1960s held together against the tide of protest in the 1960s, when the Free Prince Movement, Arab nationalism, and socialism emerged as genuine alternatives supported by segments of the armed forces and by labor. In the 1970s, with Nasserism laid to rest, the government was already well positioned to reshape the private sector at will.
Unlike that of the Mandate territories, whose borders were drawn by Britain and France at the conclusion of World War I, state-building in Saudi Arabia was relatively free from external influences. Yet the drawing of the contiguous borders of surrounding states had a profound effect on the patterns of political and military authority in the Nejd, whence the first military force capable of conquest and of maintaining order emerged. The new ability to disrupt prior patterns of redistribution by enforcing national borders permitted the formation of a permanent tribal army, which signaled the ascent of the urban communities over the nomadic and provided the military force for the conquest of the Hijaz. Thereafter, a unity of interests that had developed between Nejdi urban groups extended to the Hijazi merchant classes, eventually merging the interests of Hijazi commercial and Nejdi military-political elites. This unity of interests did not precede but rather followed the stabilization of a rudimentary state structure. Military and political unification preceded the formation of a central bureaucracy and a national market, and economic elites formed a stable coalition with the military-political elite only after local legal, tax, and police institutions had stabilized and the promise of a national market under a single, uniform governance became credible.
The stabilization of this coalition transformed business-government relations from secession to support. The origins of the national bureaucracy and the national market are found, then, not in the purposive acts of individual rulers, or in the teleological evolution of "efficient" institutions, but in shifting and ever narrowing coalitions among political-military elites and various social groups. Each coalition, moreover, was forged through intense conflicts in which there were more losers than winners. Only the creation of a uniform legal-military order made it possible to unite the actions of different groups into a mutually comprehensible language of uniform "economic interest" and "rational choice."
The central proposition of this discussion, that the fiscal basis of the state determines its structure, is not in itself remarkable. Indeed, it is central to both Rudolf Goldscheid's and Joseph Schumpeter's classic discussions of the political economy of taxation. The claim here is somewhat more specific. The emergence of central extractive and regulatory bu
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Publication information: Book title: The Price of Wealth: Economies and Institutions in the Middle East. Contributors: Kiren Aziz Chaudhry - Author. Publisher: Cornell University Press. Place of publication: Ithaca, NY. Publication year: 1997. Page number: 96.
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