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Roundup #75: Checking in on the Bad Guys
Iran; China vs. India; Russia; Leaving California; Reduced hiring; Indian development; Wind energy; Science funding
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It’s a new year, so I’ve decided to change how I name these roundup posts. I’m retiring the name “At least five interesting things”, which is cumbersome and felt a little repetitive. Instead I’ll just call it “roundup”. I’m keeping the numbers for now, so people who want to link back to a specific roundup post can differentiate them.
Anyway, I’ve got a couple of fun podcasts for you, both about AI! The first is me and Liron Shapira on his podcast Doom Debates, talking about AI safety, and referencing my post on that topic from a few weeks ago:
The second podcast is with Jeff Schechtman, in which I make my case for techno-optimism and complain that Americans are too fearful of the future:
Anyway, on to this week’s roundup! Consistent with the theme of “Checking in on the bad guys”, let’s start with some items about the New Axis powers:
1. Iran’s chaos is partially economic
Everyone’s eyes are fixed on Iran’s protests and the regime’s brutal response to them, waiting to see if the Islamic Republic falls or manages to shoot its way out of this crisis. But it’s also interesting to take a look at the material roots of the unrest. Zineb Riboua has an article in The National Interest detailing some of the regime’s failures on the economic front. One key issue that relatively few outsiders seem to know about is the country’s water crisis:
Crucially, the regime’s failures are starkly visible in Iran’s accelerating water crisis, which has evolved from an environmental strain into a political fault line. A country of more than 90 million people is confronting its worst drought in over half a century, with collapsing aquifers, dried rivers, and water rationing spreading across cities and provinces. Instead of addressing decades of reckless dam construction and unsustainable agricultural policy, the regime has increasingly shifted blame outward. Iranian officials and state-aligned media have accused neighboring countries such as Turkey, the UAE, and Saudi Arabia of diverting rain clouds, and more recently have alleged that the United States and Israel are manipulating the weather.
Moreover, Iran’s water crisis directly contributes to prolonged power cuts that further intensify unrest. Power generation in Iran depends heavily on water-intensive infrastructure, leaving the grid vulnerable as reservoirs shrink. Chronic blackouts now disrupt daily life, turning infrastructure failure into immediate political anger and, alongside water shortages, accelerating mass unrest.
U.S. sanctions have also made a big impact. Iran has been forced into all kinds of alternative financing arrangements, and now sells most of its oil to China. This makes it a lot harder for Iran to pay for its military:
These constraints combined have produced a profoundly distorted budgetary structure. Iran’s national budget is effectively bifurcated between rial-denominated and crude-oil-denominated allocations. Because Iran cannot sell its oil through conventional financial channels, it increasingly uses oil as a substitute for cash, primarily to fund the security sector. The Ministry of Defense, for example, receives both rials and oil shipments, which it must then sell independently to finance weapons, operations, and support for proxy forces.
Sanctions have also forced Iran into a fairly classic currency crisis, with inflation spiraling out of control and causing all of the usual disruptions:
[I]nflation has reached crisis levels, with official data showing a rate of 42.2 percent in December 2025, up 1.8 percent from November, while food prices surged 72 percent and health and medical goods rose 50 percent year on year. Combined with a mismanaged water crisis, these pressures sharply raise the cost of basic necessities…[T]he erosion of pensions and savings forces households to abandon long-term planning and shift into survival mode…
Jared Malsin also has a good article in the WSJ about how the current economic unrest was triggered by a recent financial crisis:
Late last year, Ayandeh Bank, run by regime cronies and saddled with nearly $5 billion in losses on a pile of bad loans, went bust. The government folded the carcass into a state bank and printed a massive amount of money to try to paper over all the red ink…[T]he failure became both a symbol and an accelerant of an economic unraveling that ultimately triggered the protests…The co