Saudi Arabia’s New Challenges: A Conversation with Greg Gause (S. 5, Ep. 2)

Saudi Arabia is facing challenges: the global oil slump, the future of the GCC's collective stability and its intervention in Yemen. "Yemen was the place they decided to strike back," Greg Gause tells Marc Lynch in this latest POMEPS podcast. "I think both because they've always seen it as their backyard — part of their special preserve — where they were least likely to directly confront the Iranians. You do something like they're doing in Syria, and you're fighting the Iranians directly." There are signs, Gause says, that an end may be in sight. "The fact there was a Houthi delegation in Riyadh in April show that those in charge are looking for an exit ramp." Saudi Arabia's economic challenges lie beyond low oil prices. "The Saudi private sector has been a job creating machine in the last decade. It's just that almost all of those jobs have gone to foreigners...the real core of this how do you make it so Saudi private sector hire more Saudis without destroying the business model they've created. I don't see that in vision 2030." Gause says he believes the stability of Saudi regime is sound. "Fiscal crisis can create regime crisis." But Gause notes, "I don't see the kinds of fissues in the ruling family that could lead to serious problems in Saudi Arabia." Back in the 1980s and 90s, Saudi Arabia "ran their debt up to a 100% of GDP. There's no indication the Saudis won't be able to sell their government bonds. I think they actually have plenty of room to put off fiscal crisis." Looking beyond Saudi to its neighbors, "when things are really serious, the GCC comes together." But, Gause warns, "It would be a mistake for us to overestimate the policy coherence of the GCC, even now." F. Gregory Gause, III is the John H. Lindsey ’44 Chair, Professor of International Affairs and Head of the International Affairs Department at the Bush School of Government and Public Service, Texas A&M University.