Posted by: Snake Oil Baron | April 11, 2009

Mirage of the Jinn

Recessions (and depressions) are double natured beasts. They cause people to lose jobs, houses, hope and for some people, their lives. So it seems perverse and insensitive to say that they can be beneficial in any way. So allow me to be perverse and insensitive for a while. The greatest benefit of recessions is that they expose fakes and phonies and highlight flaws in even relatively strong economies. Pseudo-democracies like Venezuela and Russia and seemingly strong and impressive (to some) totalitarian and theocratic states like Iran, which used oil revenue to conceal how corrupt and inefficient their economies are, find that the bar lights have come back to bright at closing time and everyone’s beer goggles are slipping off. In bad times, well run economies suffer, mediocre ones face tough choices, incompetent ones fail – sometimes to be replaced by a better system.

My beer goggles just fell into my drink while sitting across the table from Dubai. I had read so many experts pontificate that Dubai was something special. The ruler was wise enough to realize that the oil would not last and was investing heavily in tourism, and the finance industries. It was comparatively liberal society and a model to be emulated by other Islamic nations. The Discovery Channel’s specials on its mega engineering projects and the news articles showing a skyscraper forest erupting out of the desert in a matter of years were all very astonishing.  A thin sack of truth can hide a huge volume of horse sh!t.

I was searching for demographic information when I happened upon a website called St. Francis Magazine which is about native Christians and Christian mission work in Arab lands. It was not really what I was looking for but I noticed a link for the editor’s blog which contains some interesting posts containing news links about various religious and societal issues in Arab lands. This lead me to an article in The Independent which really dispels a lot of illusions about Dubai. More importantly, it casts the future of the city into doubt. Chickens are coming home to roost and they are angry, angry chickens.

The enlightened rule is a sham. The bigwig’s one good idea of planing for the end of the oil wealth is buried by the traditional authoritarianism whose effects are partially hidden by the oil wealth and partially by the West’s in attention. The Islamic liberalism is a fraud based on segregation and obliviousness. The economy is an illusion, created by slave labour and funded by oil wealth. Without a lot of change to almost every aspect of this society, and soon, it will closing time and the bright lights will be coming on for the whole world.

Are all the economies in the Middle East and North Africa illusions, cast by evil jinn of these governments to deceive the economists and investors of the West and Asia? Maybe, but it could be that some of them have done enough investment in infrastructure and education and diversification that there will be some substance behind the phantasm. That’s where the recession comes in. Lets see what happens when these societies have been tested by the crisis.

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