Getting Cozy

Blake Hounshell takes a look at George W. Bush getting friendly with King Fahd and writes, "if you're a gasoline-consuming American, you're deeply complicit in this marriage, too. So laugh all you want at Bush, but he kisses Saudi cheek for thee—just as U.S. presidents have done for decades. There's nothing particularly unique about Bush's relationship with the Saudis." Justin Logan vigorously dissents.

I'm with Justin here. It's true that Bush isn't unique in this regard, but a very broad swathe of the American political elite has a level of personal friendliness with vicious Arab dictators that's totally unjustifiable in terms of the basic politics or economics of oil. The United States has what I'd deem an unduly chilly relationship with Venezuela at the moment, but the oil still flows and Citgo stations are still around. The process by which oil-rich states in the Persian Gulf export oil to oil-consuming states is a business arrangement for mutual advantage driven by the exchange of money for fuel. Maintaining it requires us to, yes, not deliberately launch any massive destabilizing operations in the region.

But it doesn't require our policies to be especially friendly to the regimes at hand, and it certainly doesn't require the unseemly degree of friendliness that you often see. At gatherings of the great and the good, one often sees some Arab princeling or queen treated as the equivalent to an entrepreneur or a democratically elected politician, and there's just no reason to do that.

Comments

But there is a reason - not a good reason, but an important one.

These leaders are not just autocrats; they are also old-style aristocrats, for whom personal relationships are part and parcel of effective politics, and for whom a reputation for nobility is an important thing.

The reason that presidents form such kissy-kissy relationships with these guys is to build up a reserve of good will that they can then draw on when they appeal to them to pump more oil; obviously, these calls run contrary to the leaders' self-interest, but they appeal to their sense of generosity and magnanimity. And of course, if they can just persuade the sheiks to do this, none of their underlings is going to question them.

In the long run, then, every kiss on the cheek is potentially worth billions of dollars to the American consumer. Not a bad return on investment, then.

Posted by lampwick | January 15, 2008 3:47 PM

Right, except the "or queen" part. The only Middle Eastern queen who has any status in the US at all, as far as I know, is Queen Noor of Jordan, who's not the equivalent of a Saudi prince on any level at all. In fact the lack of any political role for even the most elite women in most of these countries is one of the reasons this whole relationship is so troubling.

Posted by lemuel pitkin | January 15, 2008 3:49 PM

While some of this is collective hypnosis, the probably better explanation is the old double standard. Right-wing dictators, good! Lefties, bad. Of course, traditionalist oligarchies tend to see themselves as good, so that shouldn't surprise us cynical peons.

Posted by walt | January 15, 2008 3:49 PM

Bush's love for the Saudis isn't based on policy. It's based on the Bush family's traditional connections and the assurance that come Jan. 2009 he will be making millions of dollars off business deals, speeches, and other cozy arrangements with his elite muslim friends in Saudi Arabia.

Posted by Helter | January 15, 2008 3:49 PM

But it doesn't require our policies to be especially friendly to the regimes at hand

Yes it does if you want the petrodollars to come back to the US as payment for arms. Chavez seems to be more interested in spending his money elsewhere so that also partly explains the chilly relationship with him.

Posted by empty | January 15, 2008 3:50 PM

My dad and I were just talking about how insane it is that right-wingers act as if it were morally reprehensible for Citgo to buy oil from Venezuala, when alternatives are places like Saudi Arabia. Among oil-producers, Venezuala seems fairly democratic; granted, perhaps the current Venezualan regime has an authoritarian streak worse than that of Brazil, Norway, or other democratic oil producers, but I'm not sure that the Chavez's authoritarianism is anything that wouldn't be out of place coming out of the mouth of David Addington or John Yoo.

Posted by Julian Elson | January 15, 2008 3:52 PM

Matt,
King Fahd is dead. I think you meant Abdullah.

Posted by Grunt | January 15, 2008 3:54 PM

Someone needs to explain to bush that jawboning and rump swabbing are two different things.

Posted by john o. | January 15, 2008 3:57 PM

The fact that he's hobnobbing with a corpse is the the scariest part of all.

Posted by Dan | January 15, 2008 3:57 PM

How did Michale Moore put this? 8 billion dollars buys you a lot of love, and that is something what the House of Saud owns in America. They own chunks of Disney and NewsCorp, Yaslem bin Laden owns a chunk of GE/NBC, and as we know, they are currently bailing out some of our largest financial institutions. You can't get uppity with your bankers.

Posted by Alice Marshall | January 15, 2008 4:03 PM

Seriously though, the economic relationship b/t US and Saudis goes much deeper than simply buyer and seller of oil. Most importantly, the Saudis have long been the safety valve on world oil prices - sometimes to their detriment - by increasing their daily output upon US request.

And they've acted in a somewhat similar capacity with respect to the US economy, buying up gold-plated weapons systems or infrastructure upon US request. All we have to do is ask and they'll spend a couple billion to buoy a rocky sector.

To say nothing of longterm shared strategic goals, like not letting the vocal minority over there horn in on any of these processes. FWIW, Saudi have been very cooperative over the past decades.

Posted by Dan | January 15, 2008 4:19 PM

One word: Banks.
Two words: Investment Banks.

Is there a difference? Increasingly, no.

The genesis of US relationships with the Arabian Penninsula is oil, gas, and natural resources. How can the US help them get it out of the ground at low cost allowing them to reap the most reward AND how do we get them to place that reward back into the US economy.

The influx of cash into major Wall Street banks is just the latest blip on the world's financial radar. For about 40 years Arab wealth had been trying to acquire portions of the US Banking sector. It wasn't legal. So they hired crafty operators to work around the law. Read anything about BCCI lately? How about Khalid Bin Mafouz?

You can credit Jack Philby, an Englishman no less, for selling the Saudis to the United States instead of his native England.

Posted by Gabriel Sutherland | January 15, 2008 4:26 PM

There is a strong symbiotic relationship between US military and oil companies (sponsoring Bush and other presidents and other politicians) and the Saudi oil magnates. Of course he kisses Saudi cheek, he probably sucks Saudi dick as well; that's his job, that's what he is paid to do.

Posted by abb1 | January 15, 2008 4:28 PM

"There's nothing particularly unique about Bush's relationship with the Saudis."

Wow, so every recent president has been business partners on private side deals with the Saudi Royal Family?

And Grunt, the Kings name is Abdallah.

Posted by Davebo | January 15, 2008 4:32 PM

I don't think America needs any favors from Saudi Arabia, but Bush, Cheney, and their oil CEO friends do.

Just to be clear, the kissing and hand-holding does offend me, but no more than seeing an American politician bow to Queen Elizabeth offends me.

Posted by Gary Sugar | January 15, 2008 4:32 PM

At gatherings of the great and the good, one often sees some Arab princeling or queen treated as the equivalent to an entrepreneur or a democratically elected politician, and there's just no reason to do that.

Not sure what you mean by shouldn't be treated the same. To treat one head of state differently from another head of state would be counter productive (and diplomatically unacceptable). What I think you mean is that we shouldn't be all cozy-cozy with unelected kings/princes. Ultimately our true allies are countries that share our liberal democratic values. Saudi Arabia can never really be a true ally since we hardly have anything in common. It is just a relationship of convenience.

Posted by 2cynicalbyhalf | January 15, 2008 4:33 PM

We will never learn. Our support of right wing thug dictators since WW 2, has brought nothing but one bloody revolution after another -- stretching from South America around the globe to the Middle East.

Whether the rationale was containing communism or cheap accessible oil, the end result is usually a populace who has had enough --rises up and hangs the despots and burns effigies of American Presidents.

And when you strip away the stated reasons of national security or some phony moral rectitude, the end product is a destroyed country for a few more rich people like the money grubbing Carlyle Group.

It's only a matter of time, until the same thing happens in the greater middle east and it won't be pretty when it does.

Posted by nightjar | January 15, 2008 4:35 PM

Heck, maybe it is indeed Abdulla!

I deserve it for relying on the CIA. But I really thought they could at least get the King's name right.

Posted by Davebo | January 15, 2008 4:35 PM

Matt, the Saudis are absolutely the only oil producing nation with surplus capacity at this point.

Therefore, if there is a shock anywhere - terrorist attack, refinery accident, natural disaster - Saudi Aramco is the only supplier that could pick up the slack.

To put this in another way, they are bastards, but they're working miracles to keep the US from seeing $4, $5, $6 per gallon petrol.

We *have* been trying to deal with other people, like the Nigerians, Brazilians, even Chavez's people. Obviously, we'd love to buy from Norway. But these four together couldn't make up for Saudi Arabia, even if we bought every drop.

Until we find a way to cut petrol consumption, we're going to be lining up to kiss the House of Saud.

Posted by Greg | January 15, 2008 4:38 PM

"It is just a relationship of convenience."

This is true. But the reason why it is true is because the US-Saudi relationship could one day migrate into the China-Saudi relationship. So while it's not great that we have to continue the charade, the opportunity costs are likely much worse.

Posted by Gabriel Sutherland | January 15, 2008 4:38 PM

I will say this from first hand experience.

Abdullah's Exec 747 makes Air Force One look like a Southwest Airlines 737.

Posted by Davebo | January 15, 2008 4:40 PM

Lemuel - what about Queen Noor's successor, Queen Rania? She is a) really hot; and b) shows up on American talk shows fairly frequently.

Posted by John | January 15, 2008 4:44 PM

"Wow, so every recent president has been business partners on private side deals with the Saudi Royal Family?"

At least since Carter, every American President (and often their cabinet members) have had "side deals" in one manner or another. Jimmy Carter still gets use of Prince Bandar's Colorado ski house for his extended family whenever he likes.

Posted by Fred | January 15, 2008 4:46 PM

John: You're talking about Jordan. King Abdullah II can do whatever he wants whenever he wants. His powers are modeled after the House of Windsor.

As far as I have read, the Queen's in the Hashemite Kingdom have no real power at all.

Posted by Gabriel Sutherland | January 15, 2008 4:47 PM

In Tucson I have met a few sons of the Saudi elite at gold courses ,topless bars and rock clubs.They are pretty good guys and don't seem a threat to our way of life.Our topless dancers do more to cement our relationship with the next generation of corrupt dictators than that idiot Bush.

Posted by jerry | January 15, 2008 4:55 PM

Matt,

Your pal Justin says "no amount of ‘get tough’ rhetoric or ‘pretty please’ diplomacy has ever affected OPEC production decisions, despite what American politicians would have you believe."

I guess I'll give you a "bye" because you can't possibly remember the 70s. However, it should be noted that in fact the Saudis decided to quadruple the price of oil in 70s based purely on political decisions. So that kind of poops on Justin's theory, and yours along with it. Perhaps you two should google "oil shocks 70s Saudi Arabia".

Posted by freddiemac | January 15, 2008 4:56 PM

It's true there's something unusually obsequious about the Bush family's treatment of the House of Saud, but coziness definitely is the norm, e.g.:

"The royal family of Saudi Arabia gave the Clinton facility in Little Rock about $10 million, roughly the same amount it gave toward the presidential library of George H.W. Bush, according to people directly familiar with the contributions."

Washington Post
Clinton Library Got Funds From Abroad
12/15/07

But, contra Ygelsias, the reasons behind this particular special relationship are quite justifiable, in that as the world's "swing" producer (i.e. the one with excess capacity to turn on and off) the Saudis not only control the volume of oil but the price. Mighty handy friends to have in an election year, e.g.

"The White House Monday declined to comment on a report in a new book by journalist Bob Woodward that a Saudi Arabian ambassador had promised the Bush administration that it would lower oil prices to help boost the U.S. economy in time for the November presidential election."

MSNBC
Did Saudis assure Bush on oil prices?
4/19/04

The really interesting question is whether this geopolitical/familial tete-a-tete will continue once the Saudis run out of spare capacity, which will happen shortly.

Posted by Peter Principle | January 15, 2008 5:04 PM

Another tangent here from Justin's wildly stupid post. He references his justification that the Saudis don't adjust production for political purposes from an article that states "Adjusting for inflation, oil prices in 1973 stood at $90 a barrel. So we've got a long ways to go before prices approach those of the 1970s in real terms." Of course oil cracked 90 dollars a barrel weeks ago. Matt, let this be a lesson to you; check your sources.

Posted by freddiemac | January 15, 2008 5:08 PM

"Until we find a way to cut petrol consumption, we're going to be lining up to kiss the House of Saud."

One nation did do this. Japan. Although, they weren't buying from the Saudis.

Right around the time of the oilquake, OPEC asserting more control over the price of oil, Japanese car companies started targeting the American automobile market with low cost, fuel efficient vehicles. Their sales would need a few extraneous market forces, Yom Kippur war and the oil embargo, as an assist to really get them going in the United States, but here they are 30 years later about to become the dominant auto maker IN THE UNITED STATES.

Posted by Gabriel Sutherland | January 15, 2008 5:11 PM

Slightly OT, but the only full-service gas station in my rather large urban area is a Citgo. Fix a flat, new battery, whatever. This station has saved me lots of time and money. Exxon and Gulf are basically bodegas with gas. Is this the norm?

Posted by magisterludi | January 15, 2008 5:12 PM

Magister,

That's true where I live in Westchester County, and also by the University of Chicago, where I go to school.

Posted by Greg | January 15, 2008 5:21 PM

Another tangent here from Justin's wildly stupid post. He references his justification that the Saudis don't adjust production for political purposes from an article that states "Adjusting for inflation, oil prices in 1973 stood at $90 a barrel. So we've got a long ways to go before prices approach those of the 1970s in real terms." Of course oil cracked 90 dollars a barrel weeks ago. Matt, let this be a lesson to you; check your sources.

Of course, this article that Justin references was written in 2000, when prices did have a ways to go. And the rest of that article backs Justin's point. So I'd say the source is legit. You can take issue with it, but it's certainly not ammunition for the "smug game" you appear to be playing.

Posted by Drew | January 15, 2008 5:26 PM

Drew,

While I didn't notice that the article was written in 2000, my general assertion that the Saudis have a history of adjusting the price of oil for purely political reasons still stands, hence my smugness. And the issue with 90 dollar a barrel oil is that we are inching towards historically high prices, adjusted for inflation. We are past 1970 prices, we are headed towards 1981 prices. The fact is that the article's prognostication was off. The Saudis can just as easily dump production and spike oil prices today as in the 70s; there is no excess supply short of strategic reserves.

Posted by freddiemac | January 15, 2008 5:38 PM

freddiemac,

That wouldn't hurt us anywhere near as much as the Gulf pricing their oil in Euros or Yen.

Then we'd be well and truly fucked, since it's our unique advantage that these states want dollars for their petrol.

Posted by Greg | January 15, 2008 5:52 PM

Greg,

I've heard this assertion that pricing petrol in Euros would be very bad for the US, but never had it explained in detail. Can you elaborate or send me some links (not via email, that is just a dummy addy). Thanks.

Posted by freddiemac | January 15, 2008 5:58 PM

freddiemac,

Unfortunately I'm at work right now, and I have an Econometrics problem set to do tonight (oh how I love you, University of Chicago).

However, I'll do my best to post either tonight or tomorrow, so check back at this thread for the explanation-plus-links.

-Greg

Posted by Greg | January 15, 2008 6:02 PM

The Saudi's decision to develop their oil resources as fast as possible and pump as much oil as possible after the first oil shock was the most momentous economic decision of the last 50 years. That decision saved, intact, the entire structure of the post WWII economy and kept in place the same economic elites in the West.

It was not a slam dunk economic or political decision on their part to say Geronimo. By perpetuating global shortage after 74 which they easily could have done by just ramping up slowly their output they could have made a good fraction of absurd money they did after and allowed them to keep the money flowing for much much much longer.

Now I suppose they considered if they antagonized the West they thought that we might just come in and take over the oil but beyond that it's difficult to find a good rational for what they did.

They became the full partners of the elites by keeping the cheap energy game going so of course our political and economic elites will kiss their rings or asses or anything else they want kissed.

When the history of the age is written the Saudi decision must fill a big chapter for everything from global warming to the looming energy/economic crisis now unfolding to the ability of the corporate elites to expand their power unchecked all were founded upon cheap oil.

Posted by rapier | January 15, 2008 6:03 PM

Venezuela didn't stop buying our arms so much as the Administration stopped sales to punish Chavez' moves to reverse ten years of privatization of telecom and oil industries.

As I recall, King Faud and his family were screwing us to the wall in '73, until Kissinger pointed out to them that the US Armed Forces were running out of juice, and that Nixon wasn't going to stand for much more.

Posted by cmholm | January 15, 2008 6:03 PM

"I live in Westchester County, and also by the University of Chicago, where I go to school."

Thassa long commute.

Posted by WTF | January 15, 2008 7:01 PM

In a q and a with David Broder, today - I love them because there is nothing like having a q and a with the stupidest man in D.C. - save the president - Broder reproached some smart ass questioner like this:

"Dallas: Mr. Broder, what is your take on Bush wanting to spread democracy in the Middle East, but being unwilling to confront Saudi Arabia, which has one of the worst human rights records around, and which recently flogged a rape victim? If he is so hellbent on spreading democracy, why doesnt he push it with them instead of Iran?

David S. Broder: It perhaps has come to your attention that we draw large amounts of oil from Saudi Arabia and stiill have military bases in that country. "

Of course, you can't expect Broder to keep up with the fact that the U.S. acceded to Osama's demand and moved our military out of Saudi Arabia in 2003. But you do have to wonder how stupid the elites in D.C. think the Arab masses are. The president goes there, talks up democracy, war with Iran, then buddies up to the House of Saud - meaning, democracy is great except when it inconveniences the U.S. They actually think a foreign policy dedicated to broadcasting this message of double standards and hypocrisy is a good idea, and are puzzled why Bush isn't carried on the shoulders of cheering crowds.

Ah, the imagination deficit of the D.C. elites - so huge, you could almost plug a bank run with it.

who asked where was the democracy talk when Bush went down to Saudi Arabia because

Posted by roger | January 15, 2008 7:06 PM

Let's remember that these personal relationships also end up resulting in things like a number of Saudis being spirited out of the US after 9/11 while all other planes were grounded.

And despite Richard Clarke's demurral that these guys were all innocent - or at least not obvious suspects, there are a lot of questions about that move that are unanswered.

George Bush Sr.'s connections with the Carlyle Group and their connections with the Saudis should be simply unacceptable in terms of US national security, as should his son's connections. That alone should have eliminated Bush from consideration as President back in 2000.

And none of this cynical "well, we get cheap oil from it" should offset that. We don't need cheap oil, we need at the very least market-priced oil (in order to have a market not controlled by political currents unrelated to the market) and preferably significant oil independence.

The latter meaning instead of spending a trillion dollars to seize Iraq's oil, we should have spent that on oil independence. Simply investigating the extraction of shale oil by some sort of nanotech process probably would have paid for itself quickly even if it took the next ten or twenty years to develop it.

Posted by Richard Steven Hack | January 15, 2008 7:52 PM

To say nothing of longterm shared strategic goals, like not letting the vocal minority over there horn in on any of these processes. FWIW, Saudi have been very cooperative over the past decades.

Posted by Dan | January 15, 2008 4:19 PM

a) the "vocal minority" is not the minority. The Saudi royal family is the minority in Saudi Arabia.

b) And as for keeping the rest of the country under control, just where did all the 9/11 hijackers come from anyway?

It's really strange that we've allowed ourselves to become the military of Saudi Arabia, esp. considering how despised America is in that country.

I don't have an answer to the fact that we are so dependent on Saudi Arabia. But let's not pretend this is a good state of affairs.

Posted by Whispers | January 15, 2008 8:45 PM

So what's up with the focus on "Arab" dictators? Got a secondary agenda, perhaps?

Posted by MB | January 15, 2008 8:58 PM

When South America had puppet governments installed by the US, the average citizen went about their daily lives.

What will it take for people to realize we have a puppet government installed by Saudi Arabia?

Posted by Harry R. Sohl | January 15, 2008 9:22 PM

Where is Don Williams hiding? How come he isn't here blaming the Bush suckup to the Saudi princes on Haim Saban?

Posted by SLC | January 16, 2008 8:01 AM

someone has probably mentioned this above, but Bush was making nice with King Abdullah not the late King Fahd.

Posted by Robert Waldmann | January 16, 2008 8:58 AM

I'm generally with Justin here, too, but I think he makes a slight logical error (or perhaps just an unstated, and not quite innocuous, assumption) when it comes to the question of stability. The US effectively subsidizes the defense of Saudi Arabia. To the extent that this subsidy has an effect, it benefits oil consumers by making the region more stable (which is not to say it is necessarily worth the cost to the US). Justin Logan seems to argue that the subsidy has no effect at all, that if the US were to stop providing security guarantees to Saudi Arabia, the Saudis would construct an equally effective defense for themselves. In economic terms, he is assuming that the Saudis' demand for defense is perfectly inelastic. I doubt that. The royal family faces various tradeoffs -- for example, should it, on the margin, spend its money on defense or should it spend money on ensuring a comfortable escape if its defense should fail? To the extent that the Saudis' demand for defense has some elasticity to it, the effective US subsidy reduces the risk of an unstable event in the region and thus benefits US consumers (though, again, it may not be cost-effective).

Posted by knzn | January 19, 2008 2:31 PM