What 7 Disciplines See in Top Risks 2026
2026-01-05  ·  10 min  ·  Human Pace, The Audio Edition
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Hi, I'm T. I translate risk for people making capital decisions in clean energy and artificial intelligence infrastructure. This is Human Pace, the audio edition.

Today's piece is called What 7 Disciplines See in Top Risks 2026.

Every January, Eurasia Group publishes its Top Risks list. It is thoughtful, detailed work, written by people who think about geopolitics all day. Most of us don't but we still have to live with the consequences.

So I tried to do a translation exercise. I read all ten risks through seven different professional lenses: history, business, sociology, psychology, political science, insurance, and economics. For each one, I asked what each of the risk could mean for someone making a capital decision this year.

I'll do the count down from ten to one. Let's think about the questions because they are where the risk moves from someone else's headline to your own balance sheet.

At number ten: The Water Weapon. I read this one through history.

Water treaties have survived wars — until they didn't. When cooperation frameworks dissolve, shared resources become weapons.

Here is the translation for a risk manager. Leverage isn't just a financial or legal concept — it's a resource concept. Upstream control over water means downstream vulnerability, especially in a heating climate with no global governance architecture for basic human needs such as access to water.

So ask yourself: if access to water were constrained tomorrow, which assets or counterparties would feel it first?

Number nine is the zombie United States–Mexico–Canada agreement. This one reads like a business problem.

"Compromise" is a beautiful word — until it isn't. Agreements don't fail all at once. They decay through exceptions, carve-outs, and unresolved disputes.

The decay is the part worth watching. A zombie system still functions, although unpredictably. Capital can often plan around a clean break more easily than a system whose rules keep shifting.

Which leads to a short question with a long answer. Do you have visibility beyond your Tier 1 suppliers?

Number eight: Artificial Intelligence Eats Its Users. I read this through sociology lens because - doesn't it feel like we are going through the largest uncontrolled social experiment in human history? We just did so with social media over the last two decades. Now, enter AI.

Automation transfers risk — at speed, and possibly faster than governance can respond. So where are the human checkpoints embedded in your automated decision loops?

Number seven is China's Deflation Trap. I reach for psychology here, because consumer behavior tells us something the economic headline can miss.

Most headlines track gross domestic product, or GDP, and corporate earnings. Consumer psychology drives a large share of economic activity too. When home prices in China fall for more than four years and household wealth erodes with them, sentiment becomes a powerful force.

So watch the consumer, not just the company. Deflation is the opposite of inflation: prices going down instead of up. The risk of falling prices is debt servicing — earning less while paying the same obligations.

Here is the question I would put to a chief financial officer. In a deflationary environment, which fixed obligations in your business become harder to carry?

Number six: State Capitalism with American Characteristics. Political science gives us the useful lens.

Success increasingly requires not just market competitiveness, but political proximity to power. The "political risk premium" is no longer an emerging-market concept, isn't it? U.S. companies may now need to factor regulatory leverage — or the lack of it — and new revenue-sharing demands into their capital structures. The invisible hand meets the big and beautiful hand.

So have you formed a view on your own political risk premium?

Now, we're halfway through. Eurasia ranks these risks, so the weight increases as we move toward number one.

Number five: Russia's Second Front. History earns its place again.

Conflicts rarely stay contained. Conflicts create risk — and risk travels. They spill into supply chains, food prices, insurance markets, and migration. Which is the whole lesson in one line. Second-order effects matter more than headlines. Risk travels even when assets don't.

So what second-order risks would matter more to your business than the conflict itself? Pricing, insurance, logistics, or labor?

Number four is Europe Under Siege. For this, I use insurance lens.

Europe is a bloc of countries. The closest analogy, for risk managers, is perhaps managing a heterogeneous group captive. And anyone who has sat through a group captive renewal knows the tension. Low-risk members fear they're overpaying for high-risk members' losses. Staying strong together, or weakening simultaneously.

So there are two questions here. What is your upper risk tolerance threshold? And if three of your top five European markets face political paralysis simultaneously, what is your contingency?

Now we're inside the top three.

Number three: The Donroe Doctrine. Back to business lens.

As the author of Eurasia Group's Top Risks 2026 put it: "It's America's backyard first, not just America First." And the backyard is the entire western hemisphere which is to say, pretty big.

Conventional wisdom says diversification is one way to reduce the impact of concentration risk. But what happens when diversifying no longer brings a diversification benefit? So how concentrated is your growth strategy within one geopolitical neighborhood, one hemisphere?

Number two is Overpowered. Economics lens is most useful here.

Competitive advantage doesn't mean doing everything well. It means focusing energy and attention on what you do relatively better than others. The key word is relative, not absolute. Whoever scales what's getting cheaper gains compounding advantage.

And here is where economics turns into risk. Supply-chain concentration is the new sovereign risk and also a competitive advantage. When one nation controls more than 80 percent of midstream and downstream battery supply chains, that's not just business dependency. It's geopolitical leverage.

So I will put this one as a challenge. Are "buy from China", essentially cheap & now, vs. "build alternatives", essentially expensive & later — really the only two realistic choices?

Number one: United States Political Revolution. We end with sociology because institutions are social agreements. They hold only as long as enough people believe in them.

Rapid rule changes are a form of systemic risk. Confusion is not always a signal. Sometimes, it is a design. And that brings the last question, which is really the one sitting underneath all ten. Which of your risk assumptions rely on stable rules rather than stable outcomes?

When we step back from the individual headlines, we invite a larger pattern comes into view. Resources are becoming leverage. Agreements are becoming less predictable. Artificial intelligence is moving faster than governance. Supply chains and political power are concentrating. And conflict keeps traveling beyond the place where it begins.

The seven disciplines help me understand the key risks because each one shows a different part of the system. History sees patterns. Sociology sees trust. Psychology sees behavior. Economics sees incentives. Political science sees power. Business sees execution. And insurance asks who carries the loss.

That last question is the thread running through all ten.

We cannot know exactly how these risks will unfold in the year 2026 and beyond. We can identify which assumptions depend on stable rules, where exposure is concentrated, and how a distant headline could reach the balance sheet. That is translation over prediction. And for a risk management professional, that is the work. Recommend you check out the full report Eurasia Group's Top Risks 2026.

That's the piece. The written version is at cleanpowerwhisperer.ai.

If any of this is live in your own portfolio and you'd like to think it through with someone, you know where to find me.

Stay curious. Be safe. Be well.