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How to Escape the Oil Trap

(Newsweek) Fareed Zakaria - Reducing our dependence on oil would be the single greatest multiplier of American power in the world. Over the last three decades, Islamic extremism and violence have been funded from two countries, Saudi Arabia and Iran, not coincidentally the world's first and second largest oil exporters. Both countries are now awash in money and, no matter what the controls, some of this cash is surely getting to unsavory groups and individuals. Saudi Arabia will probably have a budget surplus of more than $26 billion this year because the price of oil is so much higher than anticipated. That means it can keep the old ways going, bribing the Wahhabi imams, funding the Army and National Guard, spending freely on patronage programs. (And that would still leave plenty to fund dozens of new palaces and yachts.) Ditto for other corrupt, quasi-feudal oil states. Tehran has launched a breathtakingly ambitious foreign policy, moving determinedly on a nuclear path, and is also making a bid for influence in neighboring Iraq. This is nothing less than an attempt to replace the U.S. as the dominant power in the region.
2005-08-26 00:00:00
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