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Chicago Tribune
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As it tries to bring democracy to Iraq and peace to Israelis and Palestinians, the Bush administration has yet to work out a strategy for encouraging reforms in perhaps the most influential Persian Gulf government: oil-rich Saudi Arabia.

Having won a war against the Iraqi regime of Saddam Hussein, the U.S. finds itself an uncertain occupying power in the Middle East, pressing reforms that it hopes will trigger democratic initiatives in neighboring states. But those good intentions could easily backfire in a blast of anti-American sentiment and the further rise of Islamic radicalism.

Such tensions already are at work in Saudi Arabia, where terrorist Osama bin Laden retains some popular appeal, the government is competing against fundamentalists for control of the schools and disdain for the U.S. is widespread. The heart of the Arab world, it is a nation ruled by a closed, fabulously wealthy monarchy, one on the verge of wrenching transition.

Forces inside and outside the royal family are seeking the election of government officials and the adoption of politics that would reduce the influence of crown princes and high Muslim religious figures.

How Saudi Arabia evolves could have a dramatic effect on U.S. hopes for changes in Iraq, Syria and Iran. Whether it becomes a modern state that expands personal freedom and popular rule or remains one where the royal family clings stubbornly to power is the crux.

“The Saudis are going to try hard to maintain a pace of managed change, and our own interests rely heavily on the success of Saudi change,” said Frank Wisner, a former U.S. ambassador to Egypt and India and a director on the U.S.-Saudi Business Council. Wisner said the Saudi government is trying to manage the transition “so that it is not reduced to Islamic radicalism but continues to evolve.”

Managing change or the perception of it are proving difficult. Saudi Arabia is a mass of contradictions driven by the royal family’s need to both mollify critics at home and maintain its influence abroad.

The Saudi government, for example, condemned the U.S. war in Iraq and refused to allow the U.S. to launch planes from Saudi bases against Baghdad. But it quietly allowed the use of military facilities, including a key aircraft control center that directed the bombardment of Iraqi targets.

Interests to protect

The royal family has stonewalled U.S. efforts to hunt terrorists and their associations, particularly leads that implicate Saudi citizens who may have links to Al Qaeda and bin Laden, who comes from a prominent Saudi family. At the same time, the Saudi government and its oil and investment concerns maintain lucrative relationships with American companies and banks and the U.S. government.

American officials say the Saudis have taken steps to shut off funding in Saudi Arabia for militants through charities and other means. But they describe these as beginning steps after years of not paying attention to the problem.

Saudi Arabia has the world’s largest oil reserves, and its production levels profoundly affect world oil prices. Last year, the U.S. imported about 1.8 million barrels of Saudi oil each day, 17 percent of the U.S. oil supply, according to the American Petroleum Institute.

In turn, the Saudis spent $35 billion on U.S arms and defense-related construction from 1990 to 2000, according to the State Department. There also are licensing agreements for $8 billion more in weapons.

Last week Defense Secretary Donald Rumsfeld announced that this summer the U.S. would withdraw the 7,000 or so troops that have used Saudi Arabia’s Prince Sultan Air Base to guard the country against Iraqi invasion. The announcement marks the end of U.S. military presence in the nation that had been America’s strongest Mideast ally in the 1991 Persian Gulf war.

There was no concealing that most Saudis wanted the U.S. forces out years ago. The U.S. is leaving 400 military personnel to assist the Saudis with training, and U.S. contractors will continue outfitting and maintaining Saudi Arabia’s American-made F-15 fighter jets and other military equipment.

“The relationship will continue,” said Jean-Francois Seznec, a business consultant and Saudi expert who teaches at Georgetown University. “For one thing, the Saudis are still dependent on the United States for the maintenance of their enormous arms systems.”

Seznec and other regional experts portrayed the decision to withdraw the U.S. troops as the final break in a relationship that has become seriously strained since the Sept. 11 terrorist attacks amid suggestions that royal family members were financing Al Qaeda while publicly supporting the war on terrorism.

“It’s a divorce of convenience, if you like,” Seznec said. “It’s good for both parties and their agendas.”

U.S. policy a work in progress

The U.S. agenda is far from clear. With its intense focus on Iraq, the administration has left open questions about how it will get Saudi Arabia to adopt reforms and to cooperate more with the U.S. war on terrorism.

Secretary of State Colin Powell recently said: “Democratic values have to ultimately come from within a society and within a nation because they believe that’s the best way for them to move forward. But, you know, we will see how this develops in the various countries of the Middle East and the Persian Gulf.”

But some in and close to the Bush administration view the House of Saud with deep skepticism. Last year, the advisory Defense Policy Board met to discuss Saudi Arabia, highlighting alleged links between royal family members and terrorist organizations. Administration figures such as Rumsfeld quickly insisted that the briefing did not reflect U.S. policy, but the damage was done.

While power in the royal family remains with King Fahd, a debilitating stroke he suffered in 1995 left his 70-year-old half brother, Prince Abdullah, as the de facto ruler. Two brothers, Defense Minister Prince Sultan and Interior Minister Prince Nayef, also are powerful.

Reforms modest so far

Abdullah has pressed reforms for several years, including the election of a shura, or governing council, to make decisions and a measure that would reduce the control of family members and religious leaders over government policy. So far, though, no major changes have occurred.

Until there is a strong leader, and not a caretaker ruler hampered by family squabbles, substantial reforms are unlikely, diplomats in Riyadh say. Saudi officials also are loath to carry out reforms that appear dictated by the U.S. and others, diplomats add.

Time is not on the monarchy’s side. The royal family’s rapid growth–there are now about 15,000 princes–is taking up a disproportionate amount of the country’s oil wealth. Per capita income has shrunk from $18,000 in 1980 to about $7,000 today. That amount may drop further with a decline in oil prices. Iraq, which sits on reserves almost as large as Saudi Arabia’s, is certain to increase production.

Meanwhile, of the country’s 23.5 million people, 42 percent are younger than 14. Many soon will soon need jobs in a nation where menial tasks are left to foreign workers and meaningful careers are controlled by the government, state-run oil companies or the Saudi monarchy.

“Some of that change might be a bit messy,” said Jamil Khoury, an Arab specialist and business consultant who teaches at the University of Chicago. “It might even be a bit bloody. The country is long overdue for some serious change, and there are some competing visions, significantly to the right of the royal family, the religious establishment, Osama bin Laden types, who want something even more austere.”

So far, broad pressure from the Bush administration for the rise of democracies in gulf countries hasn’t had much influence in Riyadh, analysts say. Outside of Iraq, the tools the administration can use to effect the change it wants in any of the Mideast countries are imprecise.

Allegations over Saudi involvement in the Sept. 11 attacks have strained the diplomatic dialogue. But taking a tougher approach with the royal family, such as a reduction in U.S. military and business cooperation, could bring a punitive Saudi response, such as a reduction in oil production–and higher oil prices–or a shift in the billions of dollars in Saudi assets out of U.S. banks and government securities.

“I don’t think the U.S. has any pressure points,” said Robert Baer, a former CIA officer and the author of a book on Saudi Arabia. “The democratic reformers [in Saudi Arabia] are saying that: `You can’t trust the United States. It doesn’t care about democracy in Saudi Arabia. It never has.'”

Wisner, among other Saudi analysts, said the best way to influence Saudi Arabia may be to solicit broad Arab support in the rebuilding of Iraq and to do so with the understanding that the U.S. will leave Baghdad as quickly as possible.

“The responsibility falls on the shoulders of the U.S. and to a lesser degree Britain to make sure that everybody is bid into the hand,” he said.