Saudi upheaval may sow seeds of economic growth, liberalization

Saudi upheaval may sow seeds of economic growth, liberalization
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The news out of Lebanon is confusing: Prime Minister Saad Hariri abruptly resigned during a trip to Riyadh, Saudi Arabia earlier this month.

The people back home in Beirut were outraged by what seems to be a clear power play by the young Saudi Crown Prince Mohammed bin Salman, because it may precipitate another proxy conflict in the Saudi-Iran war that exists in all but name.

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Lebanon is a fragile country that is roughly one-third Sunni Muslim (closely aligned and funded by Saudi Arabia), one-third Christian and one-third Shia Muslim (closely aligned with Iran).

 

Is Prince Salman making a mistake? Should President Trump intervene, or at least say something about democracy and sovereignty? A little trust is in order, as well as a lot of context.

It’s worth remembering that Hariri lived for many years in Saudi Arabia before taking on the role of prime minister, so this situation has far deeper and interwoven complexity than it appears on the surface. It is also worth remembering that the U.S.-Saudi alliance is one of closest and longest in the region.

Saudi Arabia’s population of 31.4 million is less than half of Iran’s, but it’s GDP of $1.7 trillion is 20-percent larger. Yet, it is dangerously reliant on oil exports. Thus, it is worth highlighting how aggressively Prince Salman has moved to liberalize Saudi society internally.

Earlier this month in Riyadh, over 200 high-level officials, including many members of the royal family, were detained on charges of corruption. Like most societies throughout the Middle East, the kingdom’s economic development is hamstrung by arcane bureaucracies and inside connections, translated as corruption to outsiders.

Absent a shakeup, economic progress is impossible, so Prince Salman’s actions offer a risky but necessary reason for hope. The prince has been making waves — and meeting resistance — by pushing to allow women in the kingdom to drive automobiles.

We do not live in a world where progress is binary, though many Americans seem to think that a country is either autocratic (bad) or democratic (good). A more realistic history of how human rights improve appreciates that democracy is the end, not the beginning, of a society’s liberalization.

The beginning, as the economist Milton Friedman observed, is more mundane: a society that enforce property rights for all; encourages small business rather than state-backed conglomerates; and nudges forward on gender equality. The Saudis deserve our support.

What has been happening for decades now in the balkanized culture of Islam is analogous to the Christian reformation that Martin Luther started five centuries ago. Americans tend to view the region through the monochromatic lens of “terrorism” and therefore tend to wonder too simplistically about how to fight and defeat that.

It must be said that the fate of Islam will not be won or lost in the embattled mountains of Afghanistan, nor in Syria. It will be won (or lost) only if our allies in Jordan, Egypt and Saudi Arabia flourish economically, thereby creating a credible, tangible, accessible alternative to jihadism and Shia theocracy.

That is a battle with an outcome that remains gravely uncertain.

Tim Kane is the JP Conte fellow in immigration studies at the Hoover Institution at Stanford University. His most recent book is Total Volunteer Force. He has published scholarly research on immigration policy, national security, entrepreneurship and economic growth.