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Page added on May 15, 2020

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Saudi Arabia loses its wealth

Public Policy

On Monday, Saudi authorities announced unprecedented measures to salvage its finances from an imminent meltdown, caused by mismanagement rather than simply the coronavirus pandemic or the collapse of oil prices, Middle East Eye writes in the article Saudi financial crisis will spark resistance to plundering of state. From July, an increase in VAT from five percent to 15 percent and the suspension of the cost of living allowance (a monthly 1000 rials/ $266) are both desperate attempts to rescue an economy that has been plundered for generations. 

The ultimate solution

This move is just the beginning as the government may resort to the ultimate solution, by slashing jobs in the Saudi public sector, cutting the salaries of existing state employees or simply finding itself unable to pay them at all. With oil prices showing no sign of improvement, and the coronavirus still raging across the globe and inside the country, it is not certain that the new increase in VAT and the suspension of living allowance will generate enough savings for the state to compensate for serious losses. However, both new measures are desperate attempts to shore up revenues at a time when the main commodity, oil, is increasingly becoming cheaper than water in the desert kingdom. The political implications of the crisis surpass these limited and desperate measures that in themselves will never be enough to halt the slide towards the unknown.   The so-called Saudi social contract is believed to rest on a bargain. The government provides extensive services such as jobs in the public sector, education, housing, and health. In return, citizens continue to pledge allegiance to the leadership.

Ideology vs economy

Throughout the last century, most opposition to the Al-Sauds was articulated in ideological terms not especially connected with the domestic economic wellbeing of the people. Both Saudi Arab nationalists and Islamists launched ideological challenges to the state based on a discourse that touches on the identity of the state rather than its economy or finances. Nationalists challenged it on the basis of its connections with imperialist and Western projects, while Islamists preoccupied themselves with questions of authenticity, Islamic heritage and commitment to global Islamic revival, seeing oil in the hands of the state as an enabling mechanism to pursue such projects. Under such grand ideological projects, and while the state continued to pay citizens’ salaries and provide sub-standard services, the mismanagement of the economy continued and was elevated to new levels.  However, with renewed economic hardship and falling living standards, brought about by the squandering of wealth in the pursuit of futile projects, and the imposition of new taxes, critical voices may be alerted to new conditions that touch upon their own life.

Where did all the money go?

Domestically, from Vision 2030, National Transformation Programmes, to futuristic cities, billions of dollars have been wasted without any form of accountability. Saudis are certain to lose their enthusiasm for grand mythical projects that are the product of a sinister propaganda machine and the grandiose illusions of the crown prince.   Now the leadership is asking Saudis to tolerate austerity measures.  The leadership remains silent over the secret cost of such salaries that thousands of idle princes receive every month. Regionally, spending billions on derailing the uprisings in several Arab countries and launching a war in Yemen only accelerated the depletion of wealth.

A new era

As Saudis are subjected to new taxes and cuts, it is time for them to shift their focus away from issues of identity toward their own destiny. The gradual erosion of state services and salaries, coupled with rising consumer prices, and the prospect of prolonged poverty, will be the spark for a new era of opposition politics ushered in by the disastrous mismanagement of the state under its current leadership.

vestnikkavkaza



66 Comments on "Saudi Arabia loses its wealth"

  1. Davy on Sat, 16th May 2020 6:01 pm 

    Go Trump! Anyone but whoever?! My goat and I are considering volunteering for the Trump campaign to fight the narcissistic, psychopathic whoever they pick.
    I think I could use my antisocial, psychopathic, sociopathic skills to convince people to vote for Trump. I can be very annoying when I want and I am excellent at alienating people.

  2. makati1 on Sat, 16th May 2020 6:01 pm 

    It is a shame the site owner doesn’t cut certain people off and prevent the immature time wasting bullshit they paste here because they have no life. Juan is the number one offender and is getting more and more insane every day. He is too stupid to post anything original or intelligent.

  3. JuanP on Sat, 16th May 2020 6:01 pm 

    Fuck off old man, I can do what I want.

  4. makati1 on Sat, 16th May 2020 6:03 pm 

    Go Trump! Anyone but whoever?! My monkey and I are considering volunteering for the Trump campaign to fight the narcissistic, psychopathic whoever they pick.
    I think I could use my antisocial, psychopathic, sociopathic skills to convince people to vote for Trump. I can be very annoying when I want and I am excellent at alienating people.

  5. JuanP on Sat, 16th May 2020 6:03 pm 

    Mak, go fuck you monkey please

  6. makati1 on Sat, 16th May 2020 6:04 pm 

    Juan, I did already last night

  7. makati1 on Sat, 16th May 2020 6:07 pm 

    I confess I am the reason this sight is now in the gutter. I have done nothing now for 7 years but be hateful with lies and embellishments.

  8. JuanP on Sat, 16th May 2020 6:09 pm 

    Mak, I have upped you on that. I have been here as long as you but the last 2 years I have done the most damage. I am proud as a peacock about it too.

  9. makati1 on Sat, 16th May 2020 6:35 pm 

    My last comment was 6:03 PM. The rest are JuanP.

  10. Davy on Sat, 16th May 2020 6:48 pm 

    JuanP is me makato. And so are you.

    stupid

  11. Davy on Sat, 16th May 2020 7:02 pm 

    It is a shame the site owner doesn’t cut certain people off and prevent the immature time wasting bullshit they paste here because they have no life. I have to admit, I am the number one offender and I getting more and more insane every day. I is too stupid to post anything original or intelligent.

    Please ban me. For the good of the site.

  12. makati1 on Sat, 16th May 2020 7:40 pm 

    6pm, my last post. 7am Sunday here. Going off-line until afternoon, my time.

    Insanity rules the PO site and it is obvious that it is allowed because the hits make more $$$ for the site owner. Too bad he is so greedy that he doesn’t see that it is killing the golden goose.

    The West is going down faster every day. The East is rising slowly but surely to future dominance. Twist that if you want kids, but everyone knows it is true, except brainwashed, dumbed down Amerikan tax slaves. Fun to watch from far shores this sunny Sunday morning. ^_^

  13. JuanP on Sat, 16th May 2020 8:47 pm 

    Mak, I am sorry, when I troll Davy you always seem to get mixed up in the mindlessness. I can’t stop trolling Davy because I am obsessed with him. Maybe you should leave PO dot com before you turn into somebody like me.

  14. Davy on Sat, 16th May 2020 9:59 pm 

    Mak, I am not the least sorry for trolling you in my mindlessness. I cant stop trolling JuanP or any of the other intelligent posters because I am obsessed with him. Maybe I should leave Po dot com before I turn into a total davyskumbag.

  15. makati1 on Sun, 17th May 2020 1:06 am 

    It is a sunny 92F here in the land of eternal summer. The birds are singing. Flowers blooming. A slight breeze to keep the bugs away. A perfect day!

    Meanwhile, back in the corona infested Amerika… ~90,000 deaths from the beer flu first 20 weeks of 2020.

    Also in the first 20 weeks:
    Hearth disease deaths = ~130,000
    Cancer deaths = 120,000
    Accidents = 30,000
    ETC.

    Fools and their freedoms are soon parted. LOL

    BTW: The Philippines has <1/3 the US population but only 817 REAL COVID-19 deaths and the kinda lock-down is starting to lift.

  16. Cloggie on Mon, 18th May 2020 2:59 am 

    “Saudi Arabia loses its wealth”

    Good news for both Australia as well as Saudi-Arabia:

    https://deepresource.wordpress.com/2020/05/18/australia-to-become-renewable-energy-super-power/

    “Australia to Become Renewable Energy Super Power”

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