THE MIDDLE EASTERN FLU: First It Hit Tunisia—Then Egypt—Then Jordan—Then Yemen—Then . . . ?

Tunisia started this round of Middle Eastern Flu: Food inflation, lack of jobs, reaction to institutionalized corruption, curtailed freedom of speech, and generalized discontent led protestors to march on the streets—and a violent reaction from President Zine El Abidine Ben Ali’s regime which ultimately backfired, and resulted in Ben Ali’s fleeing to Saudi Arabia.

First Tunisia, then Egypt, then Jordan,
then Yemen, then . . . ?

Then the contagion spread to Egypt: President Hosni Mubarek’s regime came under intense public pressure for similiar grievances as Tunisia—food inflation, lack of jobs, institutionalized corruption, etc.

This morning, Mubarek is teetering—even after agreeing to major concessions, including stepping down in September. There are open calls from Barack Obama and the European Union to “change now”, while the Egyptian military pleads with the protestors to calm down.

Then Jordan caught the bug: Following Tunisia, weeks of protests culminated in King Abdullah kicking his cabinet to the curb, and replacing his prime minister with Marouf al-Bakhit, a former Army general, as well as diplomat, who served as Jordan’s ambassador to Israel.

This change was a surprise. As the New York Times reports,

Changing cabinets is not new for King Abdullah. In his 12 years on the throne, he has done so eight times. But this was the first time that he had done so in reaction to public pressure, seeking to undermine a growing protest movement across a broad spectrum of society and to pre-empt further unrest. It came after four weeks of unusual public demonstrations.

Yemen too caught the Flu: Yemeni President Ali Abdullah Saleh—in power since 1978—has announced today he will not seek “reelection” in 2013 (a sham election, as he has always won since taking power). This concession hasn’t been enough for protestors, who are planning a major protest for today.

Tunisia, Egypt, Jordan, Yemen: All of these protests have the same basic shape—autocratic regimes ensconced in power through a combination of crony corruption, American financial and military aid, and intimidation and mild-to-medium repression, leads to public dissatisfaction which starts with the poor, but quickly rises through the professional middle classes.

The autocratic leader finds himself without support, even among the beneficiaries of his cronyism: The bureaucrats, cronies and the military that supported the autocrat are quick to distance themselves so as not to be identified with him.

Thus without visible support—and crucially an unwillingness of the military to decisively quell the street protests—the regime quickly begins to teeter. And as in the case of Tunisia, fall.

So far, of the ones hit—Tunisia, Egypt, Jordan, Yemen—none have any oil except for Yemen (though Yemeni reserves are expected to be depleted by 2017).

The issue is of course, What happens when a major oil producing nation gets hit with the Middle Eastern Flu?

Notice it’s when—not if.

Washington’s and Jerusalem’s wishes to the contrary, Iran might not necessarily be the next country to face severe internal problems: The next one might well be Saudi Arabia.

Consider: Officially, Saudi Arabia has a population of about 26 million—of which 5.6 million are foreign nationals, mostly South Asians (Indians, Pakistanis, Bangladeshi); over 20% of the population. Some observers think the proportion is much higher, closer to 30%—be that as it may, this large foreign population is an underclass that could easily revolt, especially if Saudi authorities preemptively try placing more controls on them.

Like the other aforementioned regimes, the vast majority of Saudis do not enjoy the lavish lifestyles of the ruling class, for the simple reason that there are too many people to benefit from the oil largesse. In Kuwait, the native population of Kuwaitis is small enough that they all do benefit from the oil largesse. But in Saudi Arabia, that is not the case—there is a large underclass in the country that has been paid off by the ruling royal family, including by way of education, subsidies and the like. But in terms of rights, they are no better off than the non-national population.

So potentially, the non-national population (many of whom, such as the 300,000 displaced Palestinians, were born there and have lived there all their lives) could begin protesting, sparking the alientated Saudi underclasses and middle classes to join in, creating a similar situation as the ones besetting Egypt, Jordan and Yemen.

The Saudi government does not need its people to rule—it needs American muscle, bought and paid for with Saudi oil. It could potentially repress—violently—any popular protest, if one were to arise.

But even if quelled, any protest in Saudi Arabia—or Iran—could severely disrupt the flow of oil to the rest of the world. And this could have drastic consequences for the world markets—a potentially catastrophic effect on the rest of the world, much like the ‘79 Oil Crisis did: Oil price spike, inflation, stagflation.

Something to consider, as we watch the Middle Eastern Flu unfold.