Ann Arbor (Informed Comment) – US policy in the Middle East is a dinosaur-like holdover from two eras, the Cold War and the “Global War on Terror” (GWOT). Here I would like to raise the question of whether the U.S. lost both.
The United State government does a lot o hand waving about human rights, but they obviously do not guide American policy, or else Washington would not be backing the genocide in Gaza and giving a free ride to Saudi Arabia’s authoritarianism, among the most oppressive in the world.
What are long-lasting US policy goals in the region stretching west from Morocco to Afghanistan?
The US above all wants American corporations freely to operate in Middle Eastern countries and to be able to expatriate profits easily. In the Cold War, it wanted to block Soviet influence and to keep Middle Eastern governments from adopting socialist principles of government ownership of much of the economy (since this policy would inevitably forestall US corporations from making money there). My belief that US foreign policy was often not so much driven by the Great Power considerations favored by Realists but by a desire to be of service to the US corporate sector is derived not so much from the Leninist tradition (which I find often scholastic and self-contradictory) as by historical research in the archives. The US embassies in the Gulf, for instance, were frequently appendages of Big Oil and often were secondary players.
Although in the Middle East only South Yemen went Communist (1967-1990), the US in some ways nevertheless lost the struggle to keep the region open for US corporate money-making. In Egypt at the height of the socialist Nasser period, 50 percent of the economy was in the public sector. Even today, 31% of the economy is in government hands. That is more than in socialist India under Nehru in the 1950s and 1960s, where it was 25%.
Moreover, the fate of the petroleum industry was consequential, since it is a major money-maker for much of the region. But the petroleum industry was widely nationalized, often inflicting massive damage on US corporations, in the 1970s. That happened in Kuwait, reducing the Mellon family’s Gulf Oil Corp. from the 10th-largest company in the US to, essentially, an office in Standard Oil. Ironically, oil nationalization was pursued both by left-leaning governments like that of Libya and by right-wing governments like Saudi Arabia and Kuwait. Another irony: oil economies are typically dominated by the public sector, so they are all even more “socialist” than Nasser’s Egypt. Some 25% of Saudi Arabia’s economy is in the non-oil public sector, but another 42% of GDP is in the oil sector… which is in the hands of the state-owned ARAMCO. So a majority of the economy is essentially public, maybe more than in Communist China. In any case, the place for US corporations is limited.
While the strategic US goal of ensuring free export of petroleum to its Cold War capitalist allies in Europe and Japan was achieved, the economic goal of opening Middle Eastern economies to US companies à la Central America was not, at least by the 1970s.
The other pillar of US policy in the region was to insert and establish the Israeli state as a sort of huge American aircraft carrier, and to beat the local population into accepting the displacement and marginalization of the Palestinian population. While this policy largely succeeded militarily, it failed with regard to public opinion. With the exception of the Arab Gulf countries, nobody in the Middle East likes the US or Israel. This public opprobrium poses a severe limitation on American investment and corporate profit-making in the region. The whole point of advertising is to convince the public that corporations are their friends. This campaign, aided by television and subsequent media, has failed in some sectors even in the United States. But it is a non-starter in the Middle East. Although particular boycott campaigns such as the targeting of McDonalds over Gaza, may not be long-lived, the general opprobrium in which US companies are held is a limitation on investment and profits over the long term.
Today, US Direct Foreign Investment in the Middle East only amounts to $80 billion a year, out of a total of $6.68 trillion in US global investments. The Middle East and North Africa, with some 500 million people, is a rounding error in American corporate investment. So while the Soviet Union lost the Cold War in the Middle East, so did the US corporate sector, upholding which was a major reason for fighting the Cold War in the region. Obviously, the US win was far more significant in Eurasia.
The 1979 Islamic Revolution in Iran set off another US “war” in the Middle East, since radical Muslim fundamentalism was as hostile to the American corporate sector as Communism had been. Bell, IBM, and other US firms lost billions in Iran as assets were nationalized or they were simply chased out. This exclusion of US firms has lasted until this moment, underlying Washington’s hostility to the ayatollahs (whose ideology otherwise resembles American Christian nationalism).
Iran’s Shiite populism, which was anti-monarchical, scared Saudi Arabia and other Gulf monarchies, which were close to the US diplomatically and militarily. Although these monarchies said they based their rule on Islam, it was a top-down royal ideology that left no place for popular sovereignty. It was often apolitical Islam. Meanwhile, radical Sunni groups in part inspired by the successes (but not the ideology) of the Shiite revolutionaries, were brewing.
The al-Qaeda 9/11 attacks set off a “Global War on Terror” (GWOT), or at least that is the way the campaign was branded by the George W. Bush administration. The ostensible target of the GWOT, however, was asymmetrical networks of political Islam such as al-Qaeda, which aimed at overthrowing governments friendly to the US such as Egypt and Saudi Arabia. Obviously, where such movements might succeed, they would also be bad for the US corporate sector given their anti-Americanism.
The US tried and failed to dislodge the Taliban from Afghanistan, though its status as the fifth poorest country in the world made it anything but a geopolitical prize. The US invaded Iraq and overthrew the nationalist government of Saddam Hussein, the leader of the Iraqi Baath Party and a foe of political Islam, in one of the great foreign policy paradoxes of American history. If the fight was against al-Qaeda and political Islam, why remove a bulwark against them?
The answer to the puzzle is that Neoconservative thinkers such as Paul Wolfowitz viewed Baathist Iraq and Baathist Syria, and Qaddafi’s Libya, and some other regional governments as survivals of a kind of Middle Eastern Stalinism. Huge public sectors and hostility to capitalism were what marked them from this point of view. The war on Iraq was in essence a continuation for these figures of the Cold War, aiming at dismantling the last exemplars of socialist state economies. The Neoconservatives did not actually understand or take political Islam seriously as a threat, and therefore they inadvertently turbocharged it.
Still, the US did take on, in that period, Muslim fundamentalist challengers such as al-Qaeda in Mesopotamia (Iraq), and its offshoot, ISIL (ISIS, Daesh), the al-Shabab in Somalia, and al-Qaeda in the Arabian Peninsula in Yemen. These groups were pushed back.
The region is now, however, seeing a resurgence of radical, populist political Islam of a sort that is unlikely to be good for American interests. In 2021, Afghanistan fell again to the Taliban. The Arab Spring revolts sometimes took this direction. The Houthis, political Islamists, have 80% of the population of Yemen under their rule, and the Muslim Brotherhood has some of the rest. Tripoli and Western Libya are ruled by exponents of political Islam. General Abdel Fattah al-Burhan in the Sudan, challenged by the Rapid Support Forces, has increasingly turned to fighters animated by political Islam — a comeback for a group that had been powerful in previous Sudanese governments but lost out to secularists in the 2019 revolution.
It is true that some of these movements are Shiite political Islamists, and some are Sunni, and that they are most often at loggerheads. They have very occasionally cooperated, as in 2004 in Iraq. But if they are generally anti-American, it is cold comfort to Washington that they do not like each other, either.
And now a former al-Qaeda affiliate, the Hay’at Tahrir al-Sham or Levant Liberation Council, which is still listed by many countries– including the US — as a terrorist organization, has proved victorious in Syria.
An Islamist crescent now stretches from Kabul through Tehran to Baghdad and Damascus, with outlying enclaves elsewhere in the region. All of them have more or less socialist economies in practice, with enormous public sectors. All of them have a degree of hostility to the United States, though Iraq is the most ambiguous case in that regard, since the Shiite government fears ISIL more than it does Washington. Still, Prime Minister Mohammad Shia’ al-Sudani has asked that US troops be out by 2026.
In the end, the age of small public sectors and widespread openness to American investment of which the Cold Warriors dreamed has never dawned in the Middle East, despite the defeat of Communism. And now an age of political Islam that is hostile to most US interests seems to be being born.
Is Usamah Bin Laden, somewhere in Davy Jones’s locker at the bottom of the Arabian Sea, having the last laugh?
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Bonus Video added by Informed Comment:
Al Jazeera English: “Who is Abu Mohammed al-Julani, leader of HTS in Syria?
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