5 ms·

I want to use the term "vassal state" but even that is not very accurate. They seem to have more control over us than we do them. Our military needs their mone

by finid 10y ago

I want to use the term "vassal state" but even that is not very accurate. They seem to have more control over us than we do them. Our military needs their money to create and sustain critical jobs here and buy billions worth of military tools most of which they barely know how to use.

markdown 10y ago
> They seem to have more control over us than we do them. You're thinking of Israel.
dredmorbius 10y ago
Something of a client state or co-dependency. The US relies on Saudi oil. Saudi Arabia relies on US protection. Each benefit mutually from petrodollar pricing -- the US guards against devaluing its currency (and reducing the value of dollar-denominated assets within its financial system), Saudi Arabia, and virtually every oil-exporting nation, benefits by not having their currencies appreciate in the absence of any meaningful domestic demand for foreign goods. There are other elements, though those are the large ones.
- finid 10y ago
  The US relies on Saudi oil. Actually the US does not need Saudi oil. Yes, we do import from them, but we can easily replace them. We get almost 4x as much oil from Canada as we do from Saudi Arabia, by the way. http://www.eia.gov/tools/faqs/faq.cfm?id=727&t=6 http://www.eia.gov/tools/faqs/faq.cfm?id=727&t=6
  - dredmorbius 10y ago
    Oil is a globally-traded commodity. Saudi Arabia is 13% of global production, and without that, prices would increase markedly as the marginal alternatives are vastly higher-cost (think $120/bbl rather than the current $50/bbl). So, while the US may not burn Saudi oil directly, it is absolutely dependent economically on Saudi Arabia supplying a critical share of global oil. More significantly, as the global surplus producer, Saudi Arabia took over the role the US had played from 1930 - 1971 in setting and establishing global oil prices. The result hasn't been quite so, ahem, well-oiled as the TRO's production quota and certificates of clearance (US Dept. of Interior), but it's been the one handle on extraction volumes, and hence, price, that's been available.
  - Spooky23 10y ago
    Re: Canada... My understanding is that it's not really accurate. -- much of the Canadian oil is oil that is imported to Canada and either transshipped or refined in Canada subsequently imported. The other thing is that while the US isn't necessarily dependent on Saudi oil, key allies and trading partners are. Places like Japan, China, EU states, etc. That gives them a lot of strategic leverage.
- bogomipz 10y ago
  I'm not sure Saudi Arabia relies on US protection that much these days. At one time yes but they're military build up has been well documented: https://www.washingtonpost.com/news/worldviews/wp/2016/04/05/saudi-arabia-passes-russia-as-worlds-third-biggest-military-spender/ https://www.washingtonpost.com/news/worldviews/wp/2016/04/05... Also they are largely running their own war in Yemen against the Houthis. And it the Saudis that are flying those sorties.
  - dredmorbius 10y ago
    In American fighter jets. https://en.m.wikipedia.org/wiki/Royal_Saudi_Air_Force https://en.m.wikipedia.org/wiki/Royal_Saudi_Air_Force
    - bogomipz 10y ago
      And British Typhoons and Hawks. http://www.independent.co.uk/news/uk/politics/uk-has-sold-56bn-of-military-hardware-to-saudi-arabia-under-david-cameron-research-reveals-a6797861.html http://www.independent.co.uk/news/uk/politics/uk-has-sold-56...

by finid 10y ago

markdown 10y ago

> They seem to have more control over us than we do them. You're thinking of Israel.

dredmorbius 10y ago

Something of a client state or co-dependency. The US relies on Saudi oil. Saudi Arabia relies on US protection. Each benefit mutually from petrodollar pricing -- the US guards against devaluing its currency (and reducing the value of dollar-denominated assets within its financial system), Saudi Arabia, and virtually every oil-exporting nation, benefits by not having their currencies appreciate in the absence of any meaningful domestic demand for foreign goods. There are other elements, though those are the large ones.

finid 10y ago
The US relies on Saudi oil. Actually the US does not need Saudi oil. Yes, we do import from them, but we can easily replace them. We get almost 4x as much oil from Canada as we do from Saudi Arabia, by the way. http://www.eia.gov/tools/faqs/faq.cfm?id=727&t=6 http://www.eia.gov/tools/faqs/faq.cfm?id=727&t=6
- dredmorbius 10y ago
  Oil is a globally-traded commodity. Saudi Arabia is 13% of global production, and without that, prices would increase markedly as the marginal alternatives are vastly higher-cost (think $120/bbl rather than the current $50/bbl). So, while the US may not burn Saudi oil directly, it is absolutely dependent economically on Saudi Arabia supplying a critical share of global oil. More significantly, as the global surplus producer, Saudi Arabia took over the role the US had played from 1930 - 1971 in setting and establishing global oil prices. The result hasn't been quite so, ahem, well-oiled as the TRO's production quota and certificates of clearance (US Dept. of Interior), but it's been the one handle on extraction volumes, and hence, price, that's been available.
- Spooky23 10y ago
  Re: Canada... My understanding is that it's not really accurate. -- much of the Canadian oil is oil that is imported to Canada and either transshipped or refined in Canada subsequently imported. The other thing is that while the US isn't necessarily dependent on Saudi oil, key allies and trading partners are. Places like Japan, China, EU states, etc. That gives them a lot of strategic leverage.
bogomipz 10y ago
I'm not sure Saudi Arabia relies on US protection that much these days. At one time yes but they're military build up has been well documented: https://www.washingtonpost.com/news/worldviews/wp/2016/04/05/saudi-arabia-passes-russia-as-worlds-third-biggest-military-spender/ https://www.washingtonpost.com/news/worldviews/wp/2016/04/05... Also they are largely running their own war in Yemen against the Houthis. And it the Saudis that are flying those sorties.
- dredmorbius 10y ago
  In American fighter jets. https://en.m.wikipedia.org/wiki/Royal_Saudi_Air_Force https://en.m.wikipedia.org/wiki/Royal_Saudi_Air_Force
  - bogomipz 10y ago
    And British Typhoons and Hawks. http://www.independent.co.uk/news/uk/politics/uk-has-sold-56bn-of-military-hardware-to-saudi-arabia-under-david-cameron-research-reveals-a6797861.html http://www.independent.co.uk/news/uk/politics/uk-has-sold-56...