Trump backs purge of Saudi royal family – at a price


A man speaks on the phone as he walks past posters depicting Saudi Arabia’s King Salman bin Abdulaziz Al Saud and Crown Prince Mohammed bin Salman in Riyadh, Saudi Arabia, November 9, 2017. PHOTO/Reuters/Faisal Al Nasser

US President Donald Trump has swiftly followed up his Tuesday tweet in support of the great Saudi purge of the kingdom’s elite. A White House statement on Wednesday “welcomed” the allegation by Riyadh that Iran is supporting the Houthi militias of Yemen “including the supply of illegal arms such as ballistic missiles.”

In his tweet, Trump plunged straight into the heart of the power struggle in the House of Saud, saying

“I have great confidence in King Salman and the Crown Prince of Saudi Arabia, they know exactly what they are doing … Some of those they are harshly treating have been “milking” their country for years!”

— Donald J. Trump (@realDonaldTrump) November 6, 2017

On Saturday, even as the Saudi purge got under way, Trump also made a phone call to Saudi King Salman. The White House readout signaled Trump’s support of the imminent purge and also put a price tag on the support – “listing (of) Aramco on a stock exchange in the United States” and, secondly, “the purchase of appropriate military equipment that would keep Saudi Arabia safe and help create American jobs.”

Would very much appreciate Saudi Arabia doing their IPO of Aramco with the New York Stock Exchange. Important to the United States!

— Donald J. Trump (@realDonaldTrump) November 4, 2017

The readout also mentioned that Trump “discussed the continuing threat of Iranian-backed Houthi militias in Yemen and [Saturday’s] intercepted missile attack on Riyadh. They emphasized the importance of countering extremist ideologies and championing moderation and tolerance.”

From these three Trump articulations through last Sunday and Tuesday, the contours of a US-Saudi deal at the leadership level have appeared. It contains three elements.

First and foremost, King Salman and his Crown Prince know they have embarked on a risky gambit by taking on the kingdom’s political and business elite on such a scale. They desperately need Trump’s open support, which will send a big signal to their detractors and opponents within the royal family.

The alacrity with which Trump responded from the Far East amidst a challenging tour of Asia suggests a prior understanding. Conceivably, the three visits by Trump’s senior advisor and son-in-law Jared Kushner to Saudi Arabia in recent months can now be put in perspective. David Ignatius at the Washington Post has written:

“It was probably no accident that last month, Jared Kushner made a personal visit to Riyadh. The two princes (Kushner and MBS) are said to have stayed up until nearly 4 am several nights, swapping stories and planning strategy.”

Now, there is nothing like a free lunch in Trump’s scheme of things. The White House statement on Sunday gives a fair idea of the quid pro quo. It singled out the recent $15 billion deal involving the Terminal High-Altitude Area Defense (THAAD) missile system, which is designed, built, and integrated by Lockheed Martin Space Systems as prime contractor.

Interestingly, there has been feverish speculation lately regarding the main foreign listing of Aramco – London, New York, Hong Kong, etc. Trump has now put his hat in the ring openly and brazenly. (The Saudi Crown Prince has suggested Aramco should be valued at $2 trillion. Independent estimates put the value closer to $1-$1.2 trillion, which would raise $50 to $60 billion if 5% of the company were offered through an IPO listing.)

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