullen: $1.1 billion worth of weapons, in the midst of the Chinese having a very intensive war of words with Japan about Japan, upgrading its likely response to a move on Taiwan. So we’re seeing a generalized theme of the Trump administration trying to reestablish,
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David Kilcullen: deterrence to establish this notion of selective engagement on US terms rather than somebody else’s terms, and then…
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David Kilcullen: being… having a much lower threshold for engagement in its own region, and a higher threshold for interfering with other great powers in their own regions. And all of that is in the NSS, right? In the national security strategy from a month ago. So what we’re seeing, to some extent, is the…
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David Kilcullen: You know, the emergence of flesh on the bones from that document from a month ago.
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Mark Farrington: Excellent, yeah.
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Marvin Barth: I want to, ask, you know, we’ve talked a lot about the U.S. intent here. What about the other two great strategic powers here, particularly China, but also, to some extent, Russia, which, you know.
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Marvin Barth: the U.S, I think, is, you know, trying to peel away from China.
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Marvin Barth: You know, one… on the Russian front, one interesting implication of this, people talk about, oh, it’s an invasion for oil, or whatever, which I don’t really buy, but it is kind of interesting, if you think about it, that the U.S. already
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Marvin Barth: If you think that it has effective control, given pipelines and things like that, over Mexican and Canadian oil.
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Marvin Barth: plus the US does 22% of the world’s oil itself.
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Marvin Barth: has… You know, produces or has control of a third of the world’s oil production already.
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David Kilcullen: No.
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Marvin Barth: add in Venezuela, even though Venezuela’s small now, it could be a very large producer in the future. Plus, you’re establishing this precedent
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Marvin Barth: with the Brazilians, the Colombians, the Ecuadorians, the Guyanans, who you already effectively control, the Trinidad, all of that. You’re talking 40% of the world’s oil supply right now. That is a very powerful economic weapon to wield against both Russia
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Marvin Barth: the Iranians, even to keep the Saudis in line. It’s also potentially a weapon against importers like China.
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Marvin Barth: So one question, and I’m gonna go through these in a couple and let you take… pick whatever you want, because we’re gonna run out of time soon. The other is, is China.
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Marvin Barth: how do they look at this? And, you know, to the point of this area of suzeranity, does this give them greater flexibility? Also, you know, I’m sure that they would have used whatever excuse they could
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Marvin Barth: But the… the… there’s a lot of noise that the Chinese delegation visiting
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Marvin Barth: was effectively an unwitting participant in the, operation, because it helped them pin down where, Maduro was to do this, which…
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David Kilcullen: You know, is a pretty insulting move.
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Marvin Barth: And one, it does suggest to me that, A, the Chinese didn’t actually know this was happening, or, you know, obviously knew something was in the air, but didn’t know this specific operation. But the other is, what does this say to them?
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Marvin Barth: So, those are sort of two big questions. How should Russia be looking at this, especially given they are so dependent on resources and the U.S. is actively controlling a lot more resources through this process?
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Marvin Barth: And B, how does China look at this in terms of spheres of influence and also sort of the affront to them?
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David Kilcullen: So the Russians, I think, are,
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David Kilcullen: quite concerned about the impact of this on the Dark Fleet oil, transfers, which have been, part of the recent
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David Kilcullen: you know, pre-strike behavior by the task group down in, in the Caribbean over the past few weeks. And I think that, in terms of resources, the worry…
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David Kilcullen: for the Russians is that their ability to access, for example, Chinese or other sources of natural gas and oil is going to be limited. I think that’s less of a concern, frankly. I think…
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David Kilcullen: For the Russians, the… The more important issue here is that, the…
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David Kilcullen: So, you may be aware, Russia has quite a presence in Cuba, and including signals intelligence and a number of other things, and the big impact of disruption of Venezuelan oil flow in the region is to Cuba.
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David Kilcullen: And Cuba could very well, suffer significantly and have to make an accommodation with the US.
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David Kilcullen: As a result of this, in a fairly short order, in a matter of months, rather than longer term. For China, I think the issue is twofold, and there’s pluses and minuses.
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David Kilcullen: On the one hand, it’s gonna be very difficult for
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David Kilcullen: the US to go against China’s assertion of limited suzerainty over, countries in its region, including potentially Taiwan, when it’s just done the same thing in,
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David Kilcullen: in Latin America, and I think that that won’t stop the US from saying, well, this is different. But, I think we’ve already seen in the Chinese media
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David Kilcullen: an assertion that if this is okay for the US, then, you know, it would be double standards for the US to go against a Chinese move on other countries in its region. I think the nuance there is that…
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David Kilcullen: Trump didn’t invade Venezuela, he didn’t occupy it, he didn’t do regime change, but he did seize the head of state and impose policy changes and economic changes on
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David Kilcullen: the behavior of the Venezuelan government. That’s a limited option that some Chinese strategists have been talking about for a number of years. To the extent of people even saying, why are you even talking about invading Taiwan? This is crazy.
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David Kilcullen: we would turn the country into a smoking hulk, and it’d take us a generation to rebuild it. We need to go after a much more limited objective. So that’s one option, one issue for China, and I’d say a relatively positive one. The negative one is about Chinese presence.
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David Kilcullen: In the region. And again, this goes back to… John has spent…
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David Kilcullen: 15 years, really trying to build its presence in Central America and South America, gaining control over commercial assets and over infrastructure, looking at alternatives, port construction.
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David Kilcullen: At one point, they were considering another canal, a whole bunch of different things in the region, doing deals with people for, commodity, deals in yuan rather than dollars, you know, a bunch of things going on in the region, and now.
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David Kilcullen: Trump is very much pushing back on that and saying, no, that’s not acceptable, and we are going to be economically as well as, as well as in security terms, we’re going to be dominant in economic terms in, in the region. I think that does have significant negative implications for the Chinese.
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Marvin Barth: Yeah.
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Mark Farrington: David, I think that, one of the things that I was hoping is going to come out of this, you know, once the smoke clears from the military operation.
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Mark Farrington: is in order to prevent that precedent from increasing the odds of a military seizure of Taiwan, the U.S. should be emphasizing the Roosevelt corollary and the dollar diplomacy aspect, which was to intervene in unstable and falling regimes so that it doesn’t become a playground
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Mark Farrington: for external parties to come in and cause trouble in the US’s backyard. Taiwan is the exact antithesis of that. It’s, you know, it’s more successful, it’s more rich, it’s more stable than the mainland, so you don’t have that same pretext of intervention in order to stabilize a potential, you know, basing ground for your enemy. It would be the opposite.
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Mark Farrington: If they can make that point clear, they can hopefully block that precedent.
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David Kilcullen: I think that’s a great point, and I would also get back to something Marvin said, the…
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David Kilcullen: I think that this is not necessarily about increasing Venezuelan production, it’s about… nor is it about denying Venezuelan production to the Chinese. It’s about U.S. control over that production. So, you might find that…
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David Kilcullen: Trump now has a bargaining counter to say, hey, we’ll give you a great deal, right, on Venezuelan oil, and we’ll give you, all the oil you can stomach at prices that you find acceptable.
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David Kilcullen: But we have to be in charge of it, right? And that then, to your point earlier, Marvin, offers a bargaining counter for the rare earths and other things that have become a big source of Chinese leverage, right? So again.
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David Kilcullen: We… we are used to rhetoric that says that economic security is national security. This is Trump putting that into practice, and saying that we reserve the right to
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David Kilcullen: you know, use bombs and Delta Force to enforce economic warfare goals, right? While using economic goals to enforce our national security goals. And it’s a… it’s a…
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David Kilcullen: US adoption of a style of operating that it’s accused other people of doing for a long time. arguably the US has been doing it forever too, but now it’s explicit. So I do think it’s new, and although we often say, well, the rhetoric’s different, but the substance is the same.
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David Kilcullen: changing the rhetoric as… actually does bring a substantive change to how people behave, right, in the international system. So, and I think the other people that you’ve mentioned in passing that we need to watch is the Europeans, right? Because Europe’s been quite quiet on this, with the exception of the Danes over Greenland, and it’s almost like they’re struggling to figure out
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David Kilcullen: how to react here. And I think, you’ve seen some analysts
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David Kilcullen: in Germany and in Russia, saying, you know, the real loser here is actually Europe, because it’s now being excluded from a peace deal over Ukraine.
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David Kilcullen: and the possible future of Taiwan, and now the oil and energy systems that power the modern world, right? So, where does that leave Europe in this framework?
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Marvin Barth: Well, this is definitely something Mark and I… I think it was actually in our last discussion, Mark, where we’re… it was, because we were both saying, look, the risks of a serious European crisis have gone up massively since the NSS, and this is just another episode, because Europe is…
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Marvin Barth: As much as they don’t want to admit it, totally irrelevant to
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Marvin Barth: the geopolitical framework at this point. They don’t have any ability to project force anywhere significantly.
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Marvin Barth: they don’t have significant resources, and, you know, they’re falling behind in the technological battle. Europe really has taken a severe backseat for the first time in probably 500 years.
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Mark Farrington: Hmm. Yes.
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David Kilcullen: That’s an interesting take, and I think we would have to distinguish the EU from countries located in Europe, right? So, Poland, the UK, to a certain extent, playing…
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Marvin Barth: hope for the UK. I’m a resident and citizen.
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David Kilcullen: Yeah. Well, the UK has an extraterritorial or extra-European role because of its role in AUKUS, and because of its possessions worldwide, like territorial possessions. The other big European player that has that same level of extraterritorial role is France, right? So I do think there’s gonna be…
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David Kilcullen: exceptions, right? Or there are going to be differences. You know, France’s role in Africa has been under threat a lot lately, but it has, you know, it’s the largest European power in the Pacific, right? In terms of territorial possessions and military presence.
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David Kilcullen: Australia and France between them, own all the key sub-Antarctic islands, which are really important now for missile defense. You know, there’s a bunch of stuff where I think Europe will still be a player, but not as it has been, right? And the rhetoric of successive European… Sorry, US governments about the importance of Europe.
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David Kilcullen: is being, you know, gainsayed in a hundred ways by everybody from J.D. Vance to U.S. tech giants to the national security strategy to, you know, the discussion over Ukraine, and I think Europe needs to come to grips with
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David Kilcullen: its role in a new, more multipolar world order. And I’m not sure that we’ve seen that yet.
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Marvin Barth: Yeah, I just, I, I… we are rapidly running out of time. We’ll probably run over a little bit here, but, and I really want to get to the rebuilding phase, like, what, what comes next? But I just, one, quick
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Marvin Barth: Last thought on… You mentioned Greenland earlier. You also sort of alluded that
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Marvin Barth: Cuba is now going to be starved of oil.
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Marvin Barth: Who’s next, or is there a next?
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David Kilcullen: The place that I would watch, and I don’t think it’s a next exactly, is Colombia. So the current president of Colombia, Petro, has a very, or had a very close relationship with Maduro.
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David Kilcullen: He comes from a similar political background, he’s a former M19 terrorist. There are millions of Venezuelans in Colombia.
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David Kilcullen: In addition, the ELN, one of the… the National Liberation Army, a so-called narco-terrorist group, but actually a Marxist insurgent group that happens to also do drug trafficking, has major base areas in
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David Kilcullen: Venezuela, and also when the peace deal was put in place by the former president, President Santos, in Colombia, that resulted in a formal end to the war with the FARC,
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David Kilcullen: seven FARC so-called dissidentias,
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David Kilcullen: mobile FARC military groups refused to accept the peace deal, and some of them relocated some or all of their presence into Venezuela. So you… and there’s an argument amongst many
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David Kilcullen: analysts that, these aren’t really dissident FARC groups, they’re actually the FARC military reserve, as it takes part in electoral politics, but if it loses electoral politics, it’s got that as a backup. There is a May 2026 presidential election coming up.
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David Kilcullen: leading anti-Petro candidates has already been assassinated. The former president, who happens to share the same name, but is not a relative of the guy who was assassinated, Uribe, has been put under house arrest.
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David Kilcullen: by the Petro regime, sorry, Petro government, and there is a certain degree of concern in Colombia that this could be a pretext for a massive crackdown on
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David Kilcullen: any opponent of the left-wing tendency in Colombian politics ahead of that May presidential election. So that would be the one to watch in the short term. There are others too, Ecuador, in particular, and a couple other places.
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Marvin Barth: So, let’s go to the next topic, which is, what’s next? I mean, we’ve talked… you and I personally have talked about this in the past, that, you know, you’ve never had a failed state of the size
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Marvin Barth: and complexity of Venezuela. And in many ways, I think.
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Marvin Barth: It probably… its ability to maintain cohesion and some semblance of state
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Marvin Barth: Over the last several years has been a surprise. Certainly to me, I think… I don’t want to put words in your mouth, but I’m guessing probably to you as well.
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Marvin Barth: And… You now have…
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Marvin Barth: the Trump administration, obviously very interested in seeing it become a cohesive and stable and friendly, i.e. under their suzeranity.
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Marvin Barth: nation-state. That is a really, really difficult thing. You know, there’s all sorts of people who think, well, you know,
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Marvin Barth: Maria Carina Machado, you know, just needs to come in and take over and all this, and because somebody pulled a bunch of election buttons, this magically will happen.
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Marvin Barth: That’s not the way you actually run a government or build a state.
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Marvin Barth: How… what needs to happen here? What does the Trump administration need to do? What needs to happen on the ground? How is this going to be a success, Dave?
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David Kilcullen: Yeah, well, it may not be, right?
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Marvin Barth: If it’s going to be a success, how would that happen?
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David Kilcullen: And of course, if it wasn’t a success, that would give us an unbroken record of failure going back to World War II, so that would be, you know, the way to bet. But I think,
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David Kilcullen: the Trump team, and I, you know, I worked with Pete Hegseth when he was in the military in Afghanistan. I don’t know Marco Rubio, but I’ve read a lot of things he said, and I know people that know him well. J.D. Vance, you know, combat veteran from Iraq.
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David Kilcullen: One of the things that the Trump team are particularly allergic to is the notion of
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David Kilcullen: foreign wars of choice involving pro-democratic regime change and U.S. occupation forces on the ground, right? What they sometimes shorthand as forever wars.
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David Kilcullen: And they, with the exception of Gaza, but there’s always an Israel exception in US politics, right? With the exception of Gaza, there hasn’t been any appetite on the part of the Trump administration for putting any US troops on the ground. And I think that is still likely to be the case for Venezuela. So…
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David Kilcullen: what I think we’re seeing… is very limited.
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David Kilcullen: regime behaviour change being the goal, not regime change. Trump has already come out and dissed the chances of Maria Corina Machado coming back as president, said she doesn’t have the legitimacy or the support.
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David Kilcullen: She also has the prize that he wanted to have, right? The Nobel Peace Prize, so that ain’t gonna go well. So…
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Marvin Barth: He offered it to him.
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David Kilcullen: I know, but as would I have if I’d been given that prize, because she probably saw this coming, right? But I think the, most likely outcome is your personnel stay the same.
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David Kilcullen: Vice President Deli becomes president.
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David Kilcullen: maybe you back off a little bit on some of the socialist crackdowns. You certainly allow back in the big US oil companies, and you knock off the economic warfare and political warfare against the United States. As long as you make those changes.
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David Kilcullen: the Colombian… The Venezuelan military, and the…
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David Kilcullen: key lessons that people in the Trump administration have taken from our experience in Iran… sorry, in Iraq and Afghanistan, right? So, one of the big lessons is we shouldn’t have disbanded the Iraqi military.
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David Kilcullen: And sent them all home to become the source of the new insurgency. We shouldn’t have…
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David Kilcullen: Disrupted a secular regime.
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David Kilcullen: in Syria and in, Iraq, and allowed it to be replaced by a theocratic opponent, right? We shouldn’t have…
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David Kilcullen: Engaged in a massive generational
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David Kilcullen: nation-building effort in Afghanistan, which we turned out to lack the ability to pursue. So I think what they’re doing is they’ve taken a really significant appetite suppressant as a result of that negative experience of the war on terrorism, and what you’re likely to see is,
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David Kilcullen: what David Ignachev, you know, 20 years ago called Empire Light, L-I-T-E, where all they’re doing is, hey guys, we’ve got certain policies we want to see in place, we’ve got other policies we don’t want to see in place, there are some personnel changes we’d like to see. Other than that.
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David Kilcullen: You get to keep doing what you’re doing. And we’re not going to be promoting democracy in your country, nor will we be trying to engage in
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David Kilcullen: Regime change, and the quid pro quo is you guys get to keep your, you know, your pensions and your position, and keep running the country, as long as you make these small, you know, tributary or protectorate-style changes to your foreign policy.
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David Kilcullen: Again, you know, you’re dealing with a very proud people here in Venezuela.
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David Kilcullen: You may find some machado that says, no, we’re not gonna do that, or machismo, but, that’s…
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David Kilcullen: you know, not necessarily a given. You might just see people accommodating that in order to, get the benefits of what Trump’s offering them. Time will tell.
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David Kilcullen: For sure, we don’t want to get into a counterinsurgency. It would be a massive losing proposition. We can talk numbers if you want, but highly unlikely to succeed. And I don’t think it’s on the agenda for the US government either.
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Marvin Barth: You said that the Trump administration took these lessons from
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Marvin Barth: you know, Iraq, Syria, and Afghanistan.
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Marvin Barth: you know, you were actually critically involved in U.S. decisions in those three theaters.
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Marvin Barth: Do you…
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Marvin Barth: David Kilculin take the same lessons, or do you draw different lessons, and would you advise them differently?
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David Kilcullen: So, I’ve shifted my position on this since I was fighting in Iraq to now, but I think it’s very… I’ve always been an opponent of the idea of going into Iraq. I think that that was a unforced error.
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Marvin Barth: You did not use the F word.
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David Kilcullen: On the record.
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David Kilcullen: Hold on the record. But I think the, so I, as I’m on the record, I think that, the invasion of Iraq was an extremely serious, self-inflicted strategic error.
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David Kilcullen: Afghanistan was slightly different. There was a lot of international support for intervention in Afghanistan. When the US abandoned that effort and turned to Iraq.
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David Kilcullen: the Europeans and the UN and others stepped in via the mechanism of the Bond Conference and imposed, basically, a modernization and Europeanization agenda on the Afghan state.
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David Kilcullen: that tried to turn it into something that they had no mandate or local Afghan legitimacy to do. And that then led to, you know, 20 years of…
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David Kilcullen: of engagement in Afghanistan. I believe we could have succeeded in Afghanistan, I think we actually did succeed, and then the Biden administration threw it away, with strong help from the Trump administration, by the way, the first administration. So it wasn’t a partisan thing, it was a failure of will.
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David Kilcullen: In the United States. Iraq was never gonna work. Syria was never going to work. Libya, we didn’t even try to make work. So I think…
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David Kilcullen: The lesson there is
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David Kilcullen: invading other people’s countries, trying to restructure them, occupying them forever, even for a country with the unprecedented level of power of the United States, is just a bridge too far, and even if you can succeed in doing it.
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David Kilcullen: it distracts you from all these other things that you need to be doing. And in The Dragons and the Snakes, I talk about how we were so distracted by the war on terrorism that we missed and were not able to respond to.
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David Kilcullen: the rise of China and Russia. So, I… The dragons. The dragons, yeah. I fully support the…
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David Kilcullen: the lessons coming out of Iraq and Afghanistan without necessarily agreeing with the particular way that the Trump administration’s going about acting on those lessons. And I think this is a general theme on the second Trump administration generally.
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David Kilcullen: He is often react… his administration is often reacting to real problems that are genuine and need a solution, which the other party in power has failed signally to address, but that doesn’t necessarily mean that the solutions that they’re coming up with are the right solutions.
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David Kilcullen: It doesn’t mean they’ve thought them through, and it doesn’t mean that they’re going to have the stick-addedness to make those solutions work, right? So, I think USAID’s a great example, right? USAID, no one would have wanted to see USAID blown up and consigned to the dustbin of history in quite the way
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David Kilcullen: That it was stunned, but…
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David Kilcullen: the other side had 20 years to fix it, and failed to fix it, and most people agreed that USAID had all sorts of problems, right? So,
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David Kilcullen: Same’s true of healthcare, same’s true of tax systems, same’s true of deindustrialization, right? And arguably the same in a military sense is true here, that they’ve identified a real problem.
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David Kilcullen: But their actions may not necessarily solve it. So, you know, this is one of these ones where we need to perhaps, have another conversation in another 6 months and see how it’s played out.
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Marvin Barth: Whoa…
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Mark Farrington: I must say, if I can just jump in here for a second, Marvin, like, I hope that the lessons from Afghanistan and Iraq and Syria don’t frighten the U.S. off.
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Mark Farrington: from the mission that they’ve now, taken on. As Trump said, we own this now, we’re going to make sure after the… not so much sacrifice, but the risk of sacrifice, we’re not going to walk away. Because, I mean, Latin America is close enough
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Mark Farrington: culturally to America, and it does have sufficient history in democracy, and all of its constitutional framework is based on our same constitutional framework. And religiously and culturally, the similarities are there. You have a potential to actually succeed if you invest as much time and energy in Latin America as you did in the Middle East, you know?
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Mark Farrington: So I hope they’re not completely put off, because, you can just as easily get caught in a decade-long political quagmire as you can a military quagmire. And I think, given how high the populist sentiment and support is for
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Mark Farrington: people like Machado and people who have actually, you know, gone through the democratic process and been validated, Guido and Gonzalez, all of these, that the U.S. has to be careful not to lose all the hearts and minds of the people and all of the international support on this, simply because they’ve learned their lesson that nation building is a forever war path they don’t want to go down, because I think they’re…
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Mark Farrington: You can probably force through enough change.
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Mark Farrington: with the existing regime, exactly along the lines you said, but with a few more demands. Like, for example.
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Mark Farrington: restructuring the judiciary. You know, the Supreme Court was completely stacked, and that’s what started the constitutional crisis, and that’s what, you know, started the successive, completely false, democratic elections that Maduro oversaw. So if they could just
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Mark Farrington: Purge the court, for example, of all of the false appointees, and have at least one branch of government
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Mark Farrington: offering some checks and balances, and then, you know, make the same sort of deal with the rest of the regime. That might be enough to give it a fighting chance, and the democracy can emerge organically out of that.
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David Kilcullen: Yeah, so I think,
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David Kilcullen: you highlight a really good point, Mark, which is what you might shorthand as the danger of overcorrection, right? By the Trump administration. One thing to watch, and I don’t know what’s going to happen here, but one thing to watch is, is there a request or an insistence by the Trump administration that opposition political figures
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David Kilcullen: are allowed to return to Venezuela and cannot be targeted by the regime in the way that they have been. And also, is there a requirement
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David Kilcullen: or a request or a demand that, expat Venezuelans in the United States should have the right of return. And that may be…
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David Kilcullen: for… Illegal immigrants getting expelled, as we’ve seen with Trenda Aragua people from…
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David Kilcullen: The first year, but it might also be members of the Venezuelan diaspora who are Democratic and Republican and not interested in
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David Kilcullen: pursuing, criminal activity in the United States. Many of them are legally present, and… or almost all of them are legally present. Many of them are actually US citizens now, so that’s almost like a fifth column of…
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David Kilcullen: pro…
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David Kilcullen: Democrat pro-US Venezuelans, of whom there are now millions overseas, who could… you could insist that they have to come back and be, not targeted. Again, though.
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David Kilcullen: everything they’ve said so far suggests to me that that would be a bridge too far for the Trump administration, because they just don’t want to get drawn into the kinds of military demands on them that might be implicit in making that request of the Venezuelan government.
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David Kilcullen: So I think it’s.
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Mark Farrington: It’s certainly not a Phase 1 demand, but it can be potentially a Phase 2 demand, because as you’ve seen Trump always indicate.
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Mark Farrington: they’re gonna… they want private company money to come in and rebuild the oil sector. They’re gonna need private sector money to rebuild the economy as well. And all of that… all the Venezuelan diaspora will be that entrepreneurial energy that come with their own capital to reignite the economy. So I think the fifth column analogy you used is perfect.
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David Kilcullen: And for sure, the current regime in Caracas sees that too, so how they’re going to react to that, I think, is really important.
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Mark Farrington: You mean they see it positively, or they see it negatively?
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David Kilcullen: They see… they see it as a potential threat.
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Mark Farrington: That’s right.
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David Kilcullen: Oh, yeah.
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David Kilcullen: Anyway, much more detail will probably come out in the next few weeks, and there’ll probably be…
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David Kilcullen: the normal Trump triumphalism, you know, no one’s ever seen an operation like this. It’s unprecedented in history. Everybody says so, you know, it’s beautiful. But that’s what he said about the 12-Day War against Iran, and over the months since, it’s emerged that it was a lot less comprehensive.
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David Kilcullen: than initially claimed, right? So, let’s just see how it plays out, I think.
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Marvin Barth: Yeah, so on that front, you know, brass tacks here, like.
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Marvin Barth: You know, how long do they have?
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Marvin Barth: to actually
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Marvin Barth: Stabilize things, affect change, if they’re going to get this to go in a direction, and what are the things we should watch for?
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David Kilcullen: days to get their language right and come to some agreement with the, the current ruling clique in Caracas, and…
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David Kilcullen: probably weeks, no more than months, to put in place the kinds of deals we were just talking about over energy export, US presence, treatment of opposition groups, that kind of thing.
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David Kilcullen: And that’s because, when something like this happens, there is a temporary period of plasticity in the political system, where all kinds of things can take place and then congeal. This kind of shock wears off really quickly, and things go back to how they were, unless they’ve been
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David Kilcullen: jolted into a new, structure. So, it’s… it’s a fairly short period of time. And, the, the fly in the ointment there will be what happens with the actual criminal case in New York against, Maduro and his wife. So, I think, I would say…
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David Kilcullen: I’m hoping that we’re going to see clear statements this week, and probably by the end of this quarter, have some kind of structure in place. That’s if Trump doesn’t get distracted by something else, and go off and do that instead, right? So, and again, he doesn’t have a great track record of
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David Kilcullen: maintaining, attention on… on one issue. So let’s see how that… that plays out, too.
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Marvin Barth: Okay, and I don’t think we’re gonna… I mean, we’re already well over, so, I don’t think we’re gonna get to talk about markets, I just do want to mention
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Marvin Barth: one thing, which, I’ll toss out to both of you and ask you about. I mean, I’ve… I’m on the record as suggesting that the Genius Act is going to go down as one of the great foreign policy moves of…
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Marvin Barth: U.S. history.
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Marvin Barth: this seems like a perfect test case. Am I not correct here? I mean, this… you have a non-functioning economy, that is in need of money supply and payment systems, and, already has a high degree of absorption of,
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Marvin Barth: crypto, infrastructure.
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Marvin Barth: Your… your final thoughts, each of you?
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David Kilcullen: Let me defer to Mark on that. I mean, I think that non-traditional assets like Bitcoin and other crypto are going to be different from traditional assets, but, I’m also looking, as I think you guys are, to see a dollarization agenda be imp… or maybe even a currency conversion, be imposed on… on Venezuela. And what do you think, Mark?
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Mark Farrington: Yeah, I agree with that. I think that, you know, there should be part of the initial wish list that the Trump administration sends off.
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Mark Farrington: to Venezuela is that they just accept U.S. dollar as official currency in the country, like you have in Ecuador and El Salvador and countries like that, and that will just immediately eliminate the restrictions. There is a dollar shortage already in Venezuela, but
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Mark Farrington: you know.
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Mark Farrington: the crypto remittance path is well open, and I do think a lot of the Venezuelan diaspora, you know, have been waiting for this moment. They’ve been keeping their powder dry, they have capital, and there’s actually a lot of families who’ve had their private property seized and things like that, so, you know, there’s gonna be an impetus to get money in and to buy things up while they’re cheap, or reclaim what was historically yours.
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Mark Farrington: So, if they open the channels, I think the dollars will flow in, and that will help the economy tremendously. So, first fix is to legalize dollar as official currency.
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Marvin Barth: Well, and by the way,
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Marvin Barth: Dave, to your point, I mean, this… it’s not that you’d be using cryptocurrencies, you’d be using the dollar on crypto payment rails, so…
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Mark Farrington: The payment rails are.
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Marvin Barth: Stablecoins, all of those things are traded on Bitcoin, Ethereum networks, right? So, the whole point is that, and, you know, I’m sure you have plenty of anecdotes from the early days in Iraq.
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Marvin Barth: you know, how did you actually pay people with dollars? You actually needed physical dollars at the time, because you don’t have a functioning banking system, you don’t have a functioning payment system.
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Marvin Barth: But stablecoins built on crypto payment rails are already there, and are a very effective, payment system. This is the whole point of the Genius Act, right? It’s basically opening up
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Marvin Barth: A new dollar-based payment system for the world, and particularly for countries like this.
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Mark Farrington: Well, the public sector is still paid in boulevards, and that’s probably, you know, not going to change. What they can hope to do, is to close the gap with the black market, because the black market rate, you know, went ballistic, of course, in the last week, as you would expect, out of fear of the unknown, and as this starts to become a more known outcome, that will stabilize. But you need dollars to flow into the country.
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Mark Farrington: Addressing the boulevard, you know, valuation and hyperinflation is going to come down the track.
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Marvin Barth: Okay, well, look, this has been a long discussion, but I think a very fruitful one. I’m very appreciative of you coming on, Dave, and your patience to give us this much of your wisdom.
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Marvin Barth: This has been fantastic. Mark, thank you again, as always, for joining, and to all our, listeners and viewers out there, I,
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Marvin Barth: Look forward to you joining us again in two weeks. In the meantime, Dave, if people want to find out more about you, or reach out, where are the best channels for you?
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David Kilcullen: The two best would be, Cordillera, our consulting firm, Cordillera Applications Group.
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David Kilcullen: And it’s Cordiera, C-O-R-D-I-L-L-E-R-A hyphen apps.com. And then the other one is our new venture, Scenario AI, which is an AI-enabled
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David Kilcullen: wargaming platform that we’ve built for NATO and for other allies, but also businesses are using it to do capability assessment, and that’s, scenario AI,
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David Kilcullen: All one word, dot tech. T-E-C-K. T-C-H.
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Marvin Barth: Fantastic. Okay, great. Well, thank you again, Dave, and, Happy New Year to everyone. Best wishes for 2026.
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David Kilcullen: Thanks, and it was an honor to be on your podcast, Marvin and Mark.
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Mark Farrington: Thanks, David.
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