Skip to main content

The real reason the knives are out for Mohammed bin Salman

In the six weeks before Khashoggi’s disappearance, MBS not only managed to anger the U.S. military-industrial complex but the world’s most powerful bankers.

by Whitney Webb

Part 3 - MBS – the “reformer” who wasn’t

Though the media has long spun Vision 2030 as MBS’ “ambitious” plan to wean the Saudi economy off its dependency on oil, the plan itself is actually a free-for-all for private interests and involves the neoliberalization of Saudi state-owned assets. Among its pillars are the opening of Saudi financial markets to Wall Street and the privatization of essentially everything in the Gulf Kingdom, including healthcare and, of course, Aramco.

The fact that Vision 2030 was essentially a neoliberal wish-list should not come as a big surprise, however, given that it was based off a 2015 report authored by the McKinsey Global Institute, the research arm of the U.S.-based consulting firm McKinsey & Company — the “most prestigious” consulting firm in the world, known for its “neoliberal solutions to real-world problems”.

According to a report published last year in Foreign Policy, “McKinsey has cultivated a generation of young Arab princelings enamored with Western-style economic reforms, and with thoroughly mixed results.” However, this was especially true of Saudi Arabia, where MBS cultivated even closer ties with the firm and has relied on it, not just for the blueprint of Vision 2030 but also for choosing his new cabinet following his rise to the position of Crown Prince as well as a list of prominent Saudi dissidents who were later repressed.

In addition, McKinsey’s influence goes far beyond the firm itself, as its past employees or “alumni” go on to serve powerful positions in the corporate world or in government. Though the extent of McKinsey’s influence in helping MBS rise to become crown prince is unknown, it is certainly a possibility that the firm had used its influence to “grease the wheels” in order to give near-ultimate authority to one of these “young Arab princelings,” who would embrace neoliberal reforms that older generations would not.

Vision 2030 certainly seemed to win MBS the affection of the international elite across the board — and it seemed that the new Crown Prince enjoyed the limelight, at least for a while. However, it seems reality began to set in for MBS, and he has consequently spent the past several months looking for a way to indefinitely delay the plan’s implementation.

This first became clear earlier this year following speculation in July that the Saudi Aramco Initial Public Offering (IPO) — i.e., the beginning of the partial privatization of the Saudi state oil company through the selling of shares — may not materialize after all. Then, it was announced in late August that the entire IPO would be shelved. Bloomberg called this “the most significant reversal in Prince Mohammed’s plans” and added: “Rather than marking a watershed in one of the most ambitious economic projects in history, it [the shelving of the Aramco IPO] now highlights the unpredictability of the country under a young leader who has centralized political power in his own hands since becoming de facto ruler a little over a year ago.

As a result, what would have been the biggest IPO in history was called off overnight. The move was surely a disappointment to Trump, who had personally lobbied MBS to list Aramco on the New York Stock Exchange (NYSE), as doing so would have awarded the NYSE with the largest stock market listing ever. However, it was a much, much bigger disappointment for the behemoth financial institutions that had worked frantically to secure their roles in the deal — Bank of America, Goldman Sachs, and CitiGroup, among others — as the shelving of the IPO meant that all their work on the deal would now go without compensation, as banks are typically only paid when such deals are finalized. In other words, MBS’ decision to put the IPO indefinitely on hold meant that the most powerful, politically-connected banks had essentially been forced to work for free.

It seems that MBS sensed the animosity he had caused in some of the world’s most powerful financial institutions, given that, just a few weeks later, he offered Goldman Sachs, Bank of America and CitiGroup a prominent role in Aramco’s new plans to buy a majority stake in the Saudi petrochemical company Saudi Basic Industries Corp (Sabic). As part of that deal, Aramco has considered selling bonds in what could become the largest sale of corporate debt ever. However that Aramco-Sabic deal, valued at $70 billion, is still significantly less than the $100 billion that the Aramco IPO was set to generate.

More importantly, the deal shows that MBS got cold feet in his privatization plans, as having a state-owned company (Aramco) buy a majority stake in a private Saudi company (Sabic) is the complete opposite of what MBS had promised in the months prior to his rise to become Saudi crown prince. Indeed, as Bloomberg noted at the time: “The [Aramco] bond sale would give Saudi Arabia some of the financial payoff of an IPO, though without having to share ownership with international investors — or revealing information the kingdom would rather keep private.

Thus, it seems that it was the privatization of Aramco that had MBS spooked.

Far beyond the cancellation of the IPO itself — MBS has endangered other parts of the plan that these powerful financial interests had been counting on for well over a year. That includes Vision 2030’s plan to increase the Saudi Public Investment Fund (PIF) — which is managed by a group of HSBC and Bank of America directors and a CitiGroup investment banking alumnus — from its current $230 billion in assets to a massive $2 trillion. The dramatic increase in the fund’s size would make the PIF the largest sovereign wealth fund in the world. Without that injection of cash into the PIF from the Aramco IPO, media reports have warned of a “ripple effect” on the U.S. economy, including massive U.S. tech companies like Uber, given that the PIF has invested heavily in such companies.

Evidence has since emerged that MBS knows that these powerful banks are still angry despite his efforts to placate them. On October 5, just a few days after Khashoggi’s murder, MBS promised a new Aramco IPO within a few years, this time valued at $2 trillion. However, media reports on that announcement made it clear that Goldman Sachs, CitiGroup and the like weren’t convinced.

Indeed, with the entire privatization effort now in doubt, so too is the estimated $6 trillion in direct investments from powerful interests that had been planned to fund the privatization schemes that comprise the entirety of Vision 2030. That figure could certainly explain why so much pressure has been levied against MBS as of late over Khashoggi. Indeed, given that the Saudis had butchered another dissident writer in 1979 in their Lebanese consulate without the same outrage that has resulted from Khashoggi’s murder, it is safe to say that the establishment’s outrage over this latest extrajudicial killing is motivated less by “human rights” than by trillions of dollars of capital.

Source, links:


[1] [2] [4] [5]

Comments

Popular posts from this blog

Manufacturing uncritical thinking

by system failure
I was thinking about writing something related to a certain behavioural pattern that we often meet in the mainstream media journalist army. I was inspired by the impressively loud example of The New York Times' Bari Weiss, and how it was presented by Jimmy Dore in his show.


During this particular discussion with Joe Rogan, Weiss rushed to paint US presidential candidate, Tulsi Gabbard, as an "Assad toady", without even knowing what the characterization means. As Dore aptly pointed out: "That's what's called a 'received opinion'. So, it's not her own opinion. She has heard other people in her neoliberal bubble say that stuff, so she just repeats it. She doesn't even know what the insult means."
Ben Norton wrote on Twitter: "Neocon NY Times columnist Bari Weiss smeared Tulsi Gabbard (who bravely opposed regime change and US support for Salafi-jihadist contras) as an "Assad toady," then couldn't spell/de…

Greece is about to become the blueprint for modern feudalism

globinfo freexchange
After almost ten years of an unprecedented crisis, Greece has been trapped into an ongoing, slow motion recession. The economy still struggling hard to recover, with unemployment and national debt being permanently in a red alarm mode.
As has been already pointed out, the result of the recent Greek national elections could be characterized "paradoxical" mainly for two reasons: 
First, the voters gave a clear governmental order to one of the traditional powers of the old political system, which are highly responsible for the Greek crisis that erupted in 2010. Several top names of the new government, and even New Democracy leader, Kyriakos Mitsotakis, have been accused of being involved in various corruption scandals, in the not so distant past.

Second, the fact that the voters elected perhaps the most fanatically neoliberal government ever. This means that Mitsotakis administration is expected to implement the brutal neoliberal policies imposed by Greece&…

How Joe Biden’s privatization plans helped doom Latin America and fuel the migration crisis

On the campaign trail, Joe Biden has boasted of his role in transforming Colombia and Central America through ambitious economic and security programs. Colombians and Hondurans tell The Grayzone about the damage his plans did to their societies.
by Max Blumenthal
Part 8 - Gutting public healthcare, driving more migration
The Alliance for Prosperity also commissioned the privatization of health services through a deceptively named program called the Social Protection Framework Law, or la Ley Marco de Protección Social.

Promoted by Honduran President Juan Orlando Hernández as a needed reform, the scheme was advanced through a classic shock doctrine-style episode: In 2015, close associates of Hernández siphoned some $300 million from the Honduran Institute for Social Services (IHSS) into private businesses, starving hospitals of supplies and causing several thousand excess deaths, mostly among the poor.
With the medical sector in shambles, Hondurans were then forced to seek healthcare from …

As Boris Johnson unleashes ultimate threat against Bremain capitalist faction, the British working class is suddenly in front of a unique opportunity

globinfo freexchange

In the merciless endo-capitalist war around Brexit, Boris Johnson decided to unleash the ultimate threat against Bremain capitalist faction. That is, a snap election with the 'danger' of a Labour victory under Jeremy Corbyn, which would be neoliberal capitalists' worst nightmare.
As already pointed out, despite the capitalist civil war, both major factions of the British capital remain deeply neoliberal in their ideological core. And therefore, both factions see a potential Labour government under Jeremy Corbyn, as a major threat.
Indeed, as ZeroHedgereported
As Prime Minister Boris Johnson faces the prospect of his rule being cut short, wealthy Britons have a message for Johnson's most likely successor: A 'no deal' Brexit makes no difference to them. But if Labour leader Jeremy Corbyn becomes PM, they will flee in droves, taking their money with them

[...]

The chairman of one Swiss asset manager who helps wealthy Britons shield th…

Tucker Carlson accidentally promotes one of the most anti-capitalist, real-Left positions!

globinfo freexchange 
We wouldn't believe it if we wouldn't have seen it and hear it with our own eyes and ears, but the following phrase came out from Tucker Carlson's mouth:

                    Every minute you are angry about race, is a minute you are not thinking about class, which, of course, is the real divide in this country. Working class people of all colors have a lot more in common - infinitely more in common with each other, than they do with some overpaid MSNBC anchor. And if you are allowed to think about that for long enough, you might start get unauthorized ideas about economics. And that would be disruptive to a very lucrative status quo. So, they whip you into a frenzy of racial fear so that it never enters your mind. It's a diversion. Everyone hates each other, they get to keep their money.
Here's why they're pushing racial division: so you won't notice the real divide, which is economic. pic.twitter.com/ZVLvQn2u9O — Tucker Carlson (@Tuck…

Bernie finally declares war on neoliberal fascists who destroy the planet

globinfo freexchange
Bernie Sanders proved again why he should be the next president of the United States. This time, he declared war on the neoliberal fascists who are destroying the planet on behalf of the corporate beasts.
Bernie tweeted:
                    Climate change is a global emergency. Bolsonaro and his corporate cronies are burning the Amazon rainforest for personal profit and jeopardizing our planet's survival. My Green New Deal will impose climate sanctions against corporations that threaten our global climate goals.
Climate change is a global emergency. Bolsonaro and his corporate cronies are burning the Amazon rainforest for personal profit and jeopardizing our planet's survival.

My #GreenNewDeal will impose climate sanctions against corporations that threaten our global climate goals. https://t.co/erZzHozviQ — Bernie Sanders (@BernieSanders) August 22, 2019
Recall that the previous right-wing corporate puppet in Brazil, Michel Temer, opened the door to t…

Roger Waters for Julian Assange

globinfo freexchange
On Monday, 3 Sept, Roger Waters of Pink Floyd will perform his classic 'Wish You Here' for Julian Assange outside the Home Office (interior ministry) in Marsham Street in the heart of London. John Pilger will be speaking. Join us at 6pm in solidarity with Britain's political prisoner.

On Monday, 3 Sept, Roger Waters of Pink Floyd will perform his classic 'Wish You Here' for Julian #Assange outside the Home Office (interior ministry) in Marsham Street in the heart of London. I will be speaking. Join us at 6pm in solidarity with Britain's political prisoner. pic.twitter.com/Lytg2GCZVQ — John Pilger (@johnpilger) August 30, 2019


Καταιγίδα επιχειρήσεων αποπροσανατολισμού από το Μητσοτακικό καθεστώς με τη βοήθεια της τραπεζομιντιακής χούντας

globinfo freexchange

Ο μηχανισμός του εγχώριου νεοφιλελεύθερου καθεστώτος επιδόθηκε τις τελευταίες μέρες σε έναν καταιγισμό επιχειρήσεων αποπροσανατολισμού προς τέρψιν του πόπολου, το οποίο έδωσε αυτοδυναμία στην πολιτική του συνιστώσα. Δηλαδή, στη χειρότερη δεξιά της μεταπολίτευσης.
Μετά το ταξίδι Μητσοτάκη στη Γαλλία, όπου είδαμε ένα χιλιοπαιγμένο έργο, το σόου του αποπροσανατολισμού ξεκίνησε από το Μάτι. Εκεί είχαμε ένα διπλό χτύπημα. Από τη μια τον Μητσοτάκη να ποζάρει στα καμμένα, διατυμπανίζοντας τη δήθεν αποτελεσματική του κυβέρνηση. Από την άλλη, την διαφήμιση των "καλών ιδιωτών", οι οποίοι ως καλοί Σαμαρείτες, ανέλαβαν δήθεν αφιλοκερδώς (Αφιλοκερδώς ΑΕ, όπως έλεγε και ο αξέχαστος Τζιμάκος), να καθαρίσουν την περιοχή από την επικίνδυνη καύσιμη ύλη.
Αμέσως μετά, απολαύσαμε άλλη μια κωμωδία από τις δυνάμεις καταστολής που έκαναν έφοδο στα Εξάρχεια για να τα "καθαρίσουν" από τους μετανάστες. Οι νεοφιλέλεδες της δεξιάς και τα ακροδεξιά δεκανίκια τους είναι μανο…

Citibank blocks funds for insulin: more than 450,000 Venezuelans affected

The US bank Citibank blocked, in August this year, part of the funds destined to import 300 thousand doses of insulin, a criminal act that affects more than 450 thousand patients, the Venezuelan Ministry of Economy and Finance reported.

On the other hand, the BSN Medical laboratory, based in Colombia, after receiving payment for the purchase of 2 million units of antimalarial treatment, denied the clearance of the drugs.
The ministry indicated that this fact caused the Swiss bank UBS AG to block the transactions made by the country with the Pan American Health Organization (PAHO), destined for the purchase of vaccines for the immunization program.
Given this circumstance, Venezuela and PAHO sought alternatives with banks from other countries, although this situation led to a 4 month delay in the immunization program.

The national government also revealed that other pharmaceutical transnationals such as Pfizer and Novartis refuse to sell medicines, reagents and supplies to Venezuela.
F…

The untold Socialist history of the United States

globinfo freexchange

Abby Martin spoke with renowned Marxist Economist Richard Wolff to discuss the growing popularity of Socialism under Trump and its historical roots in America, misconceptions about Russia and China’s economic success and Marx’s theory of alienation and monopoly capitalism.

Wolff explains:

A hundred years ago, 1916 to be precise, was the first time that the Socialist Party of America put forward a candidate for president. His name was Allan Benson and he ran for president a hundred years ago and he got 600,000 votes in the United States. That worked out to three percent of the vote.
The Socialist Party thought that was a good beginning, so they ran again four years later, in 1920, little less than a hundred years ago, and they had a different candidate. A man named Eugene Victor Debs, a head of the railway Workers Union, very good orator. And he did better. He got 900,000 votes. That's a 50% increase in four years, four percent of the total vote.
Four yea…