Ben Bernanke says that oil inflation is only “transitory”. Wishful thinking. Excerpts from Robert Kaplan’s WSJ article:
- Despite the military drama unfolding in Libya, the Middle East is only beginning to unravel. American policy-makers have been spoiled by events in Tunisia and Egypt, both of which boast relatively sturdy institutions, civil society associations and middle classes, as well as being age-old clusters of civilization where states of one form or another have existed since antiquity. Darker terrain awaits us elsewhere in the region, where states will substantially weaken once the carapace of tyranny crumbles. The crucial tests lie ahead, beyond the distraction of Libya.
- In the Middle East, the status quo is unsustainable because populations are no longer afraid of their rulers. Every country is now in play.
- Yemen, strategically located on the Gulf of Aden, as well as the demographic core of the Arabian Peninsula and a haunt of al Qaeda, is more important to American interests than Libya.
- However badly Mr. Saleh has ruled Yemen, more chaos may follow him.
- The era of a dependable, pro-Western Jordan living in peace with Israel may not go on indefinitely. Bahrain, meanwhile, may descend into a low-level civil war. The country’s Shia have legitimate complaints against the ruling Sunni royal family, but their goals will play into Iranian hands.
- Yemen, Jordan, Iraq, Bahrain and the other Gulf states are all individually more important than Libya because they constitute Saudi Arabia’s critical near-abroad. In this era of weakening central authority throughout the Middle East, the core question for the U.S. will be which regime lasts longer: Saudi Arabia’s or Iran’s.