Sheikh Donald Soprano
Why Trump is a bigger threat to American relations with the Gulf than is often assumed.
In the mafia TV show The Sopranos, a power struggle breaks out between Anthony Soprano and his uncle, Junior. Junior’s men go to a corner where a local drug dealer plies his trade. They make the dealer pay his protection money to their boss instead of to one of Anthony Soprano’s men. The dealer, a surprisingly good-natured fellow named Yo-yo Mendez, complies.
When Anthony Soprano’s man, Christopher Moltisanti, comes to collect his money, the dealer apologetically tells him that he’s already paid Junior’s men, that he’d much rather pay Christopher, but that Junior’s crew had put a gun in his mouth. It’s business.
What did Yo-yo Mendez get for his docile attempt at facilitating a peaceful transfer of power?
A vicious beating. After which he was robbed and made to pay twice.
The Saudis and the Emiratis, (and, we would argue, many players in Latin America), are in the same position as the drug dealer. For decades, their stability, economy and security depended on American goodwill and support.
Then business changed. China became their biggest customer. They went to China, invested there, and invited Chinese investments. Now, an American administration that is willing to play by the old eternal rules is in power.
The Gulf’s Dilemma
We have long maintained that the US has been a poor security guarantor for Gulf states in the past two decades, starting with George W Bush’s Iraq adventure and his complacency against Iran, followed by Obama’s inability to protect Saudi Arabia’s interests in Yemen, Egypt, Iraq, Lebanon and Syria, followed by Trump’s complacency in the face of Iranian attacks in his first term, followed by Biden’s muddled policies. We explain this at length here:
This led Gulf Arab states to draw closer to China, and even led Saudi Arabia to reconcile with Iran under Chinese auspices (something which we were almost alone in predicting). This was understandable, given that the US was not willing to invest enough in the Gulf, and instead pursued a (highly unrealistic) policy of decarbonisation and hostility to hydrocarbons.
The Gulf states were willing to compromise over Israel, as a way of keeping good relations with the US while accommodating China’s economic rise. However, Israel has made this almost impossible, for three reasons:
Israel is trying to depopulate the northern Gaza Strip and has plans to expand this operation to the West Bank. It has already depopulated large parts of south Lebanon. This has led to a strong public backlash against Israel among the Gulf Arab population. Even UAE media, which is the kindest to Israel, is regularly critical of Israel’s atrocities.
Israel is failing in its objectives. It has succeeded in doing enormous damage to Hezbollah and Hamas, but not enough to stop them rebuilding and re-igniting the conflict in a few years’ time. The Arab states can accept peace, but they cannot openly side with Israel in an open conflict.
Across the political spectrum, Israel absolutely rejects any notion of a Palestinian state. With 10% of its population living as settlers in the West Bank, Israel cannot hand over the West Bank to Palestinian sovereignty. And the Saudis have committed themselves since 2002 to making normalisation contingent on a two-state solution.
With Trump’s appointments making it clear that he is ready to escalate against Iran, that he will not compromise over Israel, that he expects normalisation, and that China is again the US’ top target, Saudi Arabia and the UAE find themselves in a bind. They cannot side with the US, they cannot side against the US, and Trump will not allow them to be neutral. Worse, their interests and those of the United States are quickly diverging.
Commercial Implications:
US policy towards Gulf Arab states is set to become incredibly unpredictable. Trump is planning to sack thousands of civil servants in the State Department and Pentagon, gutting the institutional thinking and institutional relationships that have underpinned American-Arab relations. What new policies emerge from the chaos is anyone’s guess, but we expect the overall result to be a gradual worsening of relations between the Gulf and the United States.