I've always been "meh" about the Saudis over the years. I know what they are - autocratic Islamic despots - and that the only way in which they differ from other now-former Middle East autocrats like Saddam Hussein, Hosni Mubarek, and Muammar Qaddafi is that they have sat on an ocean of petroleum for decades and made a point of cultivating U.S. friendship rather than going out of their way to alienate us. And it's largely gotten them what they've wanted: to remain in perpetuitous and plutocratic power. And they have been a useful ally in that part of the world and have performed the service of at least buying off and outsourcing the jihadists in their midst as opposed to directly suppressing them.
Or at least it was a service until fourteen years, seven months, and five days ago. Then it became a problem for us. A BIG problem. Though not so big that it manifest itself in congressional legislation to make the Saudis legally culpable for whatever role they might have wittingly or unwittingly played in the 9/11 attacks any earlier than, well, fourteen years and seven months later. Which is why I have a great deal of difficulty taking the vehemence of the bill's sponsors seriously, if not the families of 9/11 victims who have doubtless been seeking this for years. It is an election year, after all.
But the Saudis have have a problem with this bill. A BIG problem. And they're holding, and threatening to unload, approximately three quarters of a trillion very cogent counter-arguments as to why this bill should be deep-sixed to keep Osama Bin Laden company:
Barack Obama will travel to Riyadh, Saudi Arabia on Wednesday amid turmoil over the Saudi government's threats to sell off hundreds of billions of dollars in assets the kingdom holds if Congress goes through with a bill that would allow American courts to hold the Middle Eastern nation responsible for any part in the 9/11 attacks.
The Obama administration objects to the bill, reports the New York Times, and has been lobbying to block it, with State [Commissaria]t and [Obam]agon officials warning senators that there will be both economic and diplomatic issues if the legislation passes.
Last month, Saudi Foreign Minister Adel al-Jubeir, personally delivered a message from the kingdom to Washington, saying his nation would have to sell as much as $750 billion in treasury securities and other assets it holds in the United States, before they can be frozen by the courts if the bill is passed.
I'm taking it from The One's lobbying against the bill that he would veto it if it were to pass and reach his desk. In which case, I have to believe the Saudis are aware of it as well, in which case it isn't going to become law and therefore they should have nothing to worry about, certainly not enough to mortally wound our currency. On the other hand, perhaps the Saudis are concerned that Obama might sign the bill in order to not create a distraction or even liability for Hillary Clinton and congressional Dems in what is shaping up as another potential "blue" wave election and are moving to massively preempt that outcome, in which case that message seems to have already been amply received. Or perhaps the Saudis are overly sensitive about such a public perception being given that high-profile of a validation. "Me thinks thou dost protest to much" and all that.
What this uproar illustrates vividly to me is something that former Joint Chiefs of Staff Chairman Admiral Mike Mullen (retired) said over two years ago: The national debt is, if not the greatest national security threat to the U.S., then certainly among them. All it takes is one of our enemies - the ChiComms come to mind, or even a quasi-friend like the Saudis - to unload a significant portion of that debt, and back comes "quantitative easing," Fed printing presses in maximum overdrive to "buy" it, the dollar going into free fall, etc. A monetary shock akin to OPEC's 1973 post-Yom Kippur War oil embargo. And that gives any major holder of U.S. debt that isn't Janet "Old" Yellen hardcore leverage over us, no matter who's in the White House.
Riyadh's threat isn't being taken seriously by economists in a "They need us more than we need them" sense. Which may or may not be true, depending upon how serious their butthurt over this 9/11 indictment bill really is. But suppose, say, a President Trump launched his trade war with Red China next year and Beijing decided to dump the large chunk of their U.S. debt holdings sitting on the asset side of their balance sheet. The rumors of their moving to replace the dollar as the global reserve currency are no secret. What would there be to dissuade them from pulling the trigger on it?
But I keep forgetting that a President Trump would completely eliminate the $19.2 trillion national debt in eight years with his magic lantern 24% annual GDP growth and $90 trillion economy. Much of it probably looted from Xi Jin-Ping's supersecret offshore bank accounts, doubtless stashed in all those fake islands in the South China Sea. Never mind, I'm just an old worrywart, aren't I?
UPDATE: This will fix the swarthy old ragheads....won't it?