Obama, accompanied by his Defense Secretary Ashton Carter, was said to reassure King Salman about the strategic bonds between the two countries dating back to a historic meeting in 1945 between President Franklin D Roosevelt and the founder of Saudi Arabia, Ibn Saud (father of the incumbent monarch).
Talking up mutual contemporary concerns, Obama and his Saudi hosts focused on checking alleged Iranian meddling in the region and supposedly on the defeat of Islamist terror groups.
The effort at patching up relations comes after the US president disparaged the Saudis and other Middle East monarchs as «free riders» on American benevolence in a high-profile interview last month for the Atlantic magazine. Obama complained that Saudi Arabia and others have enjoyed US military protection for too long and need to start contributing more in the way of deploying their own forces in the region.
As if that wasn’t bad enough. The Saudi rulers reacted furiously when it emerged last weekend that a bill going through the US Congress could give families of 9/11 victims the right to sue Saudi Arabia in a federal court. If, that is, evidence showed a state link to the atrocity in 2001 when some 3,000 American citizens were killed. Families and campaigners believe there is an incriminating connection to Saudi rulers over the terror attacks because 15 of the alleged 19 attackers were Saudi citizens.
The Obama White House subsequently said that the president would veto the legislation if it gets passed by Congress, citing concern that the precedent of removing sovereign immunity could place US citizens and government at risk of future legal prosecution.
Weighing in heavily on the White House position was also the extraordinary threat issued by the House of Saud that if the 9/11 legislation were to become enacted then Saudi Arabia would sell off its massive holdings of US treasuries. The Saudi foreign minister Abed al-Jubeir warned that up to $750 billion of US securities and other assets would be dumped.
That move could be nothing more than a royal bluff by the Saudis. Some commentators and even US officials expressed disbelief that the Saudi rulers would take such a drastic measure as it could rebound badly to destabilize the fragile Saudi economy, which has fallen on hard times anyway over sinking oil prices and its costly war in Yemen.
Nevertheless, in theory at least, the threatened Saudi sell-off of US treasury bonds would strike a debilitating blow to the American economy. This gets to the heart of the US-Saudi strategic relationship. That relationship revolves around the world’s biggest oil exporter trading its commodity solely in dollars in perpetuity. The US-Saudi petrodollar system means that the rest of the world is obliged to follow suit in using the American greenback as the standard financial means of transaction. That is the basis for the dollar being the world’s reserve currency and it allows the US to continue printing dollars and forever running up a gargantuan national debt (now at $19 trillion).
Recently, crevices in the petrodollar monolith have begun opening up, with Russia and China agreeing to trade in oil and gas using their own national currencies. Also, Iran has moved towards selling its oil to Europe by accepting the euro.
So, the petrodollar system, which is the lifeline for the chronically indebted US economy, may continue for the moment to dominate, but it is in a perilously delicate balance.
That’s why the Saudi threat to sell off US debt holdings resonated with such trepidation when it was announced this week. It is also why, at least partly, the Obama administration emphatically expressed that it would quash the 9/11 legislation wending its way through Congress. (Another reason is that Washington fears any criminal probe against Saudi involvement in 9/11 might also expose collusion with American intelligence in perpetrating an inside job for strategic interests.)
In any case, here is the takeaway. The Obama White House just got the Saudi blackmail treatment. The thrust of this is: tell your citizens to back off awkward litigation or else we’ll pull the plug on your economy and bring you down in ignominy with us.
Despite the veneer of patch-up and can-do alliance this week in Riyadh between Obama and King Salman one amusing upshot is this: Obama finds himself in the same unseemly position as Syrian President Bashar al-Assad, Moscow and the Yemeni revolutionaries led by the Houthi rebels.
All of these parties are being subjected in one way or another to the Saudi modus operandi of diplomacy-by-blackmail.
On Syria, the Saudi-backed opposition group, the High Negotiations Committee, has said this week – yet again – that it is quitting the Geneva peace talks because its ultimatum of Assad «stepping down» has been repeatedly rebuffed.
Syrian government chief negotiator Bashar al-Jaafari deprecated the HNC (also known as the Riyadh group) for holding the Geneva process to ransom by making such high-handed, maximalist demands.
Russia’s deputy Foreign Minister Sergey Ryabkov also excoriated the HNC for its «blackmail tactics». Additionally, Ryabkov accused the HNC for exploiting a surge in violence around the Syrian city of Aleppo as a means to undermine the shaky ceasefire.
The HNC is a diplomatic creature of Saudi Arabia. It was formed in Saudi capital Riyadh last December at the instigation of the Saudi rulers in order to present a political front for various regime-change militant groups. The HNC is dominated by Jaysh al-Islam and Ahrar ash-Sham, both of which nominally signed up to the ceasefire brokered by the US and Russia on February 27. Although both of these groups are enmeshed with the officially designated terror groups, al-Qaeda-affiliated Jabhat al-Nusra and Islamic State (Daesh).
Jaysh al-Islam and Ahrar ash-Sham are funded by Saudi Arabia, Qatar and Turkey. Washington has given its political support to the HNC, which is dominated by the two militant groups, even though there are organizational links to the officially designated terrorist brigades.
Meanwhile, in Yemen the same tactic of diplomacy-by-blackmail is also extant. Peace talks are due to get underway in Kuwait between, on the one hand, Saudi Arabia and a faction loyal to the ousted Saudi puppet-president Abd Rabbuh Mansur Hadi, and on the other hand, the so-called Popular Committees led by the Houthi rebels.
A ceasefire purportedly came into effect in Yemen on April 11 to pave the way for peace talks. However, the Houthi-led Popular Committees claim that the Saudi aerial bombardment has continued unremittingly, despite the official declaration of ceasefire. The rebels rejected Saudi demands for their retreat from formerly loyalist-held territories and the laying down of weapons as a precondition for political negotiations. It is claimed that is why the Saudi air raids have continued – as a means of pressuring the Houthis to make concessions at the negotiating table. In other words, blackmail under threat of violence.
Talks are now set to resume in Kuwait after the Yemeni rebels reportedly received a guarantee by the United Nations envoy that Saudi forces would respect the ceasefire and desist from violence.
The unmistakable pattern here is the use of blackmail by Saudi Arabia as a means of achieving political goals. Blackmail plus coercive violence.
While the Yemenis, Syrians and Russians have by now become seasoned observers of this low-ball Saudi way of doing politics, US President Obama – the long-term strategic ally of Saudi Arabia – appears also to have undergone an initiation of sorts this week.
Smiles and handshakes between Obama and King Salman in Riyadh this week belie the sordid reality.