PREVIEW： Brokenomics ｜ The Constraints on War with Firas Modad
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Summary
In this episode of Brokonomics, I'm joined by our geopolitics expert Fares Moudad to talk about the impact of the Iran war on the wider region, including the impact on Qatar, Saudi Arabia, the UAE, and other Persian Gulf states.
Transcript
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Hello and welcome to Brokonomics. Now in this episode I thought I'd do something different
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because I've been talking about the Iran war a lot.
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So, first caveat, this is being recorded on whatever it is,
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So it's vaguely possible that over the weekend,
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um and and it's all behind us i feel fairly safe dedicating an hour of mine and yours time and a
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couple of hours of the editors or the assumption that it probably won't be yeah um there is some
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interesting news though apparently quitar have paid six billion in order to be able to traverse
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the straits i think that's credible but too low honestly yes i think well the other thing that
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gets me is it's just money. It's not, and we will remove US bases. Yes, exactly. The Qataris have
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been making noises about neutralizing themselves from this war, which presupposes the removal of
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the Odayd airbase. The problem with that is that's the only guarantee of Qatari independence.
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In 2017, the Saudis and the Emiratis almost invaded.
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And the reason that base exists is to prevent that eventuality.
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And in terms of the $6 billion, the Qataris reportedly, allegedly, paid a billion dollars in 2015 to a group of Iraqi militias who had kidnapped 28 Qatari princes.
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They were hunting in Iraq, and the Iraqi militias found them.
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And the Qataris say that they paid money to the Iraqi government.
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the militias say the money went to them. Nobody really knows, but opening the Strait of Hormuz
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is worth considerably more than six billion. Well, I would have thought it's worth more than
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six lots of 28 princes. I mean, is it not the case that if the Gulf states don't open the straits,
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not only does oil not go out, but food doesn't come in? Yes. So this is an existential crisis
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because he's all very well worrying about the Iranians.
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But worrying about a couple of million of your citizens
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is a whole other level of problems for the leadership of these countries.
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And the way that it's working is that the Iranians are charging fees
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And they're giving them safe passage through an alternative pathway
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suggesting that the main international waterway is mined.
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whereas other ships are paying up to $2 million per passage.
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meaning that the Chinese are exchanging favors with the Iranians
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and the Iranians would use that money to buy equipment from China
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which is already providing Iran with either them or the Russians
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but Iranian missiles have been plugged into Baidu
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which is upgrading itself to become equivalent to Starlink
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or the Chinese have other technologies that are trying to mimic Starlink
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and Starshield which is the military arm of Starlink
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that has the constant surveillance pretty much all over the globe.
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What I'm saying is that the Chinese are helping the Iranians
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with targeting and with intelligence collection
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Hmm. Frankly, I'm not surprised about the Russians because the Americans have been helping the Ukrainians are targeting, so why wouldn't they do that?
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So one of the things I think you said on our recent Real Politics, it was very interesting, was that the Gulf states quite deliberately maintain a sub-size military because they are afraid that if they had a large military, that could replace the leadership of these countries.
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So these countries are now in a very awkward position,
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but they need the Americans because that's their security guarantee.
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That's how they manage to be in the position where they can go on,
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28 of them at a time can go on a hunting trip in Iraq,
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and they have the resources to spend a billion to get them back
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and all the other luxuries that I'm sure these Gulf state leaders have.
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But if they're now paying tribute to the Iranians,
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that suggests to me that the Iranians are at least emerging
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as the regional hegemon? And how do they get their head around having two sets of patrons?
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That's the real problem that they've always faced. And the way that they've addressed it in the past
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was, for example, with the Qataris having decent relations with the Iranians and being mediators
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and all of that. The Omanis doing something similar. The UAE has always facilitated trade
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for Iran and help them evade sanctions because they know that when push comes to shove, the
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Iranians can start blowing up their ships, essentially, as they did in 2018. They attacked
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a bunch of ships off the coast of Oman, and then the UAE sends a maritime delegation to discuss
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shared security interests, meaning that they've accepted that, okay, we have to listen to you.
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And the Iranians now are no longer satisfied with letting these guys have this two-way relationship.
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But all of the military infrastructure in the Gulf is American.
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There are some Chinese assets here and there, like the Saudi ballistic missile program is largely Chinese and so on.
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and especially the air force it's either american or in the uae's case it's half french as well
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yes and the uae had and has a strong military relationship with the french as well okay but
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for a long time there was no alternative to the americans if you wanted to have
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a very high level very credible level of security for your nations chinese technology weapon systems
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tech, all the rest of it, financial resources, Russian military capability, it does start to
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look like there is an emerging alternative to the Americans. Which is why getting into this war was
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such a stupid idea. Because now... For the Americans. For the Americans. Yes. Because now,
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if this war ends on Saturday, as is being rumored.
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So what's the scenario in which it ends on Saturday?
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Whereby Trump decides, I've accomplished what I wanted to achieve,
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But that would leave Iran as the pretty much uncontested hegemon of the region.
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If Americans leave with the Straits under Iranian control,
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that's that that is about as dire as you can get for the petrodollar system
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and even in time the dollar reserve system yes essentially right so now that he's gotten himself
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into this war now that trump has gotten himself into this war getting out of it is so much harder
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so let's just carry on thinking through the gulf states
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how do they feel about that what what is their temperament likely to i mean first of all can we
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even assume that we can just say the gulf states no or does amman have radically different opinion
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on this to say saudi and qatar how do they work through this group um we're in a situation where
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we may be losing the us as a patron as a as the hegemon and we might get be getting it replaced
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with Iranian, which is essentially a proxy for Russia and China. So the problem that they face
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is that most of the purchases of Gulf oil go to Asia. Yes. With China being the largest buyer in
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Asia. So that's one massive problem that they have. The second problem that they have is that
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the Saudis have their own regional pretensions and regional ambitions,
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and don't want to be playing second fiddle to the Iranians. Is that credible, given the earlier
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point about them not having much in the way of the military because they've outsourced that?
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In terms of the air force, the Yemen war forced the Saudis to upgrade their air force.
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In terms of ground forces, they are quite weak, I would say, with a lot of American equipment,
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but a huge amount of incompetence. And you're not allowed to actually make decisions unless
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you're of the royal family. And so there is this integration between the royal family and the
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military which they've used to try to control the army but this hasn't in the past stopped other
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monarchies from being overthrown by lower lower levels of the military who have had enough
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essentially and so if these guys actually commit their military and depend on it the military
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becomes quite powerful yes and a country like saudi arabia which is named after the family
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The House of Saud, exactly, runs into big problems there.
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these are compromises between the ruling family
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If Saudi Arabia wakes up its potential because it's big and it's rich,
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if somehow it wakes up its potential, I don't know how it does that,
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Chinese tech, Russians come in and train an army of 4 million,
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do the rest of the Gulf states stay independent?
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Essentially, they get divided between Iran and Saudi Arabia.
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And a country like Kuwait, for example, ceases to exist.
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Because for the Iranians, the big security challenge
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and the flatlands that terminate near the Iranian-Iraqi border
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are also where the Iranian oil is concentrated.
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So that region from Kuwait to Basra to Khuzestan
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with a shared region between Saudi Arabia and Kuwait.
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And so for the Iranians, the security imperative is to seize all of this.
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But if they seize all of this, that gets them at the border of the eastern province,
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which is where the Saudi oil is, which is largely Shia.
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And that is right next to Bahrain, which is also largely Shia.
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And is it as simple as saying, if you're Shia, you're going to be far more sympathetic to Iran?
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It really, I mean, there are always exceptions to every rule, but the rule is the rule regardless of the exceptions.
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And so the emergence of Iran as a hegemon, it changes the political dynamics in the whole region because it means that at least two of these countries no longer need to exist in their current form, Kuwait and Bahrain.
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And that's a massive problem because the entirety of the American policy in the Gulf is predicated on keeping these small countries independent so that there isn't this massive concentration of oil wealth in one set of hands.
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and the importance of keeping Saudi Arabia on side for the Americans
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is to make sure that the biggest player in oil exports
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isn't beholden to powers that are hostile to the United States.
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Well, Saudi has always had a sort of special position.
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look, we give you security guarantees and we cooperate.
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well, we'll be nice to you or we'll invade you.
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and if they activate their air forces well their base defenses are weaker than those of the
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americans even though the bases are shared and as the interceptors run out you have that scenario of
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what you're seeing in ukraine which is sending big waves of drones to disable aircraft
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and if you're russia you want that because then this opic plus configuration which is opic including
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russia and others essentially is the energy hegemon of the world and is an energy hegemon
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that can challenge china as well as the west because you're not dealing with iranian oil
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anymore you're dealing with iranian iraqi and kuwaiti oil as one which is a game changer the
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kuwaitis i think produce around three or four million barrels a day uh the iraqi is three or
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four but with the potential for much more and the Iranians three and change so suddenly you have
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Saudi that is pumping around 9 million barrels a day in stable times with a total capacity of 12
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million suddenly you have another Iran and Russia aligned Saudi with its own 9 million barrels a day
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If you look at the actual size of the resources,
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the Iranians were producing 6 million barrels a day
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But the sanctions and the chaos and all of that
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of the americans to withdraw and now that they are in the war they have to stay in it
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well i mean this is the huge conundrum they cannot afford to have a bad outcome from this
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but getting a good outcome could involve a lot of american lives unfortunately indeed and so
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this is why every other american president resisted this war even though the israelis
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have been pressing for it forever even though the plan was okay we have Iran surrounded in
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Afghanistan and Iraq it's going to be next and then yes that's it so let's just finish off on
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the Gulf states because this is fascinating so worst case scenario is perhaps Iran getting Iraq
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and Kuwait Saudi could get the rest although it could start fragmenting as soon as it gets a large
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enough military to be able to to occupy its neighbors it could credibly fragment in some
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sort of way or collapse if the saudis get into the war the next thing that happens is that yemen
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gets into the war right like the the saudis won't be fighting iran or just iran they'll be fighting
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iran the iraqi militias and yemen meaning that they are facing a two-front war what's the shia
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sunni split in iraq i mean what what proportion of them 60 percent shia 20 percent kurds 20 percent
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suddenly okay so this comes down to see a shia versus sunny that's a real problem for that's a
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real problem because i think something like uh 40 of the iraqi population is under 14.
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so that's a massive youth bulge there what are you going to do with them well arm them
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buy them cheap chinese guns and throw them and you don't need to be a burnham level propagandist to
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get young men who don't have a lot to lose to fight. Exactly. So what about the smaller states
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then? Because they obviously sound like they're in an incredibly precarious position and trying
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to pick their way through this without upsetting, well, I don't know what their relations of the
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smaller states are with Saudi Arabia, but without upsetting the Americans or the Iranians too much
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while they figure out how this is going to land. Well, let's start with Oman. The only people with
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ambitions on Oman are the UAE. They want to take Oman, that is their hope, because that then
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transforms them from a minor country into a major one with enormous territory and with real
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strategic depth. Can we speak of the UAE as a unified thing? Yes, because Abu Dhabi is by far
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the largest and has the largest actual Emirati population and has the vast majority of the oil
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wealth and is in control of pretty much all of the federal institutions. I see, okay. And so
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more or less, yes, we can to a large extent. Even though the smaller ruling families aren't happy
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with the level of dominance that is exercised by the al-Nahiyan, the ruling family of Abu Dhabi,
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It's like medieval France. Paris is dominant, and then you've got the regional counts and lords.
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Yes, exactly. For the UAE, they are the ones that are most decidedly pro-Israel.
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Their view, and the Israeli view, is essentially if you want to dominate a region that is largely hostile,
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you have this alliance with the peripheral smaller powers in order to constrain the center
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okay and so if you look at where the uae is and where israel is if they both expand they sort of
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get rid of everyone in between i can see that but an also also an argument could be made
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that if if the israelis had not taken the decisions that they had taken um they wouldn't
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be in this situation in the first place which is why which is the depth of the alliance is reflected
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in the fact that despite this war being forced on the uae and then complaining about it officially
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they're doubling down in support of israel and the people who matter in terms of decision making
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yes are more and more vocal in their condemnation of iran and more and more vocal in their support
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for alignment with israel yeah i've seen them criticize everybody iran yes u.s and israel yes
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but they're leaning on doubling down on american israel yes because they have to because they're
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small states and they'll be swallowed if they don't essentially essentially okay and the kuwaitis
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are kind of looking like they're doubling down but they're not making too much of a too much
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noise about it. The Qataris are trying to extricate themselves from this somehow and hoping that if
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Turkey comes out on top somehow their own security is guaranteed. What's Turkey's interest in this
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ongoing situation? Turkey's interest in this is multifaceted. They don't want a very unstable Iran
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on their borders. They don't want the kind of refugee flows that follow which destabilized
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turkey during the syrian war with a population of 20 24 million so i went to turkey um during that
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period of destabilization and that and and you'd go into the city center and there'd be camps of
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syrians literally just in the middle of the street the whole middle of the street would be a shanty
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town of syrians that just turned up yes and they don't want that with iran which is a much larger
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population you're dealing with 90 90 something million people um they also don't want iran to
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be the regional hegemon although they could sort of divvy up bits and pieces between them is that
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because they want to be the do they have incredible yes shot yes they anatolia and persia are built
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like fortresses. And so the expanse around them is their playground, be that the Caucasus or the
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Levant or to a lesser extent the Gulf. And presumably Turkey has a huge advantage in that
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being a NATO member, Israel can't bomb them. Although no NATO country is going to declare
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war in support of Turkey against Israel, realistically speaking. The level of Israeli
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influence over the west is such that this is not a realistic possibility but still bombing a nato
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country when you're not a nato country i mean that does i mean i i agree you will probably end up like
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that but that is a real head scratcher for people who've got to try and explain it to everybody else
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yes it's it's a political problem but it's not an insurmountable one okay and already we're hearing
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the israelis saying that turkey is the next iran i've heard them say that yes i mean it i mean
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surely turkey can't be the regional hegemon it would have to share with iran they did manage it
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in the past with some skirmishes here and there okay i mean most famously islam exists because
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the byzantine empire and the persian empire exhausted themselves in a hundred years of war
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that so enfeebled them that this bunch of desert tribesmen was able to occupy them both eventually
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so there is precedent for them being in uh very prolonged insurmountable conflicts
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there is also precedent for them figuring things out and navigating around each other
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there is precedent for the persians surrounding basara to take it away from ottoman hands
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and trying to contest that area so yes i mean i suppose we have to remember i mean today we
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think of turkey as this sort of second world country that is trying to figure itself out but
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i mean actually it was a great major power yes for a huge amount of history yes and it always was
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holding anatolia gives you an enormous set of advantages some disadvantages because everybody
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around you is because of the sea lanes because of the sea lanes but also because that once you
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dominate Anatolia, you dominate the Fertile Crescent, which is the agricultural area along
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the Euphrates and Tigris rivers, extending into Syria. And from that, you then expand into
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Lebanon and Palestine. And from that, Egypt becomes a target.
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Exactly. And then on the other side of it, you have the Balkans,
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which are fragmented disorganized chaotic so a great empire can enforce order i mean turkey
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was an occupation of ukraine and of crimea and of bulgaria and romania romania and bulgaria
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exist as independent states because the russians defeated the turks and liberated them
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so it is naturally a great power and it's rebuilding its industry and modernizing its
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industry and it is preparing itself to be a great power again i do want to come to israel but perhaps
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before we do what about the smaller nations around israel so the lebanons the jordan jordans yeah
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the so on the israeli ambition is greater israel and the logic here for the israelis is we don't
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have enough people we don't have enough land and so we will take more land and import more people
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from the jewish diaspora yes and so that requires a constant state of militarism and expansionism
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and netanyahu was one of the people who deeply understood that his intellectual forefather is
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is a guy by the name of jabotinsky who was of the view that we have to keep on fighting the arabs
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until we they accept that we're permanently here and since they don't this might be a permanent
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state of affairs until we break them that i mean that feels bold to me because there are small
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countries surrounded by a lot of countries that and and it looked to me like they had been going
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down the path of stabilizing relationships and that made sense to me but they can't fight all
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of them you can't you can't fight the seers the sunnis they believe that since they defeated a
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bunch of incompetent Arab armies in 1948, which were actually outnumbered. Despite the fact that
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there were seven armies, they were actually outnumbered by the Jewish militias. And the
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Jewish militias won, and Israel was established in 1948. In 1967, they beat Jordan, Egypt,
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because this is God's will for them to return to their homeland.
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And what is the temperature check in the region?
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Because you say that the smaller Gulf states are doubling down on Israel.
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The Turks must be listening to them saying that Turkey is the next Iran.
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The surrounding, so what about the smaller surrounding country?
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but what is the temperature check around those other countries?
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between those who want to keep fighting Israel and those who don't.
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There's Sunni Muslims who think we should wait,
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essentially we should wait for Sunni powers to do it,
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and side with the Sunni powers no matter what they say.
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There are some Christians who want peace with Israel.
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And then there is the Shia who largely want to keep fighting Israel
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on the side of Iran to make sure that the Israelis
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don't ethnically cleanse them from South Lebanon,
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which is what the Israeli plan is and this isn't new it was the plan in 1993 it was the plan in
00:28:40.660
1996 it was the plan in 2006 and it's the plan again today in 2026. If you enjoyed that content
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