Complex web of economic ties muddles Middle East policies

By Diane Secor, The People, Vol.108 no.6, September 1998

American capitalism operates such a complex web of business ties and ventures in the Middle East that it is easy to see how its political wires could get crossed and emit conflicting signals. It was recently suggested, for example, that the United States let it be known that it wanted the U.N. inspection team that is scouring Iraq for concealed weapons to slacken up so as not to precipitate a crisis. Secretary of State Madeleine Albright promptly denied the rumors, but that only underscored the point.

Some Middle Eastern interests have become an integral part of the U.S. capitalist system itself. For example, Prince Alwaleed bin Talal, nephew of King Fahd of Saudi Arabia, is the largest single shareowner of Apple Computer. He also has significant holdings in other multinational corporations such as Citicorp and Euro Disney.

Israel also has forged close economic ties to major U.S. companies. In the semiconductor equipment sector, for example, the president of Applied Materials Inc., Dan Maydan, and the company's leader in Israel, Dan Vilenski, have crafted hundreds of complex U.S.-Israeli joint ventures. U.S. businesses such as IBM, Intel Corp., Microsoft Corp. and Motorola Inc. also have invested heavily in Israel.

These enterprises have ramifications far beyond bilateral commercial relations. Check Point Software Technologies Ltd. has major branches throughout Australia, Asia and Europe, as well as in Israel and the United States. High-tech research and development in Israel has also been bolstered by the immigration of highly skilled workers from the former Soviet Union.

Although the number of skilled jobs is expanding in Israel, Israeli workers in lower skilled occupations are suffering from greater unemployment as Israeli capitalists relocate plants to Egypt and Jordan to cut down on their labor costs. Some Israeli workers have become so desperate that they have implored King Hussein to permit them to find employment in Israeli-owned factories in Jordan!

This relocation of industry is how Israeli capitalists and the capitalist state have responded to Israeli workers' demands to maintain higher wages and more decent working conditions. Last year the Netanyahu administration was forced to make some concessions to workers when a general strike was organized by the Histadrut labor union. However, the government subsequently took action to try to smash the union and roll back whatever gains the workers made.

Growing Palestinian high-tech companies also are seeking investors to upgrade technology in private industry and in social institutions like schools and hospitals.

Syria is luring more foreign high-tech investment with its low labor costs and conditions generally favorable to investors, not to workers. American companies are pushing the Syrian government to relinquish its tight grip on state-owned businesses to allow foreign investors to move in. Naturally this has met with some resistance by some officials to protect their lucrative domain. Others in the Syrian regime hope to cut deals with U.S. capitalists to bring in the Internet. Syria has toyed with some peace overtures toward Israel to placate foreign investors who do not want to jeopardize their own interests in Israel.

Many U.S. interests have their fingers in the Middle East pie. The conflicting political signals are conflicting only on the surface. Beneath the surface there is a consistent signal. That signal is to do whatever political juggling is necessary to safeguard U.S. capitalism's complex web of business ties and ventures in the Middle East.