There’s One Reason America Refuses to Hold Saudi Arabia Responsible for Murder
The apparent extrajudicial execution of Saudi Arabian journalist Jamal Khashoggi in Turkey on Oct. 2, 2018 seemed like a watershed moment in the protracted push to hold the autocratic, theocratic Saudi regime accountable.
The moment seems to have passed. The recent U.S. elections have overshadowed the story, and neither Khashoggi’s murder nor U.S. relations to the Saudi government were election issues.
How is it possible that neither party took advantage of the controversy to stake out a position opposing such a criminal state? The answer is that Saudi Arabia is a linchpin of U.S. imperialism, and the American way of life makes it inevitable that we turn a blind eye to murder and crime from regimes like Saudi Arabia. Undoing that is something neither party intends to do.
Modern imperialism arose in the 19th century, when the newly industrialized capitalist regimes of Europe found themselves with more capital than they knew what to do with at home.
Rapid and unprecedented expansion of production and the conversion of tens of millions of people from peasants into industrial laborers grinding out wealth for their employers 80 or more hours a week generated huge profits for the industrialists.
This was especially true as these industries achieved new levels of efficiency and economies of scale by consolidating, ultimately resulting in a small number of massive financial institutions controlling multitudes of industries, extracting enormous profits from them all.
But capital that can’t be invested is dead money — worthless — and there was only so much that could be invested in these European countries. If the money was going to be put to work it would have to go elsewhere, and so modern imperialism is characterized not by exaction of tribute, but by export of capital to virgin markets.
There it can be used to build new industry which will certainly extract wealth from those countries and bring it back to the center, but it’s all a function of that initial export of capital.
Saudi Arabia is a host of massive amounts of exported capital from the United States. It’s true that there has been a dramatic drop in foreign direct investment in Saudi Arabia in just the last two years as a result of “Saudization” reforms promoted by the royal family, but historically Saudi Arabia is one of the top recipients of FDI in the Middle East and in Asia as a whole.
The United States provides 22 percent of Saudi Arabia’s total FDI, with the United Arab Emirates at 20 percent and other countries barely registering single digits.
That UAE money is also coming in substantial part from U.S. and even more significantly U.K. financial interests, meaning that Saudi Arabia is an indispensable site for Western capital export.
At top — Khashoggi. Above — a Saudi oil well in 1938. Photos via Wikipedia
Imperialism adopts a certain security stance because it needs to protect the investments of the imperialist economies from risks both internal and external to the client economy. These investors need to ensure continued access to the resources and labor they are purchasing, and they need to shield those commodities from competitors who might seek to buy them at a better price.
Because most people resent being exploited and seeing their wealth carted off for someone else’s benefit, the best regimes for maintaining such an order are non-democratic, and there is probably no regime less democratic anywhere in the world than the Saudi royal family. They perfectly deliver the goods to the U.S. and allied economies.
If this were all Saudi Arabia offered they would be very valuable to the U.S. imperialist economy and therefore to the two parties seeking to manage it, but Saudi Arabia offers several other advantages that make them worth the tremendous political and security risks they pose.
First, never before has a country managed to re-center all of the world’s money onto a resource that it not only exclusively controls, but which it actually invented. The United States has done this by tying all of the world’s money not to any physical commodity such as gold or silver, but to the U.S. dollar.
How is this maintained? It’s a complicated answer, but one major tactic is by ensuring that everyone in the world needs to maintain U.S. dollars because it is the only currency used for international petroleum sales. Saudi Arabia is the chief defender of that arrangement, and were it to abandon that it would mean a shift away from dollar hegemony and U.S. power.
The other side of dollar hegemony is that governments and foreign financial institutions need a useful place to park their dollar reserves, which makes U.S. Treasury bonds the most important investment in the world. Saudi Arabia reinvests much of the wealth they collect from industry built by exported U.S. capital back into U.S. debt. The money comes right back into U.S. coffers.
Of course, the most valuable and brutal way for that money to come back is in the form of purchases from our most important domestic industry — arms production. Saudi Arabia is far and away the largest purchaser of U.S. arms, more than twice as much as the second largest customer — Australia — and more than three times the third and fourth countries — the United Kingdom and Israel — combined.
This scenario is the perfect arrangement for an advanced economy like ours. U.S. financial capital is exported to Saudi Arabia where basic extraction and monocultural commodity production can generate even more money, most of which is reinvested back into financial instruments and advanced manufacturing products back in the United States.
The billionaires make money coming and going, and the fact that Saudi Arabia has to find uses for those weapons to justify the expense — slaughtering Yemenis and threatening Qataris and others — only means the money will keep flowing in the future.
Khashoggi’s questioning of Saudi autocracy threatened the entire system. If Saudis could challenge their government they might demand real investment in a broader economy or keeping their wealth at home rather than shipping it abroad.
This erodes that core of U.S. dollar power and risks interrupting the circuit that keeps U.S. bankers and arms makers and Saudi royals among the richest people in the history of the world. This is why they had to murder him, and it’s why politicians from both U.S. parties serving those special interests have very little to say about the mess.
In the end they’d rather we find a way to forget the costs of arming extremists and the lives and dignity of those who dared to remind us. If the headlines and the election results are any indication, they’ve managed to succeed in this task.