America's incredible shrinking man

By Gerald Butt ABU DHABI

George W. Bush's Middle East advisers must be burning the midnight oil as they try to figure out what, if anything, to do about the crises in the region. The new president's preference is to be less involved than Bill Clinton in seeking a solution to the Arab-Israeli conflict, concentrating instead on formulating new policies towards Iraq and Iran. In doing so, the Bush administration is acutely aware of America's massive dependence on oil from the Gulf and, therefore, is keen to take whatever steps necessary to maintain security in the region.

Increasingly, however, doubts are being raised in the Middle East and, significantly, among a number of respected analysts in the United States about the effectiveness of current American policies - towards both the Arab-Israeli conflict and the Gulf. Equally, observers are becoming more and more skeptical about the ability of the United States to disentangle the two crises.

Whether or not Bush decides to put as much effort as his predecessor into trying to restart the Middle East peace process, he will not be able to ignore that conflict, even if he wants to, while concentrating on Iraq, Iran and the Gulf. The tentacles of the Arab-Israeli dispute have reached the furthest extremes of the Gulf, as they have the most distant corners in the rest of the region.

Some of these issues have been discussed in two recently published studies in the United States. The first is the product of an independent task force co-sponsored by the James A. Baker III Institute for Public Policy of Rice University, Houston, and the New York-based Council on Foreign Relations. The study, entitled "Strategic Energy Policy Changes for the 21st Century," examines the implications of America's dependence on oil imports - particularly those from the Middle East. The report says that recent US policies - influenced by increasingly stringent environmental legislation - have led to a chronic shortage of investment in the country's own oil industry, leading to a greater reliance than before on other oil sources.

The study warns that "reliance on volatile Middle East oil resources could increase dramatically over the next two decades unless policies are put in place to promote oil development in other regions, to shift to alternative sources, or to rein in unbridled or wasteful consumption. In practice, a hands-off US policy towards energy markets has increasingly led to a dangerous complacency about energy supplies."

Complacency is a constant theme as the report moves on to examine recent US policies towards the Middle East as a whole and their impact on America's relations with the strategically important Gulf states. It notes, for example, that the Gulf states have thus far been willing to provide replacement supplies of crude oil to the global market at times when production from Iraq has been reduced or cut for one reason or another. But the study also warns the Bush administration against complacently assuming that this state of affairs will continue - especially given the anti-American mood in the Arab world as a whole. The Gulf states' role "needs to be preserved, and should not be taken for granted. There is domestic pressure on the Gulf Cooperation Council (GCC) leaders to reject cooperation to cool markets during times of a shortfall in Iraqi oil production. These populations are dissatisfied with the 'no fly zone' bombings [of targets in northern and southern Iraq] and the sanctions regime against Iraq, perceived US bias in the Arab-Israeli peace process, and lack of domestic economic pressures."

Looking ahead, the report says that "a diplomatic dialogue that emphasizes common US-GCC goals and programs should be pursued at the highest levels to minimize the potential over these issues [listed above]. . . . Bitter perceptions in the Arab world that the United States has not been evenhanded in brokering peace negotiations between Israel and the Palestinians have exacerbated these pressures on Saudi Arabia and other GCC countries and given political leverage to Saddam Hussein to lobby for support among the Arab world's population."

To put it another way, America's diplomatic involvement in the two areas of crisis in the Middle East has become entangled. Enmeshed with them, too, is America's sanctions policy. The task force said the United States had frequently stated its desire to see new acreage around the world opened to oil and gas exploration, but had failed to match its words with actions. "On the contrary, it has frequently used energy sanctions as an instrument of foreign policy, blocking targeted countries from trade and investment, while making energy goals secondary to other foreign policy objectives. . . .

US unilateral sanctions as well as multilateral sanctions against oil-producing countries have discouraged oil resource investment in a number of key oil provinces, including Iraq, Iran and Libya." The report, in its list of long-term initiatives recommended to the Bush administration, states that the United States should "review Iraq policies to lower anti-Americanism in the Middle East and elsewhere; and set the groundwork to eventually ease Iraqi oilfield investment restrictions."

Separate tracks. Another recommendation is that "while moving to diffuse tensions in the Arab-Israeli conflict through conflict resolution and negotiations, [the United States should] maintain energy and political issues in US-Middle East relations on separate tracks." A fine recommendation on paper. But how is it to be turned into action? Anything short of a major shift in Washington's policy towards Israel and the emergence of a more evenhanded stance will fail to dispel the growing unease being felt by the United States' Arab allies - in the Gulf and elsewhere. Newspaper commentaries across the Arab world - not least in the Gulf - reflect the frustration and anger felt towards the US administration.

In the last week of April, the Abu Dhabi daily Al-Ittihad, in an editorial typical of those being written across the region, berated Arab states for failing to act on calls for a boycott of links with Israel, saying it amounted to "a total Arab submission to US pressure." The Dubai daily Al-Bayan, two days later, attacked the United States, accusing it of turning a blind eye to "Israel's terrorist attacks" on Palestinians. The mood on the streets of Arab cities - from Morocco to the Gulf - is becoming more agitated by the day.

American complacency towards its allies in the Gulf at a time when US policies are under attack throughout the region is highlighted in the second of the two recently published reports. This takes the form of an article, "Beyond Containment in the Persian Gulf," written by Rachel Bronson of the Council on Foreign Relations. Bronson, a contributor to Arabies TRENDS, points to what she says is the failure of the Clinton administration's policy aimed at containing both Iraq and Iran, saying that a totally wrong approach was adopted.

"A key problem is that the Clinton administration pursued a strategy in the Gulf that was almost entirely reliant on military-to-military relations and did not articulate any positive social, economic or political vision for the region. In other words it failed to create local incentives to support US policy, the essence of a successful containment strategy. To make matters worse, this military approach was put forward at a time when Gulf states themselves were desperately seeking social and economic solutions to their growing domestic problems."

The author lists the challenges facing the Gulf states as "deep structural problems, burgeoning populations, unpredictable economic growth rates, an unstable oil market, domestic debt, outdated education practices, and immense expatriate labor problems," all of which are "becoming impossible to ignore and could undermine close security relations."

Nightmares. Bronson warns that if these issues are not addressed, there could be two possible outcomes: the first is revolutionary change, which she says is "a small but significant possibility, and it would be nightmarish"; and the second, more likely, outcome would be the "continued fracturing of the Desert Storm coalition" leading to "increasing constraints on US action." Against the background of worsening Arab-Israeli violence and criticism of American attitudes towards it, leaders in the Gulf region "are already facing intensifying pressure from their populations to distance themselves from Washington's Gulf policy. . . . The security benefits that the United States provides are not evident on a day-to-day basis, but the growing social and economic problems are."

Coping with all these challenges while the Arab-Israeli conflict and the Iraq crisis remain unresolved, Bronson says, is proving difficult for Gulf leaders.

Young people are using protests against the Israeli-Palestinian confrontation "to express concerns about their own domestic problems." She goes on to quote Abdelbari Atwan, the editor of Al-Quds al-Arabi, as saying: "The Arab armies are not going to fight Israel, of course. Nor are they going to lead the process of change within individual Arab countries, and if they do it will be for the worse."

Bronson believes that the new Bush administration will need to make a concerted effort if the administration is to speak with a single voice to "convey the message that strong US-Gulf ties are important to the immediate interests of dealing with Iraq and Iran, and the long-term interests of ensuring the free flow of oil, freedom of navigation and regional stability."

In conclusion, the author says that leaders in Washington "have been, and will no doubt continue to be, preoccupied with the Palestinian-Israeli conflict, Iraq and Iran. It is time that US priorities reflect the reality that a flexible strategy throughout the Middle East presupposes support in the Gulf, which cannot and must not be taken for granted."

It is possible that if the Bush administration heeds the advice of analysts like Bronson and broadens its relationship with the Gulf states, instead of concentrating on military ties, the leaders in the region will be better equipped to deal with rising unemployment and other social issues that threaten to boil over into popular unrest. But changes brought about by a new, broader relationship will be little more than superficial while the Arab-Israeli conflict lacks a solution regarded by the Palestinians and all other Arabs as fair and just.

It is important that President Bush's advisers, as they work into the night formulating a new policy towards the region, realize that while the central Middle East conflict remains unresolved there is no absolute guarantee either that the status quo in the Gulf will continue or that the oil lanes will remain open and safe. The Bush advisers should not pretend that the United States can detach its energy concerns in the Middle East from its overall policy towards the region - to do so is simply to squander the midnight oil.