by Dan Perkins
Clash Daily Guest Columnist
President Barack Obama is headed for Saudi Arabia this week under a threat from Saudi Arabia that if America releases the 28-page report on the involvement of Saudi Arabia in 9/11, they do so at their own peril. Congress is considering a bill to allow individuals to sue the Kingdom as a result of the Kingdom’s involvement in 9/11.
The Saudis say, “If the Congress takes actions and the President signs the bills they will sell $750 billion of US assets and put the American economy at risk.” The most liquid assets that they would have to sell would be US treasury securities. At a time when Saudi Arabia has seen no significant movement in the price of oil, and Saudi Arabia finds itself strapped for cash to run its government, it makes no sense, when you’re strapped for cash, to sell your most liquid assets.
Let’s deal with the $750 billion amount. According to the US Treasury Department and the US Federal Reserve, OPEC nations in total, own approximately 1.5% of all outstanding US Treasury debt as of the summer of 2014. The government does not breakdown what percent of the 1.5% Saudi Arabia owns, but the point is that, with the US Government debt market at $19 trillion, one and a half percent if it all, would not move the market.
The rest of the Saudi money is tied up in equities, hotels and other forms of real estate. Stocks could be sold and cause some short-term dislocation in the markets but everything else would take a much longer time to liquidate. So the question becomes, why would they threaten to sell $750 billion dollars worth of assets when they can only sell a small portion of those assets in the market?
As you may recall, I was one of the first to write in November 2014, over Thanksgiving weekend, that Saudi Arabia and the rest of OPEC had declared war on the United States by refusing to reduce production of crude oil. The slide in the price of crude caused a significant slide in revenue to all the OPEC nations including Saudi Arabia. Their actions put the world on the verge of a recession.
The current market price for crude oil is woefully short of what Saudi Arabia needs to balance its budget. Given the prospects of continued oil prices below the cost of what it needs to avoid a deficit in their budget, Saudi Arabia could be marching closer and closer to bankruptcy.
Under the present US law, remote countries have a level of safety from being sued in American courts. The Outside Sovereign Immunities Demonstration of 1976 is one reason why victims groups of the September 11, 2001 terrorist assaults neglected, to a great extent, to convey to the court that the Saudi Imperial Family and foundations provided monetary support for the assaults.
There is legislation in the US Congress started in the Senate that would waive the insusceptibility for cases including terrorist assaults that murder US subjects on US soil, as an example the World Trade Center Bombing on 9/11. Introduced by Republican Representative John Cornyn and Democrat Congressperson Toss Schumer, Congress figured out how to overcome factional divisions in the US enactment and went without difference through the Legal Board in January.
Couple to this legislation is the increasing demand for the release of the 28-page section of the 9/11 report, which was never made public. This report is so secret it can only be viewed by certain members of Congress with specific clearances and is available for read only in a secure room in the bowels of the US Capitol.
No notes, no photographs, nothing can be made of this 28-page document by visitors. While nobody knows for sure what is in the 28-page document those who have read it have indicated that it is indicting to the Saudi Arabia Government and individuals within the country.
Here’s the dilemma for President Obama, with a Republican controlled Congress there is every likelihood that the legislation will pass, and that would allow American Family members of those who died in the 9/11 attack to sue the Saudi Arabian government if the President signs the bill. In addition, in separate legislation there may be an order to release the 9/11 28-page report for everybody to be able to read.
I have no doubt that with the President’s visit to the Kingdom both of these issues will quickly come to the surface. I do not know what commitment the President of United States we’ll make it to the Saudi’s about his intention to veto both pieces of legislation, but I believe he will try to defeat it before it gets to him so he will not have to veto the bill. The question that must be going through his head, can he kill these bills?
The risk that the President has is that members of both parties are behind the legislation and the release of the 28-page document is making it very difficult for the President’s veto to be sustained. The rationale to the American people as to why the President would veto this legislation, could be very damaging to the Democratic Party in general, and in specific the November election. With Mrs. Clinton and Mr. Sanders both avid supporters of what the President has done while in office, it may be very difficult for them to sustain his veto.
Is this intimidation or blackmail on the part of the Saudis? The President has been to the Kingdom before and has bowed before the King and the country apologizing for America’s imperialism. I have no doubt the President Obama will say to the King that he will do everything within his power to protect the Kingdom from harm, for America has already harmed the Kingdom enough.
Dan Perkins as a current events commentator for TheHill.com, TheDailySurge.com, and ReaganBaby.com. He is the author of the trilogy on radical Islamic nuclear terrorism against United States called, The Brotherhood of the Red Nile. He can be heard on Tuesday evenings at 8 PM Eastern on W4CYradio.com.