Date:	Sun, 5 Mar 1995 10:36:04 -0500
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From:	wally@cats.ucsc.edu
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Subject: Gulf War


For those who are interested, what follows is a paper Ms. Siemsen
Maki and I gave last year at Irvine; a version will appear in the
PEWS Annual to be published shortly by Greenwood, edited by David
Smith & Joseph Borocz.  At the leat, some of the bibliography seems
relevant to some posters to this thread.

LESSONS FROM THE GULF WARS: HEGEMONIC DECLINE,
SEMI-PERIPHERAL TURBULENCE, AND THE ROLE OF THE
RENTIER STATE


Cynthia Siemsen Maki and W. L. Goldfrank



University of California, Santa Cruz
Santa Cruz, CA 95064





Paper presented at the XVIII annual conference on
the Political Economy of the World-System, Univ. of
California, Irvine, April 7-9, 1994.













LESSONS FROM THE GULF WARS: HEGEMONIC 
DECLINE, SEMI-PERIPHERAL TURBULENCE,
AND THE ROLE OF THE RENTIER STATE* 

footnote on p. 1: *We thank Edmund Burke III and
Paul Lubeck for their advice and suggestions at
several stages of this research.


Cynthia Siemsen Maki and W. L. Goldfrank
University of California, Santa Cruz



Two years ago Wallerstein (1992) published a provocative
essay asserting that the collapse of the Communisms
marked the end of an old era, a liberal era that
began in 1789.  Almost simultaneously, the Persian Gulf crisis marked
the beginning of a new one, a post-liberal era in
which the modernizing program of the French revolution for
national progress had been decisively left behind, whether in
its social-democratic, its Communist, or its
national-development guise.  Not only is liberal ideology 
finished: the capitalist world-economy is 
disintegrating.  The war for Kuwait was
pure realpolitik, he tells us, Saddam Hussein having
understood that only by military might could change
occur in the world hierarchy of power.  Wallerstein
states that the Iraqi ruler did not miscalculate, since he
had an even chance of winning in the short run if
the US did not respond quickly.  And, "the US had a
100% chance of losing in the middle run" (p. 105), because
with relatively declining global economic weight it would
be saddled with increased regional
responsibilities.  Note that he does not
here claim that the winner would be Saddam Hussein, 
or Iraq, or the unified Arab                                           
nation dreamt of by its would-be Bismarck/Nebuchadnezzar, or,
needless to say, the
peoples of the entire global South.  

Wallerstein goes on to find in this military challenge one of
three post-socialist, post-anti-imperialist forms of
struggle from what he sees becoming an increasingly
marginalized South.  (The other two are 
wholesale rejection of the Enlightenment a la
the Ayatollah Khomeini and
"massive unauthorised ongoing migration" [p. 106];
it is not at all clear that any of these three
challenges are really new phenomena.)
This symptomatic reading of events against a
background of epochal transformations may or
may not prove cogent in the long run, but we do not
believe that it accurately captures the causes
and consequences of the second Gulf   
war.  It turns a grandiose fantasist and desperate
opportunist into a clever strategist.  It implies a
more solid Iraq than has yet existed.  It 
neglects the dependence of the US on quite
willing core
country partners concerned both with the rules of the
game of sovereign states and with assuring
that oil supplies and prices remain amenable to core
power influence.  It ignores the dimension of
intra-semiperipheral competition, and the ability of the US to organize
astonishing regional cooperation, involving not only
Israel and Turkey, but also such disparate Arab
states as Saudi Arabia, the UAE, Syria, and Egypt.
Wallerstein's symptomatic reading, then, leaves ample room for
analysis based on more conventional Wallersteinian
concepts, some of them implicit in the original
essay.

To put it another way, the epochal
interpretation invokes trends and especially
discontinuous changes in the overall historical trajectory of
world-system development, whereas our own deals
rather more cautiously with cyclical processes and
familiar world-system patterns.  These two
modes of world-system analysis, the historical and
the systemic, can in principle
be reconciled, but we do not attempt that here.

Rather, in this paper we deploy the concepts of
hegemonic cycles and semi-peripheral mobility to explore some
of the causes
and consequences of the Iraqi wars with Iran (1980-88) and
with Kuwait and the US-led/UN-sanctioned coalition (1990-91).  We
focus first on global changes related to
the decline in US hegemony, 
including the end of the Cold
War.  We
highlight the ambivalence of the US turn to
multilateral financing and multinational forces,
ambivalence that has been recently displayed in
the acrimonious debate over intervention in
Somalia and Bosnia, and that we hold to be characteristic of a
declining hegemon.  We
then trace Iraq's semi-peripheral ascent, as its attempt to consolidate
semi-peripheral mobility was first encouraged and then    
thwarted by shifting combinations of core powers and
semi-peripheral competitors.  We argue that the
post-war continuation of Saddam Hussein's
regime owes itself to such a combination.  Meanwhile,
for Iran and Turkey, the dissolution of the USSR (and
in the former case a wish for rapprochement with the
West) has
induced a redirection of their primary energies
toward competition for influence in Central Asia.  
We imply that one way to understand Middle Eastern
regional instability is in terms of the multiplicity
of competing semi-peripheral countries.  We conclude with some
reflections about the limited utility of the
"rentier state" as an analytic tool. 


HEGEMONY & GULF WARS


Many commentators and analysts have written that the
war for Kuwait represented a reassertion of US
hegemony in the post-Communist unipolar world.
Some give this reassertion a global cast, seeing
messages to Europe and Japan as well as to any
lesser country contemplating a military adventure
destabilizing the world order.  Others give this
reassertion a regional cast, focussing on the 
completion of a transition from British domination
of the Gulf to that of the US.  This
approach would seem to contrast sharply with our own, which sees a 
decline in US hegemony.  However the apparent contrast is primarily due
to our use of a different
conception of hegemony,
one in which the current politico-military superiority of
the US is readily acknowledged, even expected. 

As we understand it, the world-systems perspective
sees recurrent hegemonic cycles in modern history,
distinct from the better known long waves of
rapid and stagnating capital accumulation.  
In each hegemonic cycle, a technologically advanced country
first pushes its economy to world dominance,
defined as the ability to undersell competitors in
their home markets. 
With a time lag, it then gains
politico-military dominance during a period of
major war (the Thirty Years War, the Napoleonic Wars,
World Wars I & II).  Finally its culture and ideology
assert themselves across most of the world.  The
fully hegemonic moment occurs when all three aspects
coincide, when cultural hegemony has been
established but economic hegemony not yet lost.  By
the same token, hegemonic decline follows the same
pattern, with economic competition from other core
states, then politico-military rivalry and eventual
parity, and finally a fading of cultural
prominence.  The declining hegemon becomes just
another core country.  

For the twentieth century, the moment of full-blown US hegemony was
the 1950s and '60s.  Over the last twenty years,
relative economic decline has been unmistakable and
widely remarked upon.  Recently compiled data for
this period show
the US losing ground to its competitors in productivity
considerably faster than Britain did a century
ago (Peterson, 1994).  Meanwhile, to recoup lost
ground, the hegemony that was, Jimmy Carter emphasized the ideology of
human rights and Ronald Reagan emphasized 
military strength.  This odd couple found its
sublime union in George Bush's war against Saddam Hussein, who
conveniently embodied both the antithesis of human
rights and the capacity for military mischief. 
Despite relative economic decline, US politico-military leadership 
continues, perhaps
artificially extended by the peculiar post-WW II burdens borne
by Japan and Germany.  Evidently, the attraction of US culture for
much of the world continues as well.  And in an era when
both armaments and culture are big business, there is an
economic dimension to these aspects of US hegemony,
even in a period of overall decline: US corporations
control large shares of the world market in both,
thus contributing to the motivated capacity for
rebelliousness that leads in turn to US military
interventions.  At some point in the not too distant
future, military might and culture-as-industry may
become mere sectoral specializations of the US
economy, but we do not think that point has been
reached: they are still aspects of a waning
hegemony. 

In a similar way, our view of the Cold War and the demise
of the USSR differs from that of the conventional
international relations perspective.  The usual
view is that the US and USSR were for forty years superpower rivals
in a bipolar world. Each was capable of destroying the
other and the rest of the world along with them,
while competing for hearts and minds and clients.
This is, after all, what the superpowers said they
were doing, and it is not entirely fanciful.  When
the USSR collapsed back into Russia and sought US
help to manage the transition to a market economy,
the Cold War was over, the US had won.  But as
the Chinese leadership saw perhaps first, there had
been a lot of collusion between the superpowers going on as well.   
The Cold War was in fact part of the structure of US
hegemony, in which the Soviets' role was threefold: to police vast
territories and numerous peoples not then necessary
as workers and customers, to provide a threat around
which the US could discipline its allies and
socialist alternative that was increasingly found
unattractive.  Starting from a vastly inferior
position, the USSR declined further and
faster than the US during the world-economic
downturn of the 1970s and '80s, making the advantages of
Cold War arrangements less apparent to the
Kremlin.  No wonder Gorbachev opted out: even the
Soviet military agonized over the poor quality of
the human and material resources it received from
the economy and the educational system.  The demise
of the USSR brought
joy to some and sadness to others, but it meant
diifficult reorientations for all who had been
connected in one way or another to the USSR, as
dependencies, clients, and allies.  

What lessons about the Gulf Wars can we draw from
the causal relevance of hegemonic decline and the
end of the Cold War?  We start with the heyday
of hegemony, and move quickly through the rise of
OPEC, the build-up of the Shah of Iran as a
regional policeman, the threat posed by the Iranian
revolution, the sponsorship of Iraq as a
counterpoise during the first Gulf war, and its
punishment for insubordination during the second
one.

In the decades of hegemonic apogee, the Middle East
supplied the core countries with vast quantities of oil at low 
prices, while slowly, more advantageous rents and
eventually nationalization enabled the producing
states to increase the level of living for at least
some of their subjects.  Politically, the US and the
USSR cooperated in settling the Suez crisis.  The US
intervened successfully in Lebanon and in
overthrowing the nationalist-populist Mossadegh
government of Iran.  Junior partner Great Britain's armed
mobilization dissuaded Iraq from attempting to annex
Kuwait.  Radical Arab nationalism was the principal
ideological threat to the status quo, which included
US sponsorship of an aggressively defensive Israel, a 
modernizing Iran, and the conservative monarchies
and emirates of the Gulf.  The Soviets had their
clients, but were not about to encourage
destabilizing adventures.  

The rise of OPEC in the early 1970s profoundly
altered the picture, globally and regionally.  Oil
price rises redistributed income to the producing
states, at the expense of almost everyone else.
For the US, it was a question of coping with a
balance of power shifting against it.
Since the US domestically produces a higher proportion of 
its petroleum than most other core states, it stood
to gain, relatively, by the price increases.  Europe
and Japan pushed energy conservation and new sources
of supply to counteract the ill effects.
Non-producers in the South were hit particularly
hard.  Meanwhile, the US's 
two principal clients in the Gulf, Saudia Arabia and
Iran, would also gain, not incidentally spending
many of their new petrodollars on US armaments. 
In the Iranian case, oil-fed inflation, 
urbanization, and university expansion had hugely destabilizing effects.
In Saudi Arabia, Kuwait, and the emirates, the vast
increases in wealth led to massive labor migration
from Egypt, Jordan, Palestine, and Yemen (and parts
of South and Southeast Asia as well), making those
countries heavily dependent on wage remittances and,
despite Saudi largesse to governments and movements, fanning the
fires of popular resentment.  In addition, and
little remarked at the time, the oil price rise
facilitated the semi-peripheral advance of Iraq,
thereby adding a new ingredient to the regional stew.

OPEC's price increases were in a sense absorbed by and
evidently instrumental in the
US strategy of sponsoring Iran as a regional policeman.
But that strategy of hegemony through a proxy came a cropper 
when the Iranian
revolution overthrew the Shah, held US hostages, and 
resulted in the installation of an anti-Western
(and anti-Soviet) Shi'ite theocracy.  This was at
once a blow to US domination and an indication that
the Cold War was an increasingly irrelevant
framework for containing, however tensely, the
threat of anti-systemic insurgency.  In its way, the
universalizing thrust of the Iranian revolution
challenged all the regional props of core
domination.  The Soviets, soon in Afghanistan to
defend a client regime, feared the effects of
radical Islam there and in the Central Asian
republics.  The Saudis faced threats to their
guardianship of the holy places as well as a new
surge of anti-monarchic populism.  Fresh from the
Camp David accords, the Israelis faced
new levels of attack from militant groups, while the
Egyptians were isolated from other Arab states and
threatened by home-grown Islamic radicals.  The US
itself foundered badly in a new attempt to
intervene militarily in Lebanon--a telling contrast
to the late 'fifties.  

Enter Iraq.  The decision to
invade its revolutionary neighbor and historic rival
had tangled roots; the immediate spurs included geoeconomic 
and intra-Arab ambitions, political and
ideological defensiveness, and the aim of ousting
the Ayatollah Khomeini from power (see ch. 1 of Hiro 1991 for details).
What was planned as a quick and decisive land/oil/port
grab turned into a stalemated eight-year, million-casualty war that 
severely weakened both countries economically while enriching
the arms industries of many core powers and some
semi-peripheral ones as well (see Timmerman 1991).
Politically repressive regimes entrenched themselves
in both combatant states.  Iraq ended up heavily
indebted to the West, the USSR, and to its temporary
allies in the Gulf.  So long as neither side won, the war
was a godsend for the US, debilitating two states to
this day reviled officially as "outlaws."  When the military
balance shifted toward Iran after 1983, the US
tilted toward Iraq, understanding Iran as the more
dangerous outlaw, but covertly supplied arms and
maintained relations with the latter as well (for a
slightly different slant on US wartime relations with
Iran and Iraq, see Foran 1993).  If the US tilted
toward Iraq, the Soviets listed that way, invoking
their Friendship Treaty and continuing as a major
supplier of conventional weapons.  Yet "at crucial
moments both superpowers reached tacit
understandings: firstly, to ensure that the
Iran-Iraq War did not get drawn into the larger
East-West conflict; and secondly, to guarantee free
navigation to and from the Gulf ports" (Hiro 1991,
p. 264).  Overall, then, the 1980's afforded a
certain respite for the US, but left Iraq with a 
crushing debt burden, a huge military machine, and a new
start toward nuclear capability (Israel had taken
out a major facility in a 1981 raid).

According to documentary evidence reviewed by Foran
(1993, pp. 12-15), the US had since 1985 been
concerned about the threat posed by Iraq to both Gulf stability 
and Israeli security.  Once the graver Iranian
menace had been contained, Iraq could be confronted.
Conversely, with the USSR reduced to a largely
inward-turning Russia, the Iraqi regime was
worried that the US would monopolize power in the
Gulf and attempted to rally Arab support for
rebuffing the US threat.    
We shall probably never know if the mixed signals
sent by the Bush administration in the months
leading up to the Kuwait invasion were intended to
lure Iraq into an adventure that would serve as a
pretext for smashing much of its damage potential.
Consequences count more than intentions.  In the
most careful, detailed analysis we have seen of the US response
to the invasion, Telhami (1994) attributes the October 1990
decision to double US forces and resolve the
situation militarily to a perception that the
anti-Iraq coalition could not last long because of
escalating Israeli-Palestinian tensions following
the Temple Mount massacre earlier that month.
It is a measure of hegemonic decline that to carry
out its military mission, the US had
to rely on UN sanctions and resolutions, 
on Japanese,
German, Saudi, and Kuwaiti financing, 
and on deals with Egypt (massive debt forgiveness)
and Syria ($1 billion and free rein in Lebanon)
(see Kienle 1994; Baker 1994).  By the same token,
it is a measure of hegemonic persistence, and the
lag of politico-military decline compared to 
economic, that the US was able to dominate and
manipulate UN decisions, to extract billions from
its allies, and to construct the
coalition in the first place.  

What of the postwar (or should one say
post-slaughter?) settlement as it has taken shape    
over the last three years?  From the standpoint of
core domination and US hegemony, a slightly new order
prevails in the region, but it is a shaky one
in which ideological heterogeneity and interstate
rivalries complicate, and probably dampen the
radicalizing effects of, tremendous intra-regional inequalities. 
Small populations with lots of oil coexist uneasily
with large impoverished populations, while political
and sectarian creeds compete for mass allegiance.
The two states with oil and people, Iran and Iraq,
continue as "outlaws" in US eyes, to be treated with
a policy dubbed "dual containment" (Lake 1994).  If
the critics of this policy are correct, it is
unworkable and unnecessary: the successful
containment of Iraq requires Iranian cooperation,
and Iran is on its way back toward respectability
anyway (Gause 1994).  US supplies are now pre-positioned
in Kuwait and Saudi Arabia in case trouble arises.

At the same time, steps toward
an Israeli-Palestinian reconciliation may lead  
to removal of a huge stumbling block for core
domination: the identification of Israel as a
militarized aggressive outpost of Western
colonialism and US imperialism.  Iraq itself may
have become a laboratory for the new US/UN mode
of policing the world, of which we are seeing
variants in Somalia, Bosnia, and North Korea.
Not every crisis involves one state's total
eradication of another's sovereignty, so one would
imagine that as crises depart from violations of that fundamental 
principle of the interstate system, they would
become less amenable to UN consensus (even Yemen and
Cuba did not oppose the first anti-Iraq resolutions).
In the last few years, the UN peacekeeping budget has quite suddenly 
jumped from the millions to well over a billion
dollars.  A three-way policy debate has arisen in the US,
among neo-isolationists, go-it-alone hegemonists,
and international institutionalists who favor
working through global and regional organizations.

This last policy will almost certainly prevail in
the middle run, as US hegemony gives way to what may
be called core condominium.  In the Gulf and
the Middle East more generally, the US/West European/Japanese
interest continues to lie in steady oil supplies at reasonable
prices.   But realizing this interest will require
devising a regional political framework that assuages
mass anger and resentment without giving away the
store.  And that means coming to terms with
semi-peripheral turbulence.


IRAQ & SEMI-PERIPHERAL TURBULENCE


It has long been a staple of world-systems analysis
that semi-peripheral states generate an outsized
share of political turmoil, both internally because
of their economic, ethnic, and/or regional heterogeneity and externally
because their attempts at upward mobility sometimes
involve their neighbors.  In the recent global wave of
struggles for democratization, semi-peripheral states have been
disproportionately prominent, in 
Latin America, in Central and
Eastern Europe, in East Asia, and in Southern
Africa.  In the Middle East--so often omitted from
analyses of development (e.g., Gereffi & Fonda
1992)--Israel, Iran, and Iraq have caused the most
turmoil, although one should not forget Syria and
Lebanon, or the nearby hostile rivalry between
NATO members Turkey and Greece.  We focus here on
Iraq's trajectory, as the lessons of the Gulf Wars
are particularly relevant to its ascent, decline,
and possible stabilization.  

At the present moment, virtually all accounts of attempts
at national "development" emphasize government economic
policies, this or that model of growth.  But it is worth
noting that many of the
most arresting semi-peripheral ascents in modern
history have included military conquest as critical
components, from the sixteenth century expansion of
England and the seventeenth century rise of
Sweden and Brandenburg-Prussia (Wallerstein 1974, 1980), to the 
nineteenth century expansions of the US, Russia, Australia,
and Chile,
to the subsequent rise of Japan (Goldfrank 1981).  
In striking contrast to Iraq, however, none of those
ascending states had to contend with significant
core opposition; and although some were occasionally given
a slap on the wrist (War of 1812 for the US, Crimea
for the Russians) or ran
into a semi-peripheral rival, they were all
protected by great geographical distances and/or core
state sponsors.  The world has indeed shrunk, and
one lesson of the second Gulf War is that the
military route to semi-peripheral mobility may well
be a relic.

Iraq's incorporation as a grain-exporting peripheral zone of the
world economy occurred in the latter half of the
nineteenth century, and it remained peripheral until
the 1970's.
During World War I, the British mandate took over
from the Ottomans,
leading to increased levels of agricultural exports and
to consolidation of the class power of landlords.  
(Parenthetically, an oddity in Arrighi and
Drangel's [1986] analytical survey of the
semi-periphery is their classifying Iraq as
semi-peripheral in the 1938-1950 period.  They
qualify this as deriving from a single data point in
a single source [Morawetz 1977], without noting
that another of their sources groups "all the Near
East except Palestine and Turkey" in extreme poverty
in 1938 and rates Iraq as a "prevailing subsistence
economy" in 1948 [Woytinsky and Woytinsky 1953, pp.
390, 434].  Thirty-three percent of the population was
undernourished in 1949, fifty-six percent in 1957
[Darwish and Alexander 1991, p. 15]).
After World War II, petroleum exports began to contribute growing
proportions of GNP.  In 1951 a  
50/50 formula was negotiated for sharing oil revenues between the 
state and the British-owned IPC (Penrose and Penrose
1978).  But most of the 
funds were invested in agriculture rather than
industry (Gerke 1991),
further enriching the rural bourgeoisie, though
making it more dependent on the state.  In 1958, a
military "revolution" overthrew the monarchy,
dissolved the British-influenced Development Board,
expropriated the landed elite, and upped the government's
share of oil rents. 
   
Economic disruption and political instability
marked the ensuing decade.  Petroleum output grew
slowly and the agrarian reform was ill-prepared,
leading to considerable urban migration.  On the
other hand, some import-substituting
industrialization began and landowners lost most of
their power.  State strength grew at the expense of
the urban bourgeoisie under the so-called Arab Socialist
regimes of the mid-1960s, while the brief Ba'th
regime in 1963 had weakened the working class by
eradicating the Iraqi Communist Party.  But
although the partial oil nationalization of 1964 increased
state revenues, industrial nationalizations were
poorly managed, and agriculture continued to decline,
leading to greater reliance on imported foodstuffs
(McLachlan 1979).  For a few years after the Ba'th
return to power in a 1968 coup, Iraq was still a
peripheral country:
troubles with the Kurds in the north and Shi'ites
mostly in the south marked the unfinished tasks of
central government control, let alone national
integration,
even as its strengthened state
and petroleum reserves prepared it for advancing.

Wallerstein (1979) describes three modes of
semi-peripheral ascent: promotion by invitation,
seizing the chance, and self-reliance.  As a member
of OPEC, Iraq seized the chance to nationalize oil
in 1972 and then to use the phenomenal
growth in its oil revenues after 1973 for upward
movement in the world-system.  But there were
elements of "invitation" as well, since France,
Italy, Japan, and the USSR contributed technology
and loans to facilitate increased productive
capacity.  Already in 1974, state oil rents had
mounted to $6.7 billion, contrasted to $487 million
in 1968 (Stork 1982).  Throughout the rest of the
decade, burgeoning revenues bought vast growth in
the role of the state, which came to dwarf any social
group in importance.  Taxes were cut, freeing the
state from dependence on civil society, and funds were allocated to 
services and education, job creation, and subsidized
food.  Ba'th party members penetrated the military
as well as civilian security apparatus, and in 1979
Saddam Hussein, until then formally number two,
became president and commander-in-chief as well as
secretary-general of the party.  The regime bought
acquiescence and some popular support by
distributing benefits, while controlling potential
dissidence through coercion and intimidation
(al-Khalil 1989).  A new private sector elite of
contractors acquired considerable wealth through
development projects but they numbered in the few
thousands and could not form a "solid base for the
regime" (Chaudhry 1991, p. 16), which drew its
nucleus of support from the party-state bureaucracy
itself.  Important positions went overwhelmingly
to Arab Sunnis (c. 23% of the population),
specifically those with clan or local (Tikriti)
ties to the ruler himself.  Perhaps in part due to
the Pan-Arabism of Ba'th nationalism--the post-1958
regime in contrast had instead stressed Iraqi nationalism
(Greenfield and Chirot 1994)--Iraqi economic policy
was dominated by
military mobilization against both Zionism and, 
during the 1980s, Iranian/Shi'i expansionism.

Now as the examples of Brandenburg-Prussia in the 
17th/18th centuries and Japan from 1890-1940
suggest, military mobilization could indeed in the
past be part of
a successful strategy of semi-peripheral ascent.
But in spite of core-state support received during the war with
Iran, both directly and through the lax enforcement
of restrictions on advanced weapons exports,
military mobilization has proved a self-defeating
strategy for Iraq, both by generating overwhelming opposition
and by diverting vast amounts of capital into
unproductive investments and an enormous security
apparatus.  This is not to gainsay that the 1970s
saw economic advances
typical of import-substituting semi-peripheral
countries.  Agricultural output in principal
commodities showed overall increases (Mofid 1990), although 
improved diets and higher incomes meant that
imported food ($1.4 billion worth in 1980) was
necessary to meet demand.  The state-controlled
service sector and state industries absorbed much of
the displaced agricultural work force--Iraq was 68%
urban by 1977--and about 70% of industrial output was
produced by the 280 state firms, with dramatic
increases in iron and steel, fertilizers, and
petrochemicals (Gottheil 1981; Farouk-Sluglett and
Sluglett 1990, p. 233).      

With the wrinkle that petroleum accounted for the overwhelming majority 
of exports in all directions, 
Iraq's trade patterns over the decade also conformed
to the standard semi-peripheral pattern.  Oil sent to the
core was exchanged for capital goods, 
sophisticated consumer products, and arms; oil sent
to the periphery was exchanged for minerals 
and low-wage manufactures.  Also typical of
semi-peripheral countries was the shift in the
relationship between social classes and the state,
with the latter gaining at the expense of the
former.  Furthermore, as controllers of a rentier state dependent
on a commodity with low labor force requirements, the
Ba'th party elite was unusually unconstrained by
class pressures, a pattern very different from those
semi-peripheral states in which class forces are
extremely heterogeneous and conflicting.  This meant
that structurally, the individual at the head of
this elite (recall that Saddam Hussein assumed the
presidency in 1979) enjoyed a very wide
range of autonomous decision-making.  His decision
to invade Iran in 1980 ended up squandering many of
the gains of the 1970s, reducing the state's
autonomy vis-a-vis other states and domestic
classes, and stalling if not reversing Iraq's
ascent in the world-system.

Earlier we discussed this war from the perspective
of hegemony.  From that of Iraq's trajectory, it was
a disaster: one analyst estimates its cost to have
been $452.6 billion.  Saddam Hussein had positioned himself
as the most logical Arab standard bearer after Egypt's deal
at Camp David; a quick victory over the supposedly
disorganized Iranians would remove the misperceived threat
of revolt by Iraqi Shi'ites, liberate the Arabs and
the oil of Khuzistan, and establish Iraq as the
dominant regional power.  It was not to be: after
initial setbacks, the
Iranians rallied, and as the war came to be politically
useful to the revolutionary regime, they insisted on
armistice terms Saddam Hussein could not accept.
Iraq's pursuit of a guns and butter policy could not
last, as foreign reserves dwindled and oil exports and
prices dropped, so that its contribution to GDP
averaged only 30% a year during the war, down from 
55% in 1979.  Labor scarcity from military
recruiting negatively affected both industrial and
agricultural output.  Yields declined and foodstuff
imports grew, to $3 billion by 1987.  The only way
out was increased indebtedness, which reached $81-89
billion by the time the war ended (Hiro 1991), much
of it owed to the Gulf states, less than a third to
the West and Japan, and $6-9 billion to the USSR. 
Only in military capacity did the war strengthen
Iraq, as the state built up a huge army and an enormous armaments
industry (Eilts 1991).  

The major economic policy reorientation toward the
end of the
war was the privatization of some commerce,
industry, and agriculture.  Designed to increase
productive efficiency and possibly to impress
Western lenders, privatization had negligible
effects, aside perhaps from shifting some of the
blame for shortages away from the government.
The main beneficiaries were the contractor
intermediaries who remained dependent on the regime
for preferment (al-Khafaji 1990).  In no sense did
they become a vibrant class for itself that might
spearhead the next phase of Iraqi economic growth,
similar, say, to the state-created industrial
bourgeoisie of South Korea.  Nor were they or any
other element of civil society in a
position to oppose the decisions to invade Kuwait and 
not to yield to US/UN diplomatic pressures.

Iraq's decline did not stop with the end of the
Iranian war.  Foreign debt continued to grow,
privatization was not stimulating the economy,
Western banks were refusing additional loans.
Looting Kuwait and then controlling its oil and ports
could reverse the decline and allow Iraq to resume
its march toward unifying the Arab nation to undo
the consequences of a colonial past.  But as we have
argued, the global
consequences of Iraq's annexing Kuwait were too
grave for the US.  As Farsoun (1991, p. 3) put it,
"Iraq's bid for regional hegemony threatened US
global hegemony in which oil, especially Middle
Eastern oil, plays a pivotal role."  

Beyond the obvious massive damage done by the US/UN to its
population, military machine, infrastructure, 
agriculture, industry, and oil-exporting activities, Iraq shows other
indications of regressing toward, if not all the way
to, peripheral status.  The power center contracted
to a very small group of Saddam Hussein's intimates
and ultra-loyal officers to prevent a coup
d'etat (Khalidi 1991).  About ten percent of the
pre-1958 elite have resurfaced as elements of the
bourgeoisie and as major contributors to the regime
(al-Khafaji 1991), as state oil rents no longer
enable it to exist above classes.  In addition,
traditional tribal chiefs have begun receiving large
salaries in return for support (Middle East 1992, p.
15).  And foreign firms were invited to help develop
new oil fields and increase yields from old ones
during the economic crisis that followed the war
with Iran.    

On the other hand, the ability of the army to
suppress the Kurdish revolt and to punish the
southern Shi'ites for their rebellion--both groups of
course cynically encouraged then abandoned by the
US--suggests that Iraq was not bombed as far back as
some first thought.  So does the rebuilding that has
occurred in the last three years, in spite of
considerable suffering and middle class exodus.
Ninety percent of oil export capacity has been
rebuilt (Feuilherade 1992), and prewar levels of
production could be reached in a year after the 
UN bans are lifted (Tanner 1992).  Of course, thirty
percent of oil revenues are owed Kuwait as
compensation, the massive foreign debt remains, and
much infrastructure requires rebuilding.  On balance
we think Iraq will survive as a semi-peripheral
country, albeit a weakened one, 
most importantly because Turkish fears of Kurdish autonomy  
and Saudi fears of the southern Shi'ites converge
upon the goal of a unitary but hamstrung Iraq.  And
with the second largest proven oil reserves in the
world, Iraq should have the opportunity to undertake
renewed upward mobility in the world-system by
means other than military ones.


CONCEPTUAL CODA: THE RENTIER STATE


The term "rentier state" has infiltrated the vocabulary of
the social sciences.  For the most part, it has been used to
describe the oil producing countries in accordance with
conceptualizations set forth by Middle Eastern scholars.  The
role of the state as the principal economic actor resulting from
income based on external rents was first conceptualized by
Hossein Mahdavy (1970).  The key assumption of the rentier state
literature is that the source of state revenues affects a
country's 
political and socio-economic conditions.  

Three tendencies are said to accompany the flow of external rents 
into the domestic realm. 
First, the state 
strengthens its relative position, as it is  
less constrained by
class pressures; where the state does not depend on taxes for
revenues, political demands and participation diminish
(Beblawi 1987).  This
configuration has its own inherent contradiction: the state rules
over society without the support of a social base.  Second, state
revenues will be independent of internal productive activities;
state rents amount to locational gifts of nature.  A close
corollary is that only a small percentage of the
population will be involved in the rent-generating process,
however much the majority may benefit from it.  Third,
the model
asserts that allocating economic and social benefits buys
legitimacy for the rentier state.  Whereas Weber argues that
legitimacy
exists insofar as people agree with the rules of the institution
(Gerth and Mills 1946, p. 294), in the rentier state paradigm
legitimacy is said to obtain through popular
expectations of economic
entitlements.  Though one could contest this
usage of "legitimacy" (is this not
support or mere
acquiescence?), clearly state authority can be enhanced
through purchasing such valuables as the loyalty of military 
officers (Salame 1987).

Despite the number of states which might be categorized as
"rentiers" in the world today, or throughout the history of the
modern world-economy, it remains an unexplored type in both
the world-systems and state-centric literatures. 
To treat the latter first, 
Skocpol (1982) mentions this variant in her work
on the Iranian Revolution, and Evans (1985, 1992) presents
some applicable ideas in his discussions of predatory states. 
Nevertheless it appears that when
the state was brought back in, the rentier state was
left out in the desert.  But the underlying assumptions
of the state-centric approach emerge in the rentier state
paradigm as well:  1) state structures are the point of departure; 
2) states are the
primary actors; and 3) state pressures dominate over class and
economic pressures.  Where the state-centrists focus
in part on state-class relations, however, the
rentier state model virtually ignores social
classes.

We find at least three ways to look at class as an issue in
the rentier state model.  First, the absence of class in the
literature speaks volumes of the trend toward authoritarian
state/class relations in these regimes.  Second, when a state is
"legitimated" through entitlements, class pressures force benefits
to remain as a form of abating those pressures.  
Third, the model's claim that the
state has enough autonomy to act on its
own without concern for either dominant class or mass interests should
give way to 
a more interactive analysis that views the rentier state
historically, with a changing balance of power in state and
class structures.  

The world-systems understanding of the rentier state must treat the rent
arrangements states adopt as efforts to alter or consolidate
their positions within the world system.  We argue this holds
true for sixteenth-century Spain with its precious
metals inflows to
maintain the empire and for seventeenth-century Sweden through
its control of copper, iron and tar as well as for contemporary
oil producers. 
Certainly an exploration of the proportion of external
revenues to overall state income would be required to determine
if Spain or Sweden could be categorized as rentier states in
those periods.  The point here is that "rentier-ness"
has existed in the past and has served as a means of mobility and/or
maintenance of position within the world-economy.
Nor is control over a valued resource the only
source of rents: locational and/or geopolitical
rents can prove advantageous as well.
By geopolitical resources we mean
the opportunity to secure rents 
through foreign aid and loans because of their strategic
location, as South Korea and
Taiwan did during the Cold War.

It is our impression that rentier states are usually
part of the semi-periphery, though not 
necessarily long-term members occupants. 
Arrighi and Drangel (1986) show the propensity of these states to
move into and out of the semi-periphery.  For example, both Saudi
Arabia and Libya were on the upper cusp of the semi-periphery in
the period 1960-70 but were classified, on the
perhaps problematic sole criterion of wealth per
capita, as core from 1975-83.  In
this regard, rentier states are emblematic of the perennial
change-within-continuity of the capitalist world-economy in general,  
including the tendency of semi-peripheral
countries to change their location within the world-economy, more
so than core or peripheral countries.  But rentier
states differ from other semi-peripheral ones in
that they
exchange a no-wage commodity for high-wage commodities 
with the core and the same no-wage commodity for low-wage commodities 
with the periphery, thus achieving their intermediate
position.

Wallerstein (1979) asserts that semi-peripheral states are more
involved in political and market control (both domestically and
internationally) than core or peripheral states, "since the
semi-peripheral states can never depend on the market to maximize,
`in the short run,' their profit margins" (p. 72).  
Rentier states differ somewhat here as well, because
it is their long-run profits that are at risk.  They
seem to have a short-term window of oppportunity in
which to use their rents to invest in major transformations.
For those with small populations, this means a
diversified portfolio of core country properties.
For those with sizable populations, it means
technological and administrative modernization. 
In recent decades, political involvement in the
market by oil rentier
states has included both the 
transnational syndicalism of OPEC and various
ambitious investment programs, of which Iraq's
military-inclined variant is one.  From this perspective,
Beblawi (1984) may be right that in the long run, the oil states may
return to the periphery though many have been promoted
temporarily to the semi-periphery (or even core) based on the
importance of oil to today's world-economy.  

The concept of "promotion" within the system and the
importance of a natural resource to the capitalist world-economy
situate the strategies states adopt within the dynamics of a
system which works to the advantage of core capital.  The power
of a core sponsor will enhance the capacity of the rentier state
so long as the core is simultaneously strengthened.  In
this view, the vulnerability of the rentier state is not
limited to the domestic arena through the eventual depletion of a
resource.  Instead, while states may grab their portion of
international capital while they can, they are exceptionally
vulnerable to price fluctuations, as well as
to the geopolitical constraints imposed by core powers. 

What of the issue of class constraints?  The rentier state
paradigm asserts that the autonomous allocative state undercuts
old elite classes and flattens political opposition.  But it is
erroneous to suggest either that a new elite does not emerge
directly tied to transnational capital, or that through the
distribution of benefits a large middle class is not created
which might pressure the state.

Let us conclude by recapitulating the lessons we
have drawn from this conceptual exercise, then
return to Iraq and the Gulf War.
Rentier states in general
should not be theorized from the characteristics of the oil producers
in particular.  To be comprehensive, the analysis of rentier states 
requires cross-national and trans-historical comparisons.  State/class
relations are variable and changing, as are the global demand
for particular commodities and the strategic value
of particular locations.  Population size matters.
Rentiers and semi-peripheral mobility seem to go
together.  In the case we have examined, oil rents
led to revolution in Iran and to a military strategy
for advance in Iraq, neutralizing one another at a
fearsome cost in lives and livelihoods.  The costs of Iraq's
initial failure prompted it to try again, even more
disastrously.  Core power, in this instance under
the leadership of a declining but still potent US,
thwarted a potential challenge both to core
domination of a critical region and to the
precarious
balance of power among competing semi-peripheries.
Quite possibly, the military path to semi-peripheral
advance is no longer a viable option. 




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