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April 24, 2008

Aleem : Urban Digs

Rising from the Sands

« CO2 Map | Main | Rethinking Urban Politics »

From next week's Economist:

A great piece on the rise of the Middle East economies including an interesting story with some background on the City of Dubai.

Having been to Dubai a few times, I can tell you that the story out there is compelling.  This one city is home to a quarter of our planet's construction cranes, they are spending massively to diversify their economy into industries such as IT, bio, media and manufacturing as oil reserves shrink.  Separately, Dubai has allocated a massive $15 billion dollars for public infrastructure alone over the next five years.

But is this sustainable?  Even though many Middle East cities are flourishing attracting talent and harnessing technological assets, can these places be models for the other big "T" that being, tolerance?   What do you think?

Aleem Kanji

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Robert

Actually Dubai, UAE and other oil rich countries don't need to be tolerant of homosexuals, foreigners, or anyone else because they have the enormous amounts of money from oil. The money will buy any technology, labor, products they need from around the world. There is so much poverty in the world that even if Dubai put out a big sign saying "We hate foreigners" in Chinese and had a full time greeter at the airport whose job was to spit at Chinese construction workers as they came off the airplane , Chinese workers would still come not because they like Arabs, or getting spit on but because of the relatively high salary they could make in Dubai versus China. If the salary is high enough then people can take a lot of crap. However, if Dubai ever supports Taiwan independence then those Arab morons might find their previously mistreated construction workers coming back as hostile soldiers looking to even the score.

Ironically, if America keeps interfering in Chinese internals affairs such as supporting the Dali Lama, and supporting Taiwan independence then many Chinese people that were mistreated in America might come back to get even as well.

Michael R. Bernstein

"can these places be models for the other big "T" that being, tolerance?"

They could be, but they won't. This is the sort of thing where strong leadership from the top could make a big difference, but that leadership has no incentive currently to push for Tolerance (it's too easy to scapegoat the Other to cover for the lack of broadly participatory political systems (and forget actual democracy). The culture is so strongly hierarchical (everybody has someone to look down on), it's scary.

Michael R. Bernstein

I should have concluded: This means that many of the most Talented success stories will flee for enclaves of Tolerance elsewhere once they have made a fortune (or even a grubstake), and the resulting brain-drain will be huge. They could try to create some kind of alumnus/expat network to try and leverage the phenomenon, but I don't think it would work unless it was actually an offshore and independent effort.

Whitney Gunderson

A January 21, 2008 issue of BusinessWeek put this issue in perspective for me. Luckily, I saved it so I can relay some interesting information.

On page 42, the article "Who's Afraid of Mideast Money" states that "Six Gulf states - Abu Dhabi, Dubai, Kuwait, Oman, Qatar and Saudi Arabia - account for nearly half of the world's sovereign wealth fund assets. They control some $1.7 trillion, as much as all of the hedge funds in the world and more than the $1 trillion private equity industry - and Morgan Stanley predicts the total will grow by about $400 billion annually over the next several years."

Then on page 66, the article "How to Survive the Credit Crunch" begins with an observation that puts United States' debt into a consumerism context: "A massive citadel of consumerism, the Mall of America [Minneapolis, Minnesota] boasts some 520 stores in a space big enough to hold 32 Boeing 747s. Spend a few hours there and big numbers stop fazing you - numbers like the record $2.5 trillion in U.S. household debt, which rises to $13.6 trillion with mortages tossed in."

The point is that United States' debt, including mortages, is $13.6 trillion. Combined, six Gulf states have $1.7 trillion in soverign wealth fund assets. So, let me get this right.... Our debt is eight times more than what they hold in liquid assets? That is striking, and really shows just how rich (and in debt) the United States is.

Also this for trivia - the word mortgage comes from the French root "mort," which means "dead" and the Germanic root "gage," which means "pledge." Lately in the United States, quite a few people haven't been taking their dead pledges very seriously.

hayden fisher

The world will change dramatically over the next 10 years and the ME's reliance on oil profits will be about as reliable as Microsoft's next Windows release; and both will cede to competition. The alternative energy movement is about to transition from enviro-green to capitalismo-green as we and the world move rapidly away from reliance upon ME oil. So the race is on, can the new ME tigers build economies AND communities quick enough to recalibrate before realizing the loss of windfall oil profits in the near future. Probably, but not without challenge.

The ME will not become the next US because it lacks our cultural diversity and the other "ITS" that make America America. But the region could and should become the next Japan.

Whitney Gunderson

Aleem - As you have been to the region several times, do you think Dubai and the Middle East are already more tolerant than we tend to give them credit for?

Aleem : Urban Digs

Thanks for the question Whitney. Its a fairly general one you are asking, but I would say yes to Dubai. Change takes time, changing perceptions takes time the same way it does in the west - they are getting there, in time.

Whitney Gunderson

Aleem - thanks for the response. You seem like you very are passionate about this issue. I think as the Middle East economy is forced to diversify away from a declining natural resource, oil, and the huge revenues that come from pumping it, that the value of tolerance in this region will become greater. Perceptions are what they are. That may sound too George W. Bushish, but perceptions may change faster than we think they do, and they are only perceptions.

Wendy

A former co-worker moved to Dubai to head up a real estate development there. I visited him during a layover a few years back as he was first adjusting to life where you have no rights -- that's right, foreigners have no rights in Dubai. They are there as guests of the emirs, essentially.

My friend explained that if you make one false step, you could be kicked out of the country immediately. One false step is driving after one drink and getting caught. One false step is getting in a traffic accident with the wrong person.

Tolerance is not going to happen in such an environment. Moreover, the talented are not going to stay and raise their kids there. You cannot become an emirate citizen if you were not born one (even if you have a child there, your child will not be an emirate citizen either, as I understand the rules).

So, people like him with talent and experience go to Dubai for a few years to make more significantly money than they could at home. But they have no plans to stay when their contract is up. No plans to build a long term life there. They are ex-pats, hang out with other ex-pats, and pad their bank accounts for a few years before leaving, either to return home and raise a family (younger people) or to retire, often slightly earlier than most of us will with bigger bank accounts.

I'm not convinced that this system makes for a "sustainable" urban economy.

Matt L.

Yes, Dubai and other countries in the Middle East have some laws that strike us westerners as harsh. But ultimately you are a guest -- typically the process for getting into a Middle Eastern country is much more closed and makes that "guest" status pretty clear. Perhaps the worst thing they could do would be to claim tolerance before they're ready to see it through.

Lots of countries limit the rights of non-citizens and reserve the right to deport them for small "false steps". For example, non-citizens can get kicked out of the U.S. for offences as minor as failing to file a change of address form: http://www.nolo.com/article.cfm/objectId/46E25CCD-3076-4CAE-B8909FA9BFF73FEA/

hayden fisher

I have a good friend, of ME descent, who moved to and lived in Dubai for several years before returning to the US...because... well...why don't we let Bruce Springsteen tell the story:

What is this land of America, so many travel there
I'm going now while I'm still young, my darling meet me there
Wish me luck my lovely, I'll send for you when I can
And we'll make our home in the American land

Over there all the woman wear silk and satin to their knees*
And children dear, the sweets, I hear, are growing on the trees*
Gold comes rushing out the river straight into your hands*
If you make your home in the American land*

There's diamonds in the sidewalks, there's gutters lined in song
Dear I hear that beer flows through the faucets all night long
There's treasure for the taking, for any hard working man
Who will make his home in the American land

I docked at Ellis Island in a city of light and spire
I wandered to the valley of red-hot steel and fire****
We made the steel that built the cities with the sweat of our two hands
And I made my home in the American land

There's diamonds in the sidewalk, there's gutters lined in song
Dear I hear that beer flows through the faucets all night long
There's treasure for the taking, for any hard working man
Who will make his home in the American land

The McNicholas, the Posalski's, the Smiths, Zerillis too**
The Blacks, the Irish, the Italians, the Germans and the Jews
The Puerto Ricans, illegals, the Asians, Arabs miles from home***-*****
Come across the water with a fire down below******

They died building the railroads, worked to bones and skin
They died in the fields and factories, names scattered in the wind
They died to get here a hundred years ago, they're dyin' now
The hands that built the country we're all trying to keep down

There's diamonds in the sidewalk, there's gutters lined in song
Dear I hear that beer flows through the faucets all night long
There's treasure for the taking, for any hard working man
Who will make his home in the American land
Who will make his home in the American land
Who will make his home in the American land

Robert

To: Wendy

Your story is proving my point in my first post. Your friend is there for the money period, not the culture or for the diversity. After his contract is up and he leaves Dubai someone else will gladly take his place. I have no doubt people around the world are lining up for work in Dubai.

In America a historically strong dollar is certainly one of the factors drawing immigrants to America. Immigrants come to America and work and when their saving in dollars is converted to their own currency when they head home to their previous country they can live extremely well. However, the dollar is declining rapidly and will probably based on my readings fall to at least .40-.52 from .73 on the dollar index. When this happens immigration to America especially educated immigrants with in demand skills will slow dramatically.

hayden fisher

Robert, I agree about Dubai but disagree about America. People come to America to build a life, not just earn a wage. Even today, and more so probably, we forget how much discrimination existed during earlier years, American remains the one place where anyone living anywhere can come and build a life. We enjoy a living and breathing culture that we sometimes love to hate but always return to love. There's an ebb and flow of course and sometimes it seems that we're losing our competitive advantages and gritty roots. But just when it seems that might be about to happen, BOOM, along comes the next wave.

The game-changing enterprise always comes out of America. You can't incubate it. You can't social-plan it. You can't 'track' and manufacture it via talented and gifted programs. It often comes out of the least expected places. "It" happens in America because America is the only place where anything can truly be born and accepted. Where vision and faith can truly be rewarded and second chances afforded. There's no place else like it in the world.

Michael Skye

My thoughts...

Free Enterprise Zones naturally engender a spirit of tolerance, and as FEZs create prosperity, they will be modelled by others... in time. Sustainable? As long as certain levels of peace and free trade are protected.

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