The Saudi Purge Isn’t Just a Power Grab

 In U.S.
It makes sense to be cynical about Crown Prince Mohammed bin Salman’s ostensible crackdown on corruption in Saudi Arabia. Among the 11 princes, 4 ministers, and dozens of well-known businessmen arrested were some of the 32-year-old’s last potential rivals to the Saudi throne. The move also smacks of an asset snatch. Police nabbed 3 of the Arab world’s 10 richest men, including investor Prince Alwaleed bin Talal, the billionaire best known for rescuing Citicorp in 1991 and making big bets on Apple Inc. and 21st Century Fox Inc. But was it only a Machiavellian power play? Or is this the start of a dramatic, go-for-broke attempt to transform a country that’s resisted change for decades?

Prince Mohammed seems to be playing the equally ruthless roles of autocrat and reformer. The millennial has been outspoken about his bold plans to modernize Saudi society and wean the kingdom from fossil fuel. Now, Prince Mohammed has locked up globe-trotting tycoons and other dynastic rivals, sending shock waves across the desert and around the world. Since Saudi Arabia’s founding in 1932 by his grandfather, Abdulaziz Al Saud, successive kings have sought consensus among the family’s thousands of princes, balancing religious, princely, and tribal factions to maintain stability in the world’s largest oil supplier. Decisions were made at a glacial pace, often capped with generous payouts for anyone left unhappy. Prince Mohammed has smashed that conservative status quo in an act, he no doubt believes, of creative destruction.

This is a man of dead-certain belief in himself, who told this magazine in a long, autobiographical interview in April 2016 that his childhood experiences among princes and potentates were more valuable and formative than Steve Jobs’s, Mark Zuckerberg’s, and Bill Gates’s. So, he wondered aloud, “if I work according to their methods, what will I create?” Now we know his disruptive potential.

The prince’s unprecedented arrest of a who’s who of Saudi society is a first stab at fulfilling his vow to hold the corrupt accountable. “I confirm to you, no one will survive in a corruption case—whoever he is, even if he’s a prince or a minister,” Prince Mohammed said in a televised interview in May. The vow has now become a Twitter sensation among Saudis under the age of 30, who make up 70 percent of the population, the demographic bulge the prince has made his base. They’re still plenty skeptical of Prince Mohammed and his father the king, who recently visited Moscow with 1,500 retainers, his own carpets, and a golden escalator for his Boeing 747.

Featured in Bloomberg Businessweek, Nov. 13, 2017. Subscribe now.

Photographer: Metzel Mikhail/TASS/ZUMA Press

No one imagined the crown prince would go so far. The takedown, set up by his father, King Salman, through a new anticorruption commission that Prince Mohammed chairs, rounded up his most visible potential adversary, Prince Miteb bin Abdullah. A favored son of the late King Abdullah, who died in 2015, Miteb, 65, commanded the Saudi National Guard, which, until his arrest, had been the last military branch not under Prince Mohammed’s control.

Other detainees included princes and ministers who have been linked to questionable, if not corrupt, transactions. Prince Turki bin Nasser, for example, is infamous for his involvement in the so-called Al Yamamah arms deal between Britain and Saudi Arabia, a massive sale that led to corruption probes in the U.K. and the U.S. Adel Fakeih, a top economic policymaker before his Nov. 4 arrest, was mayor of Jeddah during a flood in 2009 during which scores of people died because of the failure of infrastructure, apparently shoddily made. Dozens of people were convicted of criminal charges including bribery, but not Fakeih, who was never charged and went on to serve as a minister in Riyadh for an additional half-dozen years.

Ever since the floods, Abdullah Jaber, a popular Saudi cartoonist, has drawn caricatures of Fakeih, without naming him, to symbolize the toll of corruption on Saudi Arabia. He couldn’t believe his eyes when he read Fakeih had been arrested and that the Jeddah flood case had been reopened. “I still can’t absorb the greatness of what has happened,” Jaber said in a Twitter post.

In total, the government froze bank accounts of the more than three dozen men detained, putting about $33 billion of personal wealth at risk. Three of the detainees, Alwaleed among them, own three of the largest privately held television networks in the country. Saudi authorities also moved to freeze the private accounts of hundreds more suspected of corruption but not yet arrested. The crackdown is Prince Mohammed’s strongest blow yet at the rentier state, the system of gatekeepers, sinecures, and handouts that’s sapped the incentive in Saudi Arabia for entrepreneurship to flourish, the prince has said.

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