I have been working on a series of short diaries to provide background profiles of the countries in North Africa and the Middle East that are being caught up in the tide of revolutionary protest. I started with Saudi Arabia and its neighbors because I think that is a very critical hot spot. In looking at each country I have been struck by some very consistently recurring patterns and have set out on a quest to get a better conceptual perspective on them. This quest must first take us into what may seem like a digression into European history.
Those of us who live in the nations of the US, Canada, the European Union, Australia and New Zealand share a large spectrum of political values and institutions which can be broadly linked to enlightenment traditions and a common European cultural heritage. We are prone to think of these political values as the natural default state of humanity. As we follow the developments in North Africa and the Middle East many of us are prone to the expectation that reasonable outcomes for these movements would be the emergence of societies that look and function much like those with which we are familiar. However, out present institutions did not spring full blown from the Garden of Eden.
Medieval Europe was a shifting collection of small localized fiefdoms. The vast majority of the people living in the larger empires had no awareness of being a part of them. In a time of limited travel and communication, life for most people did not extend beyond the manor and the protection of the castle. The world was separated into three distinct classes, knights, clerics and peasants. People were linked by feudal relationships and responsibilities. This was generally accepted as a divinely established order that was universal and unchanging. The evolutionary path that brought us from that world to the present day was spread over many centuries.
Economic and political development moved hand in hand. There was a broad trend that change moved more rapidly in Northwestern Europe and less rapidly in the south and east. As economies became more complex they required more active and complex participation of citizens. This process was associated with greater political rights and participation. Industrial economies gave rise to a middle class along with technological change and an improved standard of living. The process was not smooth and automatic. On several occasions it resulted in revolution and civil war, as well as wars of competition between nations.
It was actually China that first developed ships capable of inter-continental ocean travel in the 15th C. Internal political conflict cause them to be destroyed. About a century later Europeans finally began to get the hang of it. As they began to build global trade networks they became enchanted with exporting their notions of civilization to the heaven savages. This provided a convenient justification for the development of colonialism and imperialist control. Those arrangements endured into the second half of the 20th C. The process of absorbing European political culture by colonial osmosis was not very effective.
Colonialism left the world with many troubling legacies. Many of the countries struggling with those legacies have become enmeshed in the neoliberal engineered network of globalization. That experience has taken different forms in different places. Here we want to look at a specific group of countries on the Arabian Peninsula. They have similarities in terms of geography, politics, religion and economics. Because all of them have economies that are strongly configured and constrained by global oil exports they can be characterized as rentier states.
Economic rent is typically defined by economists as an excess distribution to any factor in a production process above the amount required to draw the factor into the process or to sustain the current use of the factor. A recipient of economic rent is a rentier. Historically this term has been applied to people with excess funds to loan to others and then live off the interest from those loans. Political scientists and economists have come to apply the term to certain states.
Hazem Beblawi suggested four characteristics that would determine whether or not a state could be identified as rentier:
1. if rent situations predominate
2. if the economy relies on a substantial external rent – and therefore does not require a strong domestic productive sector
3. if only a small proportion of the working population is actually involved in the generation of the rent
4. and, perhaps most importantly, that the state’s government is the principal recipient of the external rent.
Beblawi, H., 1990, The Rentier State in the Arab World, in Luciani, G., The Arab State, London, Routledge, p.87-88
So what does all of this rather academic verbiage mean for our understanding of what is going on in the Persian Gulf? It basically means that because of oil the economic and political evolutionary processes that would take these societies along a path to modernity have been short circuited and stalled.
Historically this area was a battle ground of empires, the Persians, the Ottomans and in the late 19th and early 20th C the British. Hereditary monarchies were propped up as fiefdoms and later British protectorates. When they attained independence in the 1960s these autocratic forms of government continued in existence. The vast oil reserves had been discovered and developed in the 1930s and 1940s. In the 1970s and 1980s the rapid global rise in the price of oil made the Gulf monarchs richer than the legendary Croesus. There was no economic incentive for these states to develop the kinds of diversified economies that would provide expanding job opportunities for the citizens and to open up the political process to their active participation.
I am going to stop here with this general introduction to the topic. I will be doing additional diaries looking at how this rentier relationship has played out in such areas as labor patterns, political structure and international relations.