The True Dangers of Trump’s Economic Plans
His Radical Agenda Would Wreak Havoc on American Businesses, Workers, and Consumers
For Saudi Crown Prince Mohammed bin Salman, the war in Gaza has created a predicament. Gaza is ruled by Hamas, an Islamist movement that is allied and closely coordinating with Iran and its proxies, who wish to see the destruction of the House of Saud. But given how popular the Palestinian cause is with Saudi citizens, MBS must side with the Palestinians, who are seen throughout the Arab and Muslim worlds as the victims of Israeli aggression and occupation. The Saudi government wants to bolster its security, and it hopes that by normalizing relations with Israel, it can establish a security alliance with the United States and Washington’s regional allies. But Riyadh will not forge such ties when Israel is bombing Gazan civilians and refusing to recognize the Palestinians’ right to their own state.
Yet normalization was not, and is not, the only way for the Saud family dynasty to strengthen its hand. The regime can also protect itself and its interests by building a more powerful economy and shifting the country’s domestic ideology. To that end, it is actively developing new non-oil-related sectors, such as tourism, mining, logistics, manufacturing, technology, finance, and transportation. It is also shifting its source of legitimacy, which has long rested on the monarchy’s relationship to a fundamentalist interpretation of Islam, commonly known as Wahhabism, and on its role as the custodian of Islam’s most holy sites. Increasingly, the monarchy is instead seeking to legitimize its rule by presenting itself as protector of the Saudi people and promoting a strong sense of nationalism that places Saudi interests first. The resulting changes encompass virtually every aspect of the country’s society, from the legal and educational systems to the roles of religious authorities and women. Instead of committing itself to the spread of “true Islam,” the monarchy’s legitimacy rests on its ability to bring unity, peace, and prosperity to its region.
The war in Gaza has complicated this shift. Saudi Arabia still aims to normalize ties with Israel, but the kingdom is demanding a much higher price for diplomatic relations. The Saudis now insist that the Israelis offer guaranteed concessions that will lead to the creation of a viable Palestinian state. They are also trying to convince Washington to formally recognize the still intangible state of Palestine while calling on the UN Security Council to do so, as well. But the Saudis’ motivation for persuading Israel and the United States is not just to alleviate Palestinian suffering. It is also to make it harder for Saudi Arabia’s rivals—Iran and its so-called axis of resistance—to exploit that suffering as an excuse to foment chaos and instability. Riyadh believes that if the Israeli-Palestinian conflict is justly resolved, Tehran will be weakened, and the Middle East will settle down. The kingdom could then accomplish its national transformation and fulfill its vision of creating an interconnected and prosperous region, with itself at the center.
MBS’s objective is to make Saudi Arabia, as he puts it, “normal.” By this, he means a socially open and an economically dynamic society, although one that would remain firmly in his authoritarian grip. People would be free to remain pious, but they could not impose their orthodoxy on others. The government would not interfere in the daily habits of its subjects. Men and women could dress as they please in public and mingle without being harassed. The crown prince believes that this relaxation of religious and social norms would allow the country to compete economically with other nations, attract foreign investment and talent, and ultimately diminish its dependence on revenues from fossil fuels.
To help promote this vision of a more tolerant, modern country driven by a strong sense of nationhood, MBS has unveiled a raft of new initiatives. His government, for example, has created nonreligious holidays, such as Founding Day, that are now widely celebrated and promoted. Under the aegis of a program called Vision 2030, the regime has emphasized the country’s pre-Islamic cultural heritage, its natural beauty, and contemporary Saudi arts and culture. It has, for example, highlighted Al-Ula—a stunning Saudi oasis and desert region with spectacular ancient tombs. And the state is rewriting Saudi history in a way that underscores different sources of authority and legitimacy. The country’s school curricula and general historical works are being revised to place more emphasis on Arabian culture and the decisive role the royal family played in unifying and pacifying the region beginning in the eighteenth century. In this retelling, less attention is given to the role of religious revivalism in the country’s formation and history.
Riyadh is also deliberately rejecting transnational ideological claims and commitments. Unlike Iran, Saudi Arabia is no longer interested in defending pan-Islamic causes, nor does it subscribe to grand narratives about the injustices the West has inflicted on the so-called global South. Riyadh makes no mention of “the Great Satan” or “the forces of arrogance” or “the oppressed of the earth” or the need for “resistance,” as Iran and its affiliates do. The country places a high premium on its own sovereignty and on that of other countries, so it does not condemn the plight of the Uyghurs (a mostly Muslim minority group) under the Chinese Communist Party or that of Indian Muslims under the ruling Hindu nationalist Bharatiya Janata Party. And when Riyadh invokes the question of Palestine, it is as a nationalist cause, not an Islamic one.
The Saudis hope Washington becomes more involved in their region.
The Saudi leadership sees ideologies and movements that encourage transnational meddling as dangerous. It has, accordingly, banned many of them—including the Muslim Brotherhood. Instead, Riyadh’s vision of the global order is technophilic and neoliberal, even if the government has deployed state capitalism to develop new economic sectors and reshape existing ones. Saudi Arabia wants to move beyond its rentier welfare state, which, as of 2017, employed two-thirds of the country’s workforce.
These changes mean that Saudi Arabia now promotes the opposite of what Islamist regimes enforce. Take, for example, Soundstorm 2023, a music festival held in Riyadh in December. Hundreds of thousands of young people from all strata of society attended the event to listen to Calvin Harris, Travis Scott, Metallica, and a variety of other famous musicians. Almost no one was dressed in traditional Saudi fashion, and some outward markers of what would elsewhere be described as queer or alternative lifestyles were on full display. When video clips from the event went viral, Islamist groups responded with harsh criticism; the Houthis, for instance, condemned the Saudi authorities for allowing “debauched behavior” at a time when Palestinians were under attack. But the Saudi government ignored the criticism and went on with the entertainment, arguing that such events are crucial for the country’s transformation. They want their citizens to spend locally on domestic entertainment, which has historically been unavailable. Instead, Saudis have traveled abroad for such experiences, spending billions of dollars every year in other states. The government views such entertainment as central to developing the local economy.
MBS’s initiatives could help bolster Saudi Arabia’s prosperity and, relatedly, his regime’s popularity. Yet for them to succeed, peace must prevail. MBS came to this realization after several years of pursuing aggressive foreign policies, such as his costly intervention in the war in Yemen, a boycott of Qatar, and a hostile posture toward Iran—including his comparison of Iranian Supreme Leader Ali Khamenei to Hitler. These actions produced instability for the kingdom and jeopardized MBS’s goals. In September 2019, for instance, Iran launched cruise missiles and drones against Saudi Arabia’s oil installations in Abqaiq and Khurays, interrupting half the country’s oil production for several weeks. In March 2022, the Houthis targeted an oil depot at Jeddah airport, nearly preventing the Formula 1 Grand Prix race that Saudi Arabia had worked hard to bring to its territory. All the while, Islamist leaders throughout the Muslim world have vilified Riyadh as a U.S. lackey and an apostate regime.
As a result, the kingdom has adjusted its posture. Now, the official Saudi response to these taunts is muted, and its policy toward its rivals is conciliatory. Riyadh ended the blockade of Qatar in January 2021 and began negotiating a series of truces and prisoner exchanges with the Houthis in mid-2022. In March 2023, it signed a détente agreement with Iran that resumed diplomatic relations between the two countries. In December 2023, the Saudis have endorsed a road-map peace agreement to end the war in Yemen, and they are negotiating directly with the Houthis. In doing so, Riyadh has effectively acknowledged the Houthis as principal players in Yemen’s political future. The deal even suggests the Saudis will provide the group with financial aid and salary payments.
But the Saudis are not playing nice just because of regional pressure. The threats from Iran and its proxies come at a time when the United States has wavered about protecting Saudi Arabia from external aggression. Former (and perhaps future) U.S. President Donald Trump refused to respond to the 2019 attack on Saudi Aramco’s facilities, and his highly transactional style rattled MBS, who wants his country to be considered a strategic ally and not a gas station with an ATM. When U.S. President Joe Biden came into office in January 2021, he openly declared that he would punish Saudi Arabia for its involvement in the war in Yemen and its human rights record. Within a month, Biden released a CIA document that claimed MBS “approved an operation in Istanbul, Turkey to capture or kill Saudi journalist [and dissident] Jamal Khashoggi.” That same month, Biden removed the Houthis from the U.S. list of officially designated terrorists. And in 2022, the U.S. Congress blocked the transfer of arms for which the Saudis had already paid. All these decisions helped push MBS to adopt his new approach in the region, as well as to build stronger ties with China, India, and Russia. Together, they constitute his Saudi-first policy, in which MBS considers all kinds of options to secure his dynasty’s rule.
The hedging helps explain why Saudi Arabia has refused to join the U.S.-led maritime coalition to stop Houthi attacks on Red Sea shipping. The Saudis expect that their economic interests, over time, will outweigh more militant ideological commitments. Riyadh is therefore eager to build financial and investment ties with Iran and with the Houthis, hoping that such vested interests may eventually shield the kingdom from their aggressive acts.
But MBS is not naive about his enemies’ will to harm his country, nor is he naive about their capabilities. Iran and its allies will never be Saudi Arabia’s friends, and Israel and the United States are militarily too powerful to be completely defeated. Saudi Arabia has, after all, seen the axis of resistance’s vainglorious and quixotic movie before. Egypt’s Gamal Abdel Nasser attempted to spread pan-Arab revolutionary ideology, as did Iraq’s Saddam Hussein through his Baathist political movement and military aggression. The results were catastrophic. There is no military solution that can bring about a Palestinian state, and there is no way to force the United States out of the Middle East.
In fact, the Saudis hope Washington becomes more involved in the region. The crown prince’s drive to normalize relations with Israel was, in part, a means of getting a broader security agreement with the United States. In exchange for a Saudi embassy in Israel, the kingdom wanted a mutual defense treaty with Washington that would protect Saudi Arabia from external attack and grant it a U.S.-managed nuclear program. The kingdom would then finally become a strategic ally of the United States, with status comparable to that of Japan or South Korea. This would be a major accomplishment for Riyadh and a feather in MBS’s cap. It would be an even greater feat than the establishment of the relationship between the kingdom’s founder, Ibn Saud, and U.S. President Franklin Roosevelt in 1945—which ushered in decades of cooperation between the two countries and spectacular economic progress.
For now, however, any possibility of normalization with Israel is on long-term hold, given the devastation in Gaza. The Palestinian cause, which was sidelined after the 2011 Arab Spring revolts, is again central to the politics of the Middle East, thanks to Hamas’s attacks on October 7. The Saudis hold the Palestinian leadership in low regard but feel compelled to join the rest of the Arab world in condemning Israel. The Saudi foreign minister and other princes issued statements decrying Israel’s actions as war crimes. They have called for an immediate cease-fire. And in late January, the Saudi government endorsed South Africa’s accusation before the International Court of Justice that Israel was committing genocide in Gaza.
But these statements were milder than the criticism from other regional countries, and the Saudis hope to restart their normalization drive soon. They do, however, now expect serious concessions from the Israelis—ones that will result in the creation of a viable Palestinian state. Anything less will lead to the accusation of treason against MBS, who is particularly sensitive about allegations of betrayal given his status as the most important Arab leader and the guardian of Islam’s holiest sites. That means the deal The Huffington Post reported that Israelis have offered the Saudis, pushed and mediated by the United States, will not be enough. This agreement would involve normalization in return for certain guarantees for the Palestinians, but it does not appear to create concrete steps toward statehood. Short of such a pathway, the Saudis are not going to sign on. They have made it clear that they will not be cleaning up the mess the day after the war ends.
Whether meaningful steps are possible given Israel’s hardened politics and Israeli Prime Minister Benjamin Netanyahu’s own political ambitions is anyone’s guess. But Hamas’s attack has made the Palestinian cause an important element in how Riyadh now thinks about its national interest. It has, therefore, made Saudi Arabia reengage as a staunch supporter of Palestinian statehood. In this respect, Hamas has secured a victory for the Palestinians—although perhaps not for itself.