Wednesday, March 9, 2011
Jasmine Revolutions: How Long Will Oil Supplies Be At Risk?
To those who say that the Philippines presents a much different situation than the Middle East, I agree. The Philippines was far better prepared for a transition away from dictatorship and crony capitalism. The differences raise a real concern that the Middle East is in for a long period of uncertainty and instability. This is not a good time for the US economy to be dependent on petroleum.
Who's In Charge?
Long before Marcos left the Philippines, a large and well-organized opposition had developed both inside and outside the country. A new leader, Corazon Aquino, was elected before Marcos was overthrown, and she was able to assume power literally on the day the dictator left. She enjoyed widespread support from the masses and elites, including the full support of the Catholic Church and key business organizations. She also was recognized immediately by the international community as the legitimate leader of the country.
This did not stop powerful factions from attempting to overthrow her new government. President Aquino faced six coup attempts during her first 18 months in office. She continued to fight off coup attempts during her entire six-year term, including one in 1989 (her third year in office) when a faction within the armed forces seized control of 22 high-rise buildings in the central business district and five major military bases throughout the country.
None of the countries in the Middle East will begin its post-revolution period with leaders who have the type of legitimacy and support that President Aquino enjoyed in the Philippines. In some Middle Eastern countries, there is no clear leadership of the revolution. In others, factions will fight among themselves for control or question whether new leaders have enough distance from the old regimes. It will take time before new leaders are selected and establish their legitimacy. This leaves countries in the Middle East at a much greater risk of factional infighting and counter-revolutions. Risks that could disrupt oil production and/or exports.
The Power of Nationalism
Leaders of the Philippine revolution had extraordinarily good and close relations with the U.S. President Aquino attended high school in Philadelphia and college in New York. Fidel Ramos, her critical supporter among the military and her successor as President, studied at West Point and maintained lifelong friendships with many U.S. leaders including his West Point classmate, former U.S. Secretary of State Alexander Haig. Important leaders in the Philippine business community and legal profession studied at U.S. universities. When the People Power Revolution took place, every Filipino over the age of 50 had personal recollections of U.S. soldiers liberating their country from the brutal Japanese occupation during World War II. Some Filipino leaders knew General Douglas MacArthur personally.
Nationalism, however, is a powerful force. Especially when combined with memories of U.S. support for the Marcos dictatorship and perceptions that U.S. businesses had unfairly exploited Philippine resources. A new Philippine constitution prohibited foreign involvement in key industries such as mining and gave preference to Filipinos in all matters of "the national economy and patrimony." The new Philippine Senate refused to renew leases on U.S. military bases and effectively kicked the U.S. military out of the country.
If this is what happened with one of America's closest of friends and allies, we can only guess what might happen in Middle Eastern countries without such close ties or warm feelings towards Americans. Nationalism and less than favorable perceptions of the U.S. could result in very significant changes in economic and strategic relationships.
The Power of Generational Shifts
The Philippines in 1986 and the countries going through Jasmine Revolutions today have one striking similarity. Their revolutions occurred at times of shifting generations. In 1986, more than half of all Filipinos were under the age of 30. Unlike their parents and grandparents who viewed the U.S. and other Western nations with admiration and respect, these young people knew the U.S. mostly as the country that provided money and arms to support the Marcos dictatorship. They saw the U.S. leave Vietnam and the British leave Hong Kong. They saw Singapore, Vietnam, Thailand, China and other neighbors growing economically. Telling the U.S. military to leave the Philippines and reserving economic opportunities for Filipinos was a natural extension of the trends they saw personally in the region.
A similar generational shift is happening now in the countries undergoing Jasmine Revolutions. More than half the people in Tunisia and Bahrain are under the age of 30. In Egypt, Libya and Oman, more than half the people are under the age of 24. In Yemen, more than half the people are under the age of 18. The greatest economic development story in these young people's lives is the rise of China, India, and Brazil to the status of major players in the global economy. In contrast, they have seen the U.S. suffer from severe economic and terrorist shocks. They have also seen the U.S. invade Iraq. Their countries' economic and strategic relationships will form against this backdrop.
The Philippines experience suggests that we will see at least a decade of uncertainty, power struggles, and dramatic changes in economic and strategic relationships in the Middle East. There may be sudden disruptions of oil production and/or exports as factions struggle to control the wealth of these nations and chart a new course. Consistent supplies of petroleum cannot be assured.
Woodbridge, New Jersey
Posted by John Howley, Esq. at 8:06 PM