Saturday, February 14, 2009

How the Arab Lost the Battle: A Prologue

I am writing a new book. I will be sharing here parts of the book as it develops.






Prologue

It was July 2005 and I was in Newark, New Jersey at its airport heading to Paris on one of my long flights. As I normally do I stopped in one of the bookstores searching for a travel companion. My eyes landed on Jared Diamond’s “Guns, Germs, and Steel – The Fate of Human Societies.” I couldn’t resist the book and I took it over for the long trip. In July 1971, Jared Diamond was walking along a beach on the tropical island of New Guinea, where he was studying bird evolution. Dr. Diamond got acquainted with a local politician named Yali. At that time, New Guinea was administered by Australia although it later became the independent state of “Papua and New Guinea.” Two centuries before that, the Whites had arrived, imposed centralized government, and brought material goods whose values New Guineans instantly recognized, ranging from steel axes, matches and medicine to clothing, soft drinks, and umbrellas. In New Guinea, all these goods were referred to as “cargo.” Many of the white colonialists openly despised New Guineans as primitive. Even the least able of the white colonialists enjoyed much higher standard of living than native New Guineans, higher even than a local politician like Yali. Yali asked Dr. Diamond the penetrating question: “Why is it that you white people developed so much cargo and brought it to New Guinea, but we black people had little cargo of our own?”

It is a simple question. Yet it is difficult to answer.

The same question has mesmerized me but in a different form and more related to my origins. Why did the United States invade Iraq and not Iraqi troops storming Washington, DC? Why is it that Saddam Hussein was a ruthless dictator and not George W. Bush? Why did Britain develop a parliamentary democracy and not Syria for example? Why did the Arabs militarily lose most of their contemporary wars with the Israelis? Why did General Allenby enter Damascus at the end of World War I and not Sherif Hussein of Hejaz entering London?

I can push the questions even further. Gross domestic product per capita is the broadest measure of wealth creation by each individual. Why is that the per capita gross domestic product of all Arab states is less than that of Spain or Italy or Israel?



Why is Egypt poor and Israel rich, while the share a boarder? Why is Morocco poor and Spain rich even though they are merely separated by the narrow straits of Gibraltar? Why is it that despite its oil wealth, Saudi Arabia is still considered a developing country and nobody considers it among the world’s industrialized nations?

Why is it that Egyptians are the ones flocking on boats to immigrate to Italy even in the face of uncertain fate and possible death? Why not the Italians flocking on boats to immigrate to Libya for example?



The question is really a matter of wealth and power? Why do Arabs remain far behind in wealth and power compared to Europeans and many Asians?

Why are we asking these questions? Don’t we know the answer already? Isn’t it a conspiracy by the Jews, Europeans, and Americans to create Israel, divide the Arabs and keep them backward? Even if that is so, why is that Jews, Europeans, and Americans mustered the power to do so? Why the stealth airplane that pounded Iraq upon the 1991 Gulf War was developed in the United States and not in Iraq or in Egypt? We can push the question even further? Egypt had a nascent aircraft industry in 1965 only to have the factories destroyed by Israel in the 1967 war. Why did the Israelis destroy the Egyptian aircraft engine factories and not the Egyptians bombarding the nascent Israeli nuclear facility in Dimona? One can argue that the Egyptian army and its leaders were incompetent and were taken by surprise? But why the Israelis surprised the Egyptians and occupied Sinai and not the Egyptians surprising the Israelis and occupying the Negev desert? One can argue the reason is Arab dictators monopolized decision making and made disastrous miscalculations. But, why Arab dictators have always made these miscalculations? Why did Arab countries develop dictators? Why doesn’t England for example develop its own dictators and make similar disastrous miscalculations? The answer could be that if that ever to happen in England or in the United States, people would rise to depose the rising dictator? But why doesn’t that happen in the Arab world? Why don’t Arab masses rise to depose their dictators and when they tried to do so in Iraq against Saddam or in Syria against Hafez Al-Assad they were terribly unsuccessful, while in England the rise against King Henry led to the creation of the Magna Carta and the establishment of a constitutional democracy in England? Is it because Arab masses are less educated? But England in the 1100’s and 1200’s was not more educated than Arabs now? And even if Arab masses are less educated than their western peers, then why? Why is it that literacy rate in Egypt is not 100% while in Korea or Switzerland is very close to that? One can argue that the Magna Carta was created by the nobility in England and not by the English masses? If so, why didn’t a nobility natively develop in Egypt? Why didn’t the Memluks rise and create their own Magna Carta in Egypt?

Another potential answer to the question is that Europeans discovered wealth in America in 1400’s and 1500’s and therefore they grew their wealth and power? But why didn’t Arabs discover America? They didn’t because the Arab rule in Spain decayed because of massive infighting. But if we pause for a second and if we remember our history lessons, Spain launched Columbus campaign after Italy refused to finance it. So, the Europeans were also divided. Certainly the history of Europe is full of division, infighting, and bloodshed on massive scales, the most recent of which is World War II. Why did Arabs in Spain were divided to paralysis while the European who were also divided were successful in discovering America?

Another potential answer is to go back to race a religion. Don’t we already know the answer that Arabs are racially inferior to Europeans? That something in their genes makes them unable to comprehend progress and modernity? Another potential answer is in religion. Islam as a religion is innately against progress and modernity and therefore held back the progress of Arabs and Muslims. Don’t you see how Muslim youth throw themselves to suicide and kill along thousands of others in anticipation of the promised Muslim paradise after death? Isn’t 9/11 the true emblem of Muslim doctrine? But is that really true? And even if that is true, what led to Islam being that way? Is race a factor? If so, why is it that some Arabs excel when they immigrate outside their own countries? If Islam is that bloody and that inferior to Christianity, why is it that more than a billion people around the world continue to believe in it? Is it because they are ignorant and they simply do not know? If it is a matter of religion only, why is it that Christians in Egypt are poorer than agnostics in Holland? Why Jews in Yemen are far poorer than Jews in New York City? Egypt lost its status as the center of civilization long before Islam entered Egypt? Why did Egypt lose to Rome about a thousand years before the birth of Christ and well more than 1600 years before birth of Mohamed and Islam? This was well before Egypt became a Muslim country and well before Arabs entered Egypt and transformed its landscape?

Is the answer to that is simply the cyclic nature of history? That inhabitants of Western Asia and North Africa lost their status to the Europeans, then the Europeans lost it to the Americans and that the Americans are gradually now losing it to the East Asians and so on and so forth. That who has wealth and power is in a state of constant change. That the Islamic and Arab civilization achieved its peak while Europe was in the dark ages, then the center of learning gradually moved to Europe. But if that is true, how does it happen? Is just that the center of civilization revolves around the world and you just have to be at the right place at the right time? What prevented Arabs from holding to power longer and prevent their own decay? Why that is even at the climax of Arab civilization, they failed to capture Rome or invade France, while the Europeans invaded Baghdad, Damascus, Jerusalem, and Cairo? Is it because the Europeans are more blood thirsty and looking for expansion while Arabs were not? Why is it then that Arabs certainly tried to conquer France and failed twice or capture Rome and could not advance?

As I am sitting now writing this book during the last days of 2008, Israel is pounding Gaza strip with airstrikes? Why Israel attacking Gaza while Gazans are failing to mount an equally devastating counter-attack on Israel? Is it the treachery of Arab governments who left the hapless Palestinians to their fate? But yet again, why are Arab governments treacherous? An easy answer is that because the powers to be (America, Jews, or Freemasons) in the world have put those Arab governments in place to subjugate the Arab masses and prevent their progress? But why Arabs accepted that fate? Why do Europeans conspire on Arabs and not Arabs conspiring to dislodge Europeans?

Another common explanation involves the supposedly stimulatory effect of cold climate compared to the hot humid climate of the Arab land. Although popular this type of explanation fails to survive scrutiny. People of Northern Europe contributed nothing of fundamental importance to human civilization until the last thousand years. Also, Native Americans living in what is now the United States failed to develop a lasting civilization in the very cold climate of the US North East that is now one of the centers of world civilization. Why is it that Europeans settlers in that stimulatory cold climate achieved what the native inhabitants failed to accomplish in the same stimulatory cold climate? Why is that inhabitants of Phoenix, Arizona or Western Texas are wealthier than inhabitants of Aswan or Luxor even though they share similar climate?

Another type of explanation lies in the immediate factors that enabled Europeans to kill and conquer other people especially guns, tools, and technology. However, this hypothesis is incomplete since it offers only a proximate (first-stage) explanation identifying the immediate causes. It invites a search for the ultimate causes, the true root causes? Why do Israelis or Americans rather than Egyptians or Iraqis the one to end up with guns, tools, and technology?

The obvious answer to our question is that some people developed and acquired guns, tools, and technology and also developed sophisticated economic and political structures while other people did not. This is an immediate or proximate reason. The ultimate reason is to answer the question, why Europeans developed guns and not the Arabs? Why democracy emerged in England and not in Syria.

In this book, I will be looking for the primary root answers of these questions; the ultimate reasons. I intend to explore the innate reasons and keep asking why until we reach the true cause behind the disparity in wealth and power between Arabs and other wealthier nations. We will be on a journey to explore the broadest patterns of history. Is biology, or environment, or geography, or a collection of all the above the primary reason for the broad pattern of history?

Authors are regularly asked to summarize a long book in one sentence. For this book, here is such a sentence: “why did history follow the current pattern and why it resulted in Arabs losing and Europeans winning?” It is only when we understand the primary reasons that we can answer the second question in the book’s title: “how can Arabs recover?”

This book is divided into 5 chapters. In the first one we will explore several of the modern encounters between Arabs and Europeans. We will try to understand Napoleon’s Egypt campaign, Nasser and Israel wars, Allenby’s campaigns in Palestine during World War I, and the US invasion of Iraq. We will try to understand the common thread between those encounters and the proximate reasons leading to Arab’s losses.

In Chapter 2, we will need to go back in history to a point that I will call the “Starting Line.” This is the point in which Arabs on one side and Europeans on the other had similar wealth, power, and ambitions. I will argue that in around 600-700 AD, both Arabs and Europeans had at least on the surface comparable chances at winning the race. We will explore why it appeared to be so and how events turned very differently afterwards. I will even argue that the seeds of today’s historical patterns and disparity in wealth, power, technology, and culture were laid around that time. In this chapter we will go back one step beyond the proximate reasons of chapter 1 into what can be called the intermediate reasons.

In Chapter 3 we will go to the ultimate reasons or the final destination of our journey. We will explore the effect of the environment, biology, and geography that led to the social, political, and economical constructs of 600-700 AD and that developed into the pattern of history we live through till today.

In Chapter 4, we advance the clock back again to modern times and trace Saddam’s and Nasser’s encounters with the West from their proximate to intermediate and finally to the ultimate reasons. We finally close the circle and understand the broad patterns of history affecting the Arab World.

Finally, in Chapter 5, we pause for a moment after a whirlwind tour of history and geography and attempt to answer the second part of the question: “Now, what? How can Arabs recover?”

On the Economy, Obama, Hillary, and Middle East

How We Got Here

Here are the top reasons for the economic meltdown and how they will be solved:

1- Greed + extreme experimentalism. That is nothing new. It happened before. Extreme experimentalism is a feature of American capitalism.
2- Feds and treasury were unable to identify enough capital at the right time to fix the problem thus allowing Lehman to fall and creating a crisis of confidence. The last time this occurred was in 1989 and Greenspan and NY Fed were able to assemble equity pumping and lending into the freezing credit market. This time, they were unable to do so. This time all the liabilities from credit default swaps were 6B. This is nothing really and should have been dealt with early on. The fed inaction and letting Lehman collapse created panic in the market that was unwarranted. The losses due to the sub-prime mortgage in Lehman were probably bigger than in 1989 and couldn’t be just covered by ensuring liquidity is available. I need to check on that but I doubt it. Now, let us turn to why the Fed was unable to deal with it before it became public:
a. Lehman losses went with no attention for a long time. Just incompetence from the Fed.
b. Ideology has gripped the Bush administration. Many in the administration like Hoover believed that the best way is to let market forces deal with the situation.
c. The Koreans at the end didn’t want to pump cash into Lehman because the rumors were everywhere and they got a cold feet. In the 1989 crisis, the Saudis interfered but given the relationship between King Abdullah and the US, it is unlikely they will interfere now. Therefore, it had to be dealt with and dealt with publicly.

The origin of the issue is the subprime mortgage and that was left unattended for a long period first under Alan Greenspan then when the collapse started Bernake was unable to comprehend or deal with the problem. A lot of people took mortgages that they were unable to pay and with declining productivity in the economy and freezes on hiring, they were unable to pay those mortgages. The ideological Bush administration was crippled and unable to deal with the issue at a policy level. Iraq obviously has sucked the oxygen out of everything else. The right solution to it was to create jobs for those people who couldn’t work under mainstream capitalism like in roads and bridges so they stay in their jobs. Instead the Bush administration gave people tax rebates in their hands to spend on items imported from China. This didn’t help the economy in any way. It was simply a bribe.

How to Fix It?

1- You have to create quick jobs in the economy by pumping $ into public works.
2- Restoring confidence by showing there is a steady hand at the wheel.
3- Create major incentives for renewable energy development and research. This will have to be a huge incentive package for renewable energy so you create jobs in those areas. Same for buying hybrid cars. Next car that any American buys should be a hybrid car.
4- Reduce spending on almost everything else, including winding down the Iraq war. Iraq according to the Obama plan will become an ethincally and sectly segregated country unless Iraqis themselves think otherwise, which all indication from the Iraqi leadership say they are very sectarian. Therefore, the American military will create isolated zones. There will be no talk of splitting oil revenues since the US has limited bargaining power with the Shiite now. The Saudis will get even unhappier unless the focus completely shifts to solving the Palestinian problem. The appointment of Gates as secretary of defense signals that this is the plan for Iraq and Gates is very supportive of resolving Arab/Israeli conflict as well.
5- This finally leads to be able to stay in the Middle East at low cost by solving the Arab/Israeli conflict. Here lies the problem. Israel will very likely shift right wing in the next elections. Not only because of mood but because many of the neo-conservatives leftovers are going there to promote Benjamin Netanyahu. This makes Obama’s job much more complicated since Mr. Netanyahu will likely stall, talk tough on Iran (but do nothing) to embarrass the US president. Obama will do himself a good service by dispatching people to Israel to swing the elections otherwise. However, given the current crisis in Washington this is unlikely. Therefore, the likely outcome in the Middle East is to engage and try hard to appease the Saudi and if things move, ok, if not, that is fine. This is why the selection of Hillary Clinton is brilliant because she is the most tenacious (remember the primaries), she doesn’t despair, the Israeli lobby and neoconservatives cannot uncover any baggage for her anymore than what they already did, and it will be hard to say No to a woman like her; women actually get these things a lot better than anybody else. She is also well-liked in the Middle East, along with her husband. It is also the best chance to start the negotiations from where they left off under Bill Clinton. She is the real hope now to get the Arab/Israeli conflict resolved. The coming game will be Hillary vs. Netanyahu. For Obama, if it doesn’t work, then Hillary is burnt anyways and the most intractable conflict in history will most likely consume her and her husband’s energy well beyond Washington. This way she leaves Washington for him, which is the best position for the new president.
6- The crisis will be an opportunity to do several things:
a. Reduce consumer and company debt in the US.
b. Lower raw materials prices, which were causing severe long term harm to the US economy. This also put in check nations like Russia. China, India, and Brazil are actually likely to continue growth and that is good for the US in geopolitical terms. For China, see point d below.
c. Re-structure the financial system. There will be a lot of clean up to be done in the next 3-4 years.
d. Re-structure the manufacturing sector in the US especially car manufacturing to focus on technology. There will be some pain primarily lost jobs but that is a price that makes Wall Street happy and finally puts auto-manufacturing on the go. The other opportunity is to reduce the forces of globalization especially moving manufacturing jobs to China. This will take some guts but this is the right time to do it. This is where Obama can spoil it because if you slow it too much you reduce productivity and if you let it go at this pace you make globalization too painful.

What does that mean for Egypt and the Arabs?

1- Iraq will cease to be a political force in the Middle East for a very long time to come and might even be permanently.
2- Hillary will be the game in town. Obama is unlikely to invest presidential capital in the 1st term on Middle East politics especially if Netanyahu is elected unless the deal is almost done.
3- Hillary is driven and will be looking for those who can deliver the deal for her. A deal in the Middle East raises her stature so much, her job to be next president will become easier. The problem is that Arabs cannot do that for her. Surprisingly, the Arabs who can deliver for her are the Israeli Arabs if an Israeli leader is willing to make a coalition with them. That wont happen unless there are US assurances that it is the final game. This may actually happen but it has a low probability. Therefore, Hillary may come in and force a deal that appeases Arabs but does not really consult with them.
4- The Mediterranean union may wane and collapse under its own weight. However, Europeans will need diversified energy. Solar thermal leadership in North Africa can actually pay dividends. Europeans have always been narrow minded about working with North Africa. In all likelihood, they will continue to be so and be hostage to the Russians hiding behind NATO and American leadership.