In this episode of Intelligence Matters, host Michael Morell interviews Bradley Hope and Justin Scheck, reporters for The Wall Street Journal and co-authors of Blood and Oil: Mohammed bin Salman’s Ruthless Quest for Global Power, about the leadership style and strategic decision-making of Saudi Crown Prince Mohammed bin Salman (MBS). Hope and Scheck offer their assessment of the “dichotomy” of MBS, explaining how he has behaved as both a great reformer and ruthless dictator. They also discuss his likely awareness of the murder of dissident Jamal Khashoggi, his views on political reform, and attempts to diversify the Saudi economy.
- On bin Salman’s reaction to Killing of Jamal Khashoggi; JUSTIN SCHECK: “I think he was very surprised by the outrage and by the fact that people in these other countries that he considers as important were going to harp so much on the death of one Saudi citizen. This is a Saudi citizen he viewed as a traitor. ‘Why is this such a big deal?’ He told someone, he blurted out, ‘Oh now the world sees me as a journalist killer.’ His image is very important to him and because he’s not the king yet, he is the Crown Prince, and creating this image of someone who is fit to be king is very important. He was extremely concerned and surprised that he is now defined in the eyes of many foreign leaders as the guy he who killed the journalist.”
- Being “Allergic” to Political Reform: BRADLEY HOPE: “Mohammed bin Salman, despite being seen as a reformer, in the Western media and also among Saudi youth, he’s completely allergic to anything close to political reform. I’ve never in any of my reporting heard of him having anything close to a discussion of political reforms . . . He is completely politically illiberal, but he’s socially liberal. And that is something that everyone needs to know when they’re trying to think about Mohammed bin Salman.”
- Future of Economic Development in Saudi Arabia; JUSTIN SCHECK: “If he does focus on economic development, there are huge risks. If Saudi Arabia does not end its near total reliance on oil revenue, there’s not really a great future for it. It’s hard to envision the future of a country that doesn’t have a great source of revenue, has not enough fresh water for its people, virtually no arable land. He’s talked a lot about how he’s going to do that, but so far the things that we’ve seen him do to get to a real economy haven’t been effective. Investing close to 50 billion dollars in foreign tech companies hasn’t produced meaningful dividends for the kingdom. But beyond that, it hasn’t produced a clear roadmap for how those tech investments are somehow going to fuel that economy.”
Intelligence Matters- Bradley Hope and Justin Scheck
Producer: Paulina Smolinski
MICHAEL MORELL: Congratulations on your book. It’s terrific. Its title is Blood and Oil: Mohammed bin Salman’s Ruthless Quest for Global Power. It has two qualities that I look for in a great book, which is it’s about a very important topic, and it’s very interesting and easy to read. Let me start by asking why you decided to write the book?
JUSTIN SCHECK: In 2016, we were based in London. We’re both reporters for The Wall Street Journal. And I had been covering energy. Bradley had been covering white collar crime, financial crime. Saudi Arabia was a place we weren’t really that focused on because it had been for decades an inward looking country that pumped oil, sold oil, used the proceeds to pay for its own priorities and kept stability in the region and in oil markets. It wasn’t a place where there had been change for decades. All of a sudden, this young prince erupted onto the scene. This country, run by old men all of a sudden had a very young man who was in charge and he was doing very ambitious and aggressive things.
The thing that got us involved was he promised to take the Saudi state oil company, which is the world’s biggest company, public in the world’s biggest ever IPO. That was of huge interest to The Wall Street Journal. We started digging into this question of what is the oil company? What is Saudi Aramco? And from there, we got into writing about the government and then the royal family and then inevitably to Mohammed bin Salman, who is the the most important and dynamic member of the royal family. And after a few years, we got to the point where we realize there was a bigger, deeper, more, more insightful story to tell that would be a book which naturally went in that direction.
BRADLEY HOPE: I’m a former Middle East correspondent, so I have a little bit of an extra element. A lot of Middle East correspondents, they start their careers in Beirut or Cairo. But I started in Abu Dhabi and that was a huge experience for me. I really became fascinated by these Gulf states, the differences between them, the differences between the members of the royal families and how they all fit into the equation.
For most of my time that I was in the region, I was first in Abu Dhabi, then I was covering the Arab Spring from Cairo and Libya. But Saudi Arabia didn’t really figure for me as a major area of focus. It was so frozen in time. We always regretted having to travel there during those days. The thing about Mohammed bin Salman, his story is a great way to understand the history of the country, to make the whole history more fascinating, now that he’s sort of breaking it up, breaking it into pieces. That was another kind of journalistic opportunity that we had.
MICHAEL MORELL: Given the subject matter, how much did you guys worry about and do you worry about the safety and the security of the sources who talk to you about the book?
JUSTIN SCHECK: It’s a really good question and that’s actually the right question. We’ve gotten a lot of questions about the safety of reporters, which is less of an issue. But the safety of our sources was a constant source of concern, partially because there’s a well recorded recent history of Saudi Arabia and other Gulf states using high tech surveillance, even with people who are not in the country, to monitor their communications. And there’s also a well recorded recent history of people who are viewed as disloyal to Mohammed bin Salman being imprisoned or kidnapped or worse. It was a constant source of concern for us. And we were very careful to use encrypted phone apps and technology to the extent that helps, but always with the knowledge that, as has been demonstrated, no matter how good your encryption is, if someone is able to get access to the endpoint, to either person’s phone, the encryption doesn’t really do anything.
When it was possible, we met in person with people. That’s counterintuitive. That it’s more secure. But that was one of the advantages to being based in London where you could be in a city where there isn’t a surveillance capability, the same way that you’re going to have in the Middle East. You can meet in person. And I was meeting with people in remote pubs late at night in far off the grid parts of London, because that was safer than communicating with someone when they were in the Gulf over our phones.
MICHAEL MORELL: Talk a little bit about who Mohammed bin Salman is, what’s his personality like, what makes him tick, what drives him, what does he fear? In short, who is this guy?
BRADLEY HOPE: When we started our research, we both looked at each other and said, ‘Let’s start from scratch on this,’ because there was such a parade of news and it was so high speed. There was a lot of exaggeration or information campaigns going on. It was easy to have a caricature vision of who Mohammed bin Salman was. He’s an incredibly unlikely person to emerge as the would be king of Saudi Arabia, because in so many ways, he doesn’t fit the cast. He’s not somebody that had an illustrious career, even in business or in university or in anything, really. He was really just somebody who is very close to his father.
One of the key things to understand about him is that early on he developed a heuristic that he uses time and time again in every situation. If presented with a problem, he has different opportunities to go forward. One of them would be a middle road or one of them would be to do nothing. And one of them would be this extreme option. ‘What’s the most extreme thing I could do that could really shake things up and have the potential for a completely new outcome?’ And I think it worked early on in his life for him.
For example, when he was given smaller tasks, there was a famous example where he was told to help out with evicting one of the wives of King Fahd from a palace because that palace was needed for other purposes. Nobody else was able to do this. She was a strong personality, but he showed up with a couple of buses full of cleaners and workers. And said to her in very clear terms, ‘You’re leaving tonight. The power is going to be cut off at midnight. These people are here to pack your things.’ It’s an aggressive approach that probably very few other princes would have taken. He kept using that over and over again.
Sometimes he’s made out to be very emotional and erratic. While I’m sure he has his emotions like anyone else, I think a lot of his decision-making is highly strategic. It’s almost bold to the point of reckless in most cases. It looks like it’s erratic or emotional, but in fact, it’s just him thinking, ‘I want to achieve the biggest possible outcome in the shortest period of time.’
And one of the interesting experiences is, the more you research or understand about him, he has a chameleon effect on you because he’s in some ways a classic Millennial. He loves video games, first person shooter games, or Age of Empires, which is ironic. He watches movies. He watches TV shows. He’s famous for being out in his tent outside of Riyadh and calling up ministers and asking, ‘Why is the Internet so slow? I’m struggling to stream Game of Thrones in my tent.’
At first he seems like somebody that you might be able to recognize or you might be able to understand. But it is a bit of a chameleon effect because really, he was steeped and raised in a very strange and interesting background. Learning everything from his father, who was the governor of Riyadh and who really understood and administered Saudi politics in all of its forms. That’s the dual nature of him.
JUSTIN SCHECK: Initially we looked at him, we had the same reaction a lot of people have, which is seeing this seemingly contradictory figure. Someone who, on the one hand, he seems like a liberalizer and on the other hand, he seems like a despot. There seemed to be very little in common with these two sides. On the one hand, he’s creating freedom. On the other hand, he’s cracking down very harshly on people who criticize him. But as we got deeper into it and got to understand him a little more, I’ve come to see a consistency across all his actions.
His goal, his main chief goal is to make sure that his family continue as the rulers of Saudi Arabia for as long as possible and that he be the next member of that family to take the throne and the first member of his generation to take the throne. And with that in mind, you can see a consistency in all that. The liberalization, allowing women to drive, allowing movie theaters back to the country for the first time in decades, concerts, tamping down the religious police. A lot of that or perhaps all of it was aimed at building support for himself among the country’s youth population.
The idea is, in the past, they also had gotten their legitimacy as rulers from their alliance with this very conservative religious establishment. It was was the alliance between the religious establishment and the family that helped his grandfather conquer the country as Saudi Arabia. And since then, for a century or so, their legitimacy has come from the religious association. What Mohammed bin Salman saw was a country where 60 percent of the population is under the age of 30. They have the world’s highest smartphone usage rate, the world’s highest social media saturation, all these young people sitting around on Instagram, seeing their peers in other wealthy countries, having all sorts of economic opportunity, entrepreneurism opportunities, going to movies, go to concerts, going on dates. And they were not allowed to do these things because of these religious strictures.
His concern was that this population wasn’t going to think of him or his family as legitimate rulers based on their alliance with the people who were constraining their lives. These people wanted different types of social freedoms. So his liberalizations is very much aimed at building a constituency among the young people, both to prevent protests and threats to the family and also to show people in the family that he has the support, that he’s the one with the support of the population.
And on the flip side, the arresting people who criticize him on Twitter, the Khashoggi incident, all these things that are very brutal were done to try to tamp down on criticism and tamp down a public criticism that could undermine him. Similarly, things like the Yemen war and some other big and very aggressive actions he’s taken – the Qatar blockade – seem sort of questionable, but if you look at them as things that he is doing to build a kingly reputation, to show that he’s someone who does big things. He leads a country, he takes action rather than sit back and watches. There’s a bigger consistency of purpose that you can see with him.
MICHAEL MORELL: Do you think there are leaders in the world that you think he looks at and tries to model himself after?
BRADLEY HOPE: One of the points in the book, we talk about some of the people that he was admiring. He hasn’t really spoken about this much, but he does have an interest in some of the famous caliphs and the early eras of Islam, especially the ones that are known for their aggression and prowess in battle. He famously talks about his grandfather a lot. In the world at large, he doesn’t have necessarily a model. He definitely bristles at being compared to others, especially people like Putin and Saddam Hussein. In some ways he looks up to businessmen more than he does fellow world leaders. And he spends so much of his time on business topics.
And even as we speak now, our latest reporting is that he’s been holed up out of his Neom, this big project where he’s built some palaces for him, his family. He’s been having these kind of round the clock discussions about the 2030 plan, the economic plan. While during COVID-19, his team has built a Red Sea tourism company that has cruise ships starting to go around the Red Sea for homegrown tourism. Those are the kinds of things that really motivate him. He loves these characters like Steve Jobs and other famous American businessman. Maybe that explains why he spends so much of his time with people like Masayoshi Son. This visionary technology character. Masayoshi Son keeps coming back to Saudi Arabia to help out on any kind of project that he has, including whether it’s things like Mecca, the future of that city. He’s listening to those guys and getting their advice more so than anybody else.
MICHAEL MORELL: There is this great dichotomy that you guys talk about that I think you’ve done a great job squaring between the great reformer and the ruthless dictator. Could you give some examples of the great reformer and then some examples of the ruthless dictator?
JUSTIN SCHECK: The social reforms like taking power away from the religious police, making it so that members of the opposite sex can almost go on a date in public, which you couldn’t do, allowing live music, allowing movie theaters to come back in, creating places where there can be tourism. All of these are certainly meaningful. Allowing women to drive. These are things that have meaningful effects on people’s lives.
In terms of his grand vision for Saudi Arabia, the more difficult reform and one that’s not the low hanging fruit is transforming the economy to get away from oil. This is something that Saudi Arabia’s allies have been pushing the country to try to do for decades, saying, ‘One day the oil is going to run out and you’re going to need to have a real economy or else you’re going to descend into chaos.’
He saw that his uncle who’d been king, had just done very little and acted so slowly. He also came in at a time where his father becomes king in 2015. 2014 is when the American fracking boom really took off in a way that sent the U.S. on this trajectory to become an oil exporter rather than an oil importer. Then we get to this point now where there’s a question about whether the demand for oil will run out before the oil itself. So he sees a much shorter horizon in which he needs to diversify the economy and get it off its dependence on oil. And everyone supports that. And there’s been very little progress doing that. So on the reformer side, those are the key things.
On the non-reformist side, the things that have led people to call him a brutal despot. The bombing of Yemen was something he started doing a couple of months after taking over the military. Saudi Arabia had always been this a place that followed in terms of military campaigns. And he wanted to take the lead and go after what he saw as an Iranian backed rebel militia in Yemen right on the other side of Saudi Arabia southern border. He and his top officials told people that, this will be over in a few weeks, maximum, a few months. Five years on, there’s famine. There have been bombs dropped on innocent people, thousands and thousands of deaths. It’s the world’s biggest humanitarian crisis. That’s something that he’s decided to continue doing to fight this proxy war. That’s obviously seen as problematic in the eyes of many of the world.
There’s the murder of Jamal Khashoggi, who had been the Saudi writer who was writing for The Washington Post opinion page, who was famously killed and dismembered in the Saudi consulate in Istanbul by men working for Mohammed bin Salman. He said he didn’t order them to kill him, but nonetheless, they were working directly for him. That’s going to be a permanent stain on him. There’s been this trend that we and our colleagues have written about in the Journal of when someone with a lot of Twitter followers and followers in Saudi Arabia criticizing him, he brings the person in and maybe questions them or beats them or imprisons them just for criticizing him.
There have been other clerics who’ve been criticized and accused of terrorism on relatively thin charges because they seem to be threats to his power. There has been a very clear tightening on Saudi Arabia’s tolerance of criticism and very harsh treatment of people seen as rivals. He turned the Ritz Carlton in Riyadh into a prison and brought in many of Saudi Arabia’s richest and most powerful men and forced them to cough up some of their wealth or else face indefinite imprisonment. So there’s been a lot of examples.
BRADLEY HOPE: Mohammed bin Salman, despite being seen as a reformer in the Western media and also among Saudi youth, he’s completely allergic to anything close to political reform. I’ve never in any of my reporting heard of him having anything close to a discussion even of political reforms. Early on he instructed his team to go and conduct polls around the world about Saudi Arabia. He got a lot of his initial ideas of what to focus on, with what had to do with global perceptions of Saudi Arabia.
So they came back with a list that said, ‘The dominant perceptions of Saudi Arabia are, it’s a bad place for women. It’s considered backwards. The religious police are out of control.’ The kind of shallow perceptions that most people have of Saudi Arabia, not that it is inaccurate, but that’s about as far as it goes.
He instructed teams to be formed around each one of these key things to go out and start researching, ‘How can we upend this?’ And to me, that’s such a profound thing, because he didn’t go and poll Saudi citizens. He polled the rest of the world about it. And I think that really explains something. He is completely politically illiberal, but he’s socially liberal. And that is something that everyone needs to know when they’re trying to think about Mohammed bin Salman.
MICHAEL MORELL: Have you seen any moderation in his despotism? Has he learned anything from Yemen and Khashoggi and the backlash in the West?
JUSTIN SCHECK: Yemen is hard, it’s hard to say. I’m sure he’s learned lessons from Yemen, but it continues and the nature of a quagmire is even if you learn lessons, you’re still stuck in the quagmire and there’s not a straightforward way out. He was already a couple of years into Yemen when they launched the Qatar blockade, which didn’t work out either. He’s probably learned lessons about perhaps taking the most aggressive possible stance in geopolitical conflicts.
On Khashoggi we have a little bit more insight. After the murder, I think he was very surprised by how the world reacted, by how the West reacted. After initially denying it and then admitting it. The Saudi government, the foreign minister went on FOX News and said, ‘What about Abu Ghraib?’ There’s this what-about-ism approach that, we would hear a lot from people in and close to the royal court. That’s not an argument that resonates in the US and in Europe. I think he was very surprised by the outrage and by the fact that people in these other countries that he considers as important were going to harp so much on the death of one Saudi citizen. This is a Saudi citizen he viewed as a traitor. ‘Why is this such a big deal?’ He told someone, he blurted out, ‘Oh now the world sees me as a journalist killer.’
His image is very important to him and, because he’s not the king yet, he is the Crown Prince, and creating this image of someone who is fit to be king is very important. He was extremely concerned and surprised that he is now defined in the eyes of many foreign leaders as the guy he who killed the journalist. I think he’s learned to be a little bit less aggressive when it comes to dealing with individuals overseas like that. They have a long history of kidnapping and rendering critics, and that seems to have been toned down a little bit.
BRADLEY HOPE: We’ve noticed in some of the people we spoke to who spoke to Mohammed bin Salman after the killing, he expressed — maybe not specifically about that issue — but he expressed regret that he had gone too far. Because this year, 2020, was meant to be the year when he was supposed to button up all these issues. There was a team trying to figure out the Qatar blockade, Yemen, and things went completely differently than he had planned, but he had hoped to be on the path to rectifying his image.
I think that idea of image is going to be really useful in understanding what is going to come next with Mohammed bin Salman, because now at the same time, maybe he has toned down. Or at least he’s more responsive to criticism in advance. At the same time, he does still have that decisiveness streak and that heuristic to go for the biggest option.
The oil war he started with Russia that had global ramifications is a good example of that, because it was clearly not the low-impact decision. He wanted to do something. He wanted to make it clear that he could play chicken with Russia. But he also wanted to show the rest of the world that Saudi Arabia still matters, even though the United States no longer depends on Saudi Arabia for oil the way it used to. Saudi Arabia still is where oil prices are decided. He can make a decision and it can have global impact. There is an element of moderation. But at the same time, I wouldn’t expect any less fireworks going forward.
MICHAEL MORELL: How do you think he sees the United States?
JUSTIN SCHECK: For decades, the Saudi US alliance was fairly straightforward. The US wanted consistent, uninterrupted oil imports. Saudi Arabia wanted the military alliance. And the deal was Saudi Arabia would not mess with the price of oil, would keep the oil flowing, and would contribute to stability in the region. And the US would buy the oil and be aligned with Saudi Arabia against its chief antagonist, Iran. It’s an oversimplification, but it was more or less where it was. The relationship was held largely by people who were were institutionalists, people who’d been in the US government under Reagan, under both Bushes for decades in the State Department, in the CIA.
And on the Saudi side, there were people like Mohammed bin Salman’s predecessors, Crown Prince Mohammed bin Nayef, but also people who were not members of the royal family, who were essentially technocrats, who worked for him, who had a long standing relationship with the US. On security, there was this institutional relationship and what happened as the US became a net oil exporter rather than an oil importer, that foundation for the relationship between the two countries disappeared. The U.S. wants stable oil prices, but the U.S. doesn’t need Saudi Arabia to send oil here anymore. And at the same time, Mohammed bin Salman in 2015 comes in and realizes that the alliance with the US, the relationship between the kingdom and its most important ally is held by people over whom he has no control and in some cases with whom he’s a rival.
His main rival for the throne, Mohammed bin Nayef, his cousin, going back to the post 9/11 days, had this long-standing intelligence relationship with the U.S. and also with the State Department. And his people did, too. Mohammed bin Salman saw that he needed to take control of this relationship to pave his way to the throne, or at least he believed that. He wanted to be seen within Saudi Arabia and within the Muslim world as the person who is the point person in that relationship.
To that end, 2015, he fired a guy who’s been in the news lately, Saad al-Jabri, who was the top non-royal intelligence official working for Mohammed bin Salman’s rival. He took subsequent steps to undermine Mohammed bin Nayef and his cousin and to take control of the U.S. relationship himself, largely by forming this one-on-one relationship with Jared Kushner and between his men and the White House.
He sees the US as an incredibly important ally, both to Saudi Arabia, but also for himself. He wants to be the person who controls that relationship so he can show other members of his family and other people in Saudi Arabia that he is a person who needs to be king. The U.S. relationship, it’s not just about what’s best for the kingdom, it’s about what’s best for Mohammed bin Salman. Now, obviously, Saudi Arabia buys huge amounts of weaponry from the U.S. and this is very important to him and to the country. And that’s a longstanding, important thing. But a lot of his relationship with the U.S. has been focused on how he can turn it into something that paves his way to the throne.
BRADLEY HOPE: The other thing to keep in mind is even if he understands the relationship is changing, I think in his early experiences with these other world leaders, whether it’s Putin or the leadership in China, I think he came away from those experiences worrying a lot more about those other guys and preferring the United States in just a personal way. He often tells people about his favorite memories in the United States — that’s in a way why the Khashoggi situation really hurts him on another level. He feels like it’s not good for him to go back to the United States for a long time. He doesn’t know what the ramifications are, much less if there might be protests.
But I think he still has a deep affection for America, its culture, its attitude towards business. He’s deeply attracted by these technology companies out in Silicon Valley. I think no matter what the changing relationship is on the government-to-government level, I think that’s going to still be something that’s important to him. Because he doesn’t enjoy even going to Pakistan. That was one place he was able to go after the Khashoggi murder, where the newspapers all ran front page stories about how great he was. I think it is still not the same for him as traveling to New York, where he used to spend a lot of time with his dad. I think it was his Uncle Sultan was receiving medical treatment, he has a lot of memories about Manhattan. He loves walking around and that sort of thing. That’s still going to be something that’s important going forward.
MICHAEL MORELL: Given that he played the U.S. card by building the relationship with Jared Kushner and the President and the White House, not through the institutions. do you think he worries about a Biden administration?
BRADLEY HOPE: I think that he’s not too worried because at this point in time, he’s not in the fragile position. Let’s say that Joe Biden is elected as president. What could that mean for him? I think that he’s going to feel like there could be some more noise from the government, but there’s unlikely to be a wholesale shift or a decision that Saudi Arabia is no longer a core ally in the region.
Let’s say that Mohammed bin Salman is set to become the King of Saudi Arabia and he’s 35 years old now. Maybe he’s going to be the king for five decades or 10 to 12 presidents. He knows even if he has an unpleasant interlocutor on the other side, he only has to wait around for that guy to be passed over to the next guy.
JUSTIN SCHECK: He’s not like an American or European politician who is worrying about how things will look one or two or three or four years out. He’s looking at 40 or 50 years out because he’s 35. He could be king for half a century. And so his decision-making is being done with different perspective there. I think that’s something that I always have to remind myself of.
BRADLEY HOPE: He also has the Trump card sitting in his deck if he wants to use it, if he decides to play the aggressive high-impact move, which is fly to Jerusalem and shake hands with the leader of Israel, I think he knows that while being immensely risky in many different ways for him, it is something he could do that would change the discussion, change the narrative.
MICHAEL MORELL: Is there any question in your mind that he will become king when his father dies? Or is that a given?
JUSTIN SCHECK: It seems to be a given. The last six years of his life have been full of surprises and full of unpredictable events. He’s very effectively sidelined his rivals within the royal family, from what we can tell. Many of them are under house arrest or worse. But there’s always the threat of someone else in the world. You hate to say, but Saudi Arabia is a place where it’s happened before that a king was shot by a family member. These are things that can happen.
But barring something really shocking like that, there’s no evidence that King Salman would want to change the line of succession. In fact when there have been efforts to try to take power away from Mohammed bin Salman when in the aftermath of the Khashoggi killing, President Erdogan of Turkey tried to leverage that killing into an attempt to move Mohammed bin Salman aside, maybe take some power away. And it didn’t work. He came out of that as strong as he had been domestically. So I don’t see any reason to expect there to be a change.
BRADLEY HOPE: The other thing to remember is that there’s not a lot of daylight between the king and Mohammed bin Salman. Because Mohammed bin Salman is not only the Crown Prince, but he’s also the head of the king’s court. He’s sort of in charge of all the information that goes to his father as well. While I think he treats his father with great respect and for example, this issue of normalizing relations with Israel, holding back at least partially or mostly out of respect for his father’s perspective on that. The only thing that would seem conceivable is if the king was so powerful and there’s enough distance that he could make a decision about changing things up or having another person step in for a period of time. But I don’t think there’s any indication of that.
MICHAEL MORELL: Do you think he will end up making Saudi Arabia a better place or worse place? Do you think he’s going to end up being the Ataturk or the Lee Kuan Yew of Saudi Arabia, the guy who takes his country to a much better place? Or is he going to end up being the Mikhail Gorbachev of Saudi Arabia, the guy who is responsible for its collapse?
BRADLEY HOPE: If he continues on the path that he did the first five years, it could lead to something that makes it more volatile and and just more combustible as a country. Because you can’t just bring about social reforms and not talk about things like religion, he has not really espoused the kind of worldview about religion or the role of religion.
And same for politics. He hasn’t even really addressed that at all. It’s not part of his plans. If you have this increasing social liberalization, increasing access to the whole world, I don’t think that can last. Because these economic reform plans are not going to be as successful as they might seem on paper, it’s going to be a very rocky road with a lot of problems along the way. And that could cause a lot of unrest. If he does start to shift his focus away and maybe focus more on economic development and less on regional politics, adventurism with his army, then it’s possible that it could be more the way of Lee Kuan Yew.
JUSTIN SCHECK: I agree with that. If he does focus on economic development, there are huge risks there as well. If Saudi Arabia does not end its near-total reliance on oil revenue, there’s not really a great future for it. It’s hard to envision the future of a country that doesn’t have a great source of revenue, has not enough fresh water for its people, virtually no arable land. He’s talked a lot about how he’s going to do that, but so far the things that we’ve seen him do to get to a real economy haven’t been effective. Investing close to 50 billion dollars in foreign tech companies hasn’t produced meaningful dividends for the kingdom. But beyond that, it hasn’t produced a clear roadmap for how those tech investments are somehow going to fuel that economy.
At the same time, there has been more entrepreneurism, more of a startup culture within Saudi Arabia, but not at a meaningful level that’s creating revenue. But then beyond that, in order to create the real economy, even if there is progress, he needs to start taxing people. In Saudi Arabia, with some small exceptions, there aren’t really taxes. So what happens when it goes from this subsidy-based economy where oil is paying for everything to having an absolute monarch who now tells his people he wants them to pay taxes? There’s a long history of that not going over well in America and other places. Even if he does really double down in domestic economic reforms, it’s very hard for an absolute monarch to decree, ‘Now we shall have a functional economy and you will pay taxes to me.’ There are huge risks there in the long term. I think for most young people, Saudi Arabia is objectively much better to live in now than it was 10 years ago. But further out, I don’t know.