On Saudi Arabia: Its People, Past, Religion, Fault Lines - and Future Read Online Free PDF Page B

storerooms. He literally kept his gold and silver coins in a metal chest that was carried about the kingdom wherever he went, as omnipresent as the black doomsday box that accompanies modern American presidents wherever they go.
    “Neither I nor my ancestors have kept a chest in which to hoard money,” he told one of his ministers. “Hoarded money does no good. In peace I give all, even this cloak, to anyone who may need it. In war I ask and my people give all they have to me.”
    By the 1930s, the cost of government salaries, an army, payments to tribal leaders to maintain loyalty, and efforts at nation building such as installing radio and telegraph stations and creating a water supply for townspeople left Abdul Aziz almost always broke. So desperate was he that in 1933 for only 50,000 pounds (about $250,000) he granted Standard Oil of California, which a year earlier had struck oil in neighboring Bahrain, a concession in Saudi Arabia. “Put your trust in God and sign,” the king instructed his finance minister.In 1938 Standard Oil struck oil—gushers of it—in the kingdom’s Eastern Province.
    Abdul Aziz’s first royalty check exceeded $1.5 million. He was so delighted, he led a group of two thousand people in a caravan of five hundred cars to the oil fields to turn the tap to allow the first Saudi oil to flow into tankers for export. Having heard a radio report that man would one day reach Mars, a planet deemed as desolate as the deserts in Eastern Arabia, Abdul Aziz asked one of the American oil men, “Do you know what they will find when they reach Mars?” Answeringhis own question, he said, “They will find Americans out there in the desert hunting for oil.”
    The succeeding Al Saud monarchs have lived more or less luxurious lifestyles, but the family as a whole has become infamous around the world for the profligacy of its numerous playboy princes. While Abdul Aziz would have disapproved of such profligacy, his strategy of using at least some of the kingdom’s wealth to buy the loyalty of its subjects continues to this day. Buying loyalty in Saudi Arabia is not, as in so many countries, a matter of greasing the palms of purchased politicians, since there are no independent Saudi politicians to purchase. Purchasing loyalty is far more pervasive than that.
    Indeed, Saudi Arabia is a wealthy welfare state, in which the public pays no taxes yet receives widespread, if often poor-quality, services, from free education and health care to water and electricity and, of course, cheap energy.At least 80 percent of the revenues in the Saudi treasury accrue from petroleum. All revenue, whether from oil, earnings on the country’s $400 billion in foreign reserves, or even traffic fines, flows into the central government in Riyadh—that is, to the royal family. No accounting is given to the public of either total revenues to the Al Saud coffers or total spending by the Al Saud—on behalf of the people and on behalf of the ever-expanding royal family. The public has no say in the formation of the annual government budget, which represents that portion of government spending that is disclosed publicly. The Majlis Ash Shura, appointed by the king to “represent” the people has no role in budget formation.Fully 40 percent of the budget that is disclosed publically is labeled “Other Sectors” (including defense, security, intelligence, and direct investment of the kingdom’s revenues outside the country) and is opaque to the public. In sum, what the royal family takes in from national oil revenue and spends on itself is secret. Not surprisingly, Saudis increasingly are demanding not only that more of the wealth be spent on better government services, but also a transparent accounting of the nation’s oil revenue, which they believe belongs to the people, not to the royal family.
    More important than these entitlements, which, as in all welfare states, the public largely takes for granted, is the largesse that the