George W. Bush likes to think of himself as a powerful and influential world leader. Yet the evidence screams loudly in the opposite direction. One begins to wonder if members of the Bush administration have read anything newer about Arabia than Seven Pillars of Wisdom: A Triumph by T.E. Lawrence (better known to Americans as Lawrence of Arabia thanks to the movie). Their ignorance of the region is going to cause serious repercussions to the welfare of the United States.
At the beginning of March, Saudi King Abdullah hosted talks with Iranian President Mahmoud Ahmadinejad. No major improvements in their relations were announced after the talks concluded, nor any significant efforts toward stabilizing the region. But something significant was certainly discussed, based on subsequent actions.
Just the other day, Abdullah cancelled his presence at the April 17 formal White House state dinner - for unspecified reasons. Those reasons became clear shortly afterward when Abdullah denounced the “illegitimate foreign occupation” of Iraq by the United States and declared that Arab nations "would not allow any foreign force to decide the future of the region."
One has to wonder how much effect this declaration had in scuttling the incompetent Condi Rice's pitiful attempts to accomplish that very thing. But there is a much more important development that will affect our country directly: The movement of foreign nations to conduct business in currencies other than the dollar is accelerating.
In Dubai - the new "home" of Halliburton - Dubai International Financial Centre CEO Nasser al Shaali recently announced that Gulf economies will move away from a link to the dollar and convert their foreign exchange reserves to other currencies, including the Chinese yuan. This has to be welcome news in Beijing as China’s state-run Zhuhai Zhenrong Trading buys roughly 240,000 barrels of Iranian crude per day, currently paid with euros. Chairman Fukuaki Watari of Japan’s top refiner, Nippon Oil, said the Japanese companies had all received informal encouragement from Iran to pay for their 500,000 barrels per day of Iranian crude on non-dollar terms - a request that may be forthcoming soon as American markets are affecting the yen.