• Ibrahim Insights

When Revolutionaries Drive Ferraris: What Would it Take to Democratize the Persian Gulf?

In 2011, the world watched as popular uprisings spread from country to country throughout the greater Middle East. As the conflagration spread, observers wondered what would happen to the Gulf States. The Gulf as a region has confounded many academics for decades. Historically poor in capital, labor and land, the Gulf was changed forever with the discovery of massive oil reserves in the 1950’s. Over the next several decades, the Gulf countries would emerge as powerful autocratic regimes that provided much of the world’s petroleum needs. These countries seemed likely to fall victim to the resource curse: a paradox that occurs in many resource rich countries that, counter-intuitively, experience high rates of autocracy and low levels of development and growth. While several of the political outcomes predicted by the resource curse hypothesis have indeed been realized by most Gulf countries, namely autocratic governments and low levels of civic engagement, they have not become victims of the economic prophecies. In fact, the members of the Gulf Cooperation Council (GCC) have experienced high levels of growth and development. They have attracted massive streams of migrant workers to build modern metropolises such as Dubai, Riyadh, and Doha. After it became clear that the GCC was able to inoculate itself against the Arab Spring, a process that involved a joint effort in violently crushing the Bahraini uprising, several theories arose that attempted to explain why these states were more robust than their neighbors. The truth is, however, that the massive capital wielded by the GCC has only bought them one thing: time.

Sean Foley, the author of The Arab Gulf States: Beyond Oil and Islam, poses that the Gulf States go far beyond their rentier framework and are, in fact, nuanced 21st century nation-states. While Foley’s underlying desire to explain why the Gulf countries have not succumbed to the purely kleptocratic model found in many central African regimes is important, he overstates just how robust these states are. The ‘benign’ autocracies of the GCC are indeed outliers of the traditional progression of rentier states. However, 40 years of history does not necessarily prove stability in perpetuity. While Foley’s book was published shortly before the outbreak of the Arab Spring, he, and many others, would undoubtedly point to the survival of their autocracies as further proof of their resilience. However, in most cases the Gulf states essentially bought their way out of the Arab Spring by providing generous pay raises and other benefits. Politically, there were no reforms. On the surface this seems like evidence of the invulnerability of the GCC countries: that they were largely able to avoid uprisings and violence without compromising the integrity of their autocracy. While this is an impressive feat, not all Gulf countries are identical, and the micro-level interactions happening within some of these countries have the potential to slowly but surely breakdown the ironclad oil Sheikhdoms.

Some GCC countries, such as Saudi Arabia and the United Arab Emirates, sit on top of massive oil fields, producing the second and sixth largest quantities of petroleum respectively, and therefore have access to huge amounts of capital. Not only do they function on a rentier state model and do not tax their citizens, but they also provide generous public goods, stipends, and debt relief.

These countries are able to make concession after concession in order to push the issue of democratization beyond the horizon. It would take an extremely determined individual to risk their extravagant livelihood in a showdown with the government over political rights; most revolutionaries do not drive Ferraris. However, even in these countries, the richest of the rich, the limits do exist. The UAE has been undergoing a massive effort to diversify their economy over the past three decades in recognition that either supply of or demand for oil will one day no longer be as inelastic as it seems today. These efforts have buffered the country, to some degree, from the recent plummet in the global price of crude.

However, the price crash has still hurt. In the UAE, some subsidies have been cut already, and more will be soon if the price of oil cannot rise above $50/barrel. Again, the horizon seems to creep closer and closer. As it stands today, the only place where Emirati Citizens are not privileged above and beyond the ex-patriots who make up 90% of the population is the gas pump where both are taxed equally, for now. As the massive gap between locals and expats starts to narrow, and Emirati Citizens are forced to return to work to make a living, sentiments in the UAE might change. However, this seems like an unlikely story, and one that would play out over decades rather than months. Perhaps the most worrying threat facing the GCC monarchs is the durability of their less well-endowed partners. Oman, a country far less diversified than the UAE and with far fewer oil fields, has been hit hard by the oil prices of the last 18 months.

Forced to make more serious political concessions than some of its neighbors in the wake of the Arab Spring, Oman seems to stand at a tipping point. The rentier model might not prove to be sustainable in Oman. Next year, the government will be implementing the country’s first ever tax in the form of a VAT. There is also rumored to be serious discourse at the top levels of Oman’s government about instituting an income tax in the future, something Omani Citizens are keenly aware of. 88% of Omani nationals are employed by the Government but some Omanis can be found working as cab drivers alongside ex-patriot counterparts mostly from India, Pakistan, or Indonesia. As Oman’s government can cut fewer and fewer checks, many more Omanis might be forced into low paying private sector jobs. And, just as Omani wallets are being squeezed, there is another ominous cloud hanging low over Muscat. The health of Oman’s Sultan, His Majesty Qaboos bin Said al Said, is worsening. Oman has developed a cult of personality around the Sultan, hailing him as their savior: the man who brought Oman out of the dark ages and into the 21st century. It is hard to imagine that his successor, whoever he may be, will be able to retain the same levels of reverence.

The richer and more robust of the GCC countries, notably Saudi Arabia, and the UAE will almost certainly not collapse tomorrow or the day after, but they may not be able to escape the march of time. The uncertainty faced by the less stable of the GCC countries, Oman and Bahrain for example, where the brutality of the counter-revolutionary movement cannot have been forgotten, are huge threats to the future of the Sheikhdoms. While these countries have so far been able to avoid the global trend towards participatory democracy, they will eventually have to make the choice every autocrat fears: fight to hold on to their power or live to see it fade away.

Yano Windmiller is a member of the 2016 Ibrahim cohort.

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