Episode 778: What the Falcon's Up With Qatar?

Jun 16, 2017
Originally published on June 19, 2017 2:24 pm

Eighty years ago, Qatar's primary industry was pearl-diving. Today, the tiny Persian Gulf nation is the richest country in the world per capita. It's also in a lot of trouble.

Saudi Arabia and several nearby countries have blockaded tiny Qatar, cut off all trade, closed the border. It seemed like overnight, Qatar went from being on top of the world to being a regional pariah.

So we wondered: What's going on?

We delve into the region's politics, economics, and culture to trace the roots of the crisis. The tensions between Qatar and its neighbors have been simmering for years. It's a bit like a family drama, little brother poking a thumb in the eye of a big brother. Except these brothers also control a tremendous amount of the world's energy resources and two important U.S. military bases.

Normally, when these 'brother monarchies' might squabble, other countries, like the U.S. might intervene and smooth things over. But this time, that's not happening.

On today's show, a tale of outsize ambition, kidnapped royalty, the explanation behind the Saudi Arabian orb, and a giant air conditioner that fueled years of growth.

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ROBERT SMITH, HOST:

You would have a hard time finding a country that has been luckier over the last several decades than the Middle East state of Qatar.

KENNY MALONE, HOST:

Cutter (ph).

SMITH: Cutter (ph).

MALONE: Kuh-tar (ph). We - everyone we talked to for this story said it, like, a little bit differently.

SMITH: And we might do so throughout the episode.

MALONE: But here's what we know for certain. Qatar is a country the size of Connecticut. It's, like, a little thumb-shaped peninsula, shares a border with Saudi Arabia. About 2.2 million people live there, and almost 90 percent of them are foreign workers.

SMITH: Qatar has oil and gas. Per capita, it is the richest country in the world. And for such a tiny place, it has this outsized status. There is a big U.S. Air Force base there. It's going to host the World Cup in a few years.

MALONE: By many measures, Qatar is living the dream - or at least it was until last week.

SMITH: Last week, Qatar's neighbor, Saudi Arabia, said it was going to close the border. That's Qatar's only border. They told the Qataris, you can't use our airspace; you can't move ships through our territorial waters.

MALONE: And other Gulf nations joined in. It was a modern-day blockade. And all of a sudden, tiny Qatar, which doesn't grow its own food - it imports everything. Qatar was on its own.

SMITH: People panicked. Nour Barakat lives in Doha, the capital of Qatar.

MALONE: She's a doctor there. And she says when she went to the grocery store that day, it was bedlam. Cars were parked on the sidewalks. There was a sea of people inside.

NOUR BARAKAT: (Sighing) It has to be hundreds. People are standing in very long lines, to the point where, even if you want to get to an aisle, you can't because there are people standing there waiting in line in the aisle. I definitely started thinking, should I be scared?

MALONE: Because so much of Qatar's food comes from Saudi Arabia, nobody was sure if there would be food tomorrow.

BARAKAT: People were really just, like, grabbing everything, like, even things that people probably wouldn't normally buy. Like, for example, there was this one lady who clearly grabbed everything on the dairy shelf because she had every single type of yogurt - flavored, non-flavored, low fat, full fat. Just - it was crazy. It was like - it was as if we're going to war, you know.

SMITH: Nour says she had to stand in the checkout line for two hours.

BARAKAT: The funny thing is the time where we're supposed to break our fast...

MALONE: The daily fast for the holy month of Ramadan.

BARAKAT: ...We were still standing in line. And people just started opening food in the supermarket and just giving out food to each other (laughter).

MALONE: Nour says somebody opened some dates, handed those around - and some yogurt, handed that around.

SMITH: Now, rich countries take for granted in this world that their money will buy everything they could possibly need. So what went so wrong in Qatar so quickly?

MALONE: How does a country go from being on the top of the world to becoming a pariah, seemingly overnight?

(SOUNDBITE OF SONG, "TALK TO ME")

JOHN MCMASTER, LOUIS EDWARDS, MYRA BOYLE AND HENRY PARSLEY: (Singing) I wanted to know you to feel alive.

MALONE: Hello, and welcome to PLANET MONEY. I'm Kenny Malone.

SMITH: And I'm Robert Smith. Today on the show, how the search for power and money set Qatar on a collision course with its neighbors.

MALONE: It's a story of buried treasure, kidnapping and a glowing Saudi Arabian orb.

SMITH: Don't forget the falcons.

MALONE: Oh, yes, the falcons.

(SOUNDBITE OF JOHN MCMASTER, LOUIS EDWARDS, MYRA BOYLE AND HENRY PARSLEY SONG, "TALK TO ME")

SMITH: There are two parts to the story of the Qatar blockade. There is the spectacularly strange events of the last three weeks.

MALONE: And then there is the even stranger stuff that came before that. We're going to tell both. But we are going to start back in time.

SMITH: In a swimming pool in the Middle East with an American dude.

JIM KRANE: Our swimming pool where I used to go swimming after work was artificially chilled.

SMITH: (Laughter) I've never heard of that before.

KRANE: So - right. So this is normal in the Gulf because it's so hot.

MALONE: Jim Krane is at Rice University, an expert on Qatar.

SMITH: Back a decade ago, Jim was living in the region, floating in his refrigerated waters. And everything was cool, both for Jim and for Qatar and for their neighbors. They were like a family.

KRANE: They refer to each other as brothers.

MALONE: The brother monarchies. The oldest brother and the biggest is Saudi Arabia. Saudi sets the rules, dominates everything in the region, has the most oil, has the most money.

SMITH: And the younger brothers are - you've heard of these - Kuwait, Bahrain, the United Arab Emirates, Oman and little Qatar.

MALONE: Qatar was a late bloomer. While Saudi Arabia was discovering oil 80 years ago, Qatar was a rickety port on the Persian Gulf. The economy was built on diving for pearls.

SMITH: A pearl-based economy is fine. But what they really wanted was oil, lots of oil. They had some oil, but they wanted Saudi Arabia levels of oil, so they kept drilling and drilling for it.

MALONE: In 1971, the Shell company was drilling off the coast in Qatar in the Persian Gulf, and it starts to get signs that it is sitting on top of a huge find...

SMITH: Oh, yeah.

MALONE: ...Something big. But they drill, and they drill - no oil. No oil, just a bunch of natural gas.

KRANE: So it's a huge disappointment. So you know - I mean, gas is - you know, it's got a much lower energy density than oil. And, you know, it's hard to store it.

SMITH: Well, yeah. It's hard to ship it out in barrels.

MALONE: Or balloons.

KRANE: Right. So you basically have to have a pipeline from the wellhead all the way to the burner tip.

SMITH: Bottom line - you can't put natural gas on a big ship and take it to the United States or Japan, at least you couldn't back then.

MALONE: And so Qatar was stuck going door to door to its brother states saying - hey, you know, we've got some natural gas. We can build you a pipeline.

SMITH: And they were like, (sighing) fine. We will take your stupid gas, but we're not going to pay you very much money for it.

MALONE: For years, Qatar didn't know what to do with all of this natural gas. The country was rich in something it could barely sell.

SMITH: They were eventually saved by a nice bit of luck in the form of a technological breakthrough, liquefied natural gas. Apparently, if you build a big enough plant, you can take all of that natural gas, make it super cold, liquefy it and put it on a ship - take it wherever you want.

MALONE: Qatar essentially built the world's largest air conditioner, and Jim Krane went to see it. Apparently, everyone did.

KRANE: You know, it looks like the most complicated, bewilderingly complex massive bowl of chrome spaghetti, you know, little flares here and there, like spaghetti flambe.

MALONE: When this liquefied natural gas plant opens, it is a huge deal for Qatar. Suddenly, it can do whatever it wants.

SMITH: Yeah, think about it this way - Saudi Arabia, Bahrain, all the other oil states were basically stuck together. They were in the family business of crude oil. And their fortunes were tied together, rising and falling with OPEC and the price of crude oil.

MALONE: But little brother Qatar quickly became the largest exporter of natural gas in the world. And in the last 10 years, that was a pretty sweet place to be. All around the globe, countries were converting their electrical plants and their factories from coal and oil to natural gas.

SMITH: Within a generation, Qatar isn't just rich; it is stupid rich.

MALONE: And what, of course, does a little brother do with his newfound wealth and power?

SMITH: What any little brother would do - Qatar rubs it in the face of its older brothers. Qatar decides it is going to spend its money becoming a big shot in the world, no longer just a nubbin on the backside of Saudi Arabia. No, Qatar is going to somebody.

MALONE: They look around at other big countries with lots of international influence, and they see a lot of them have big, international news channels - CNN, BBC. Russia has RT. So Qatar start their own, Al-Jazeera.

(SOUNDBITE OF AL-JAZEERA ENGLISH BROADCAST)

SHIULIE GHOSH: Welcome to the world news from Al-Jazeera and the very first program live from out Doha news headquarters here in the heart of the Middle East.

MALONE: For the brother monarchies, Al-Jazeera was almost immediately an annoyance because, suddenly, you have a neighbor with a news network snooping through your trash, digging up your dirt, reporting on your scandals.

SMITH: And this whole problem really came to a head during the Arab Spring, which, you may remember, there were all these sort of grassroots people's movements in Tunisia and Libya and Egypt. And Al-Jazeera really made its name being there on the ground with the revolutionaries, featuring them and, you know, sometimes glorifying them.

MALONE: And when you're Saudi Arabia or another monarchy sitting and watching this, this is not good for you. You are worried that you may be next.

KRANE: You know, here is one of their brethren with this news channel that's kind of egging on the revolution, you know. So they - you know, of course they're pretty upset about it.

SMITH: Oh, and Qatar was just getting started. For so many years, their foreign policy had been essentially what their other brother states thought. They went along with the crowd. But now they decided to forge their own way in the world, and they had this radical concept for foreign policy in the Middle East. Qatar was going to be friends with everyone.

MALONE: Qatar starts trying to broker peace deals. They're willing to talk to Israel and to Hamas. They're supporting the Muslim Brotherhood, and they become friendly with Iran.

SMITH: For Qatar, this makes total sense. Iran shares the rights to that big, natural gas field. They are the country right across the Persian Gulf from them, and they have these shared economic interests.

MALONE: For Saudi Arabia, this is a nightmare. Saudi Arabia hates Iran, and the feeling is mutual. There's the religious rift. But also, Saudi Arabia and Iran are the two big dogs in the region, barking at each other over everything.

SMITH: And Qatar doesn't seem to care. Their every move seems to say, we do not need our family anymore. We have money. We have prestige. We have power. We have a TV network. A confrontation was coming, and everyone knew it.

MALONE: And then in just the last few months, three things happened, three utterly bizarre things that seemed to have triggered the blockade we are seeing today against Qatar.

SMITH: The Orb...

MALONE: The hack...

SMITH: And the falcon. The orb, the hack and the falcon.

MALONE: The orb, the hack and the falcon.

SMITH: (In unison) The orb, the hack and the falcon.

MALONE: (In unison) The orb, the hack and the falcon.

No. 1...

SMITH: I think everyone remembers, the orb.

MALONE: We are about to play for you something. And it is going to sound like we've added music to this, but I swear this is actually the music playing during this moment.

(SOUNDBITE OF MUSIC)

SMITH: You have almost certainly seen a picture of this orb moment. Our president, Donald Trump, is visiting Saudi Arabia's shiny new Global Center for Combating Extremist Ideology.

MALONE: To inaugurate this new place, the president posed with the king of Saudi Arabia, the president of Egypt, and a giant, glowing orb.

(SOUNDBITE OF MUSIC)

SMITH: They laid their hands on the orb.

MALONE: Everybody applauded the glowing orb. And with that, the GCCEI...

SMITH: GCCEI was...

MALONE: ...Was running - up and running.

This really was a big moment because this event was all about a giant command center that looks like it's like NASA or something. But it's about fighting terrorism. It's a sign that Saudi Arabia is taking terrorism seriously and spending big to fight it.

SMITH: To be fair, the orb itself was not signaling trouble for Qatar. It was the fact that Trump, with his very first overseas trip as president, chose to visit Saudi Arabia, a kind of new-sheriff-in-town move, as if to say, you know, maybe those old presidents didn't take sides over here. But I, Donald Trump, am standing with the Saudis, not with Qatar.

MALONE: Event No. 2, the hack.

SMITH: Three days after the orb - by the way, that is how we are measuring time now, after the orb....

MALONE: All time.

SMITH: ...A very strange article showed up on the website for Qatar's national news outlet.

MALONE: This mysterious article claimed that the emir of Qatar gave a speech saying some pretty incendiary things - Trump won't last as president; Israel's a great friend; Qatar is still friendly with Iran.

SMITH: Fake, fake news...

MALONE: Fake news...

SMITH: ...Did not happen.

MALONE: ...Real fake news.

SMITH: The news website had been hacked, and the story was planted. But it didn't matter because the story spread around the region anyway.

MALONE: Which brings us to event No. 3, the falcon.

SMITH: This is the most complicated one because it involves kidnapping and ransoms and falcons.

MALONE: And we're going to lean heavily on the Financial Times here because they've done some of the most amazing reporting on this. And according to that reporting, this story starts in December of 2015. A Qatari hunting party was in Iraq. It was about two dozen people.

SMITH: They were falconers, meaning they travel with falcons. They train the falcons. They take the falcons hunting and, I assume, stand around and drink tea while the falcons fly around, and they wait for them.

MALONE: The party of falconers was kidnapped by an Iranian-backed militia and then held for ransom.

SMITH: And in that band of falconers were members of the Qatari royal family.

NADER KABBANI: They were important people, so there was a big issue.

MALONE: Nader Kabbani lives in Qatar. He's with the Brookings Institution in Doha.

Would it be like Prince William being kidnapped in England?

KABBANI: No, I don't think.

MALONE: Not quite that high.

KABBANI: But anyway, Qatar chose to deal with the situation, you know, through negotiation.

SMITH: Negotiation.

MALONE: A lot of countries in Qatar's position would say, no, you are a terrorist group. There is no chance we're going to negotiate with you on this.

SMITH: But it was the royal family, and this was Qatar, who has made it their business to work with all kinds of unsavory groups. And they do have a lot of money there.

MALONE: According to the Financial Times, Qatar paid up to $1 billion to release the hostages. And according to the Financial Times' reporting, some of that money may have made its way to an al-Qaida affiliate. Some may have gone to Iranian security officials.

KABBANI: You know, the Saudis and the Iraqis try their best to kind of push the narrative of Qatar's alleged support of terrorism, and this kind of fell within that narrative.

MALONE: Right.

SMITH: And in the eyes of Saudi Arabia...

MALONE: ...It was a problem, a big problem.

SMITH: Qatar funding terrorism, funding Iran a billion dollars?

MALONE: Qatar admitted to the Financial Times that, yes, there was some money paid. But it claimed that it wasn't as much as people thought, and it said it hadn't gone to support terrorist groups. But it didn't matter. The blockade was on.

(SOUNDBITE OF TV SHOW, "INSIDE STORY")

JANE DUTTON: On Monday, Saudi Arabia, Bahrain and the United Arab Emirates ordered Qatari nationals to leave their countries within 14 days.

MALONE: So here's where we are today, two weeks into this blockade. Saudi Arabia, Bahrain, the United Arab Emirates and Egypt have all severed ties with Qatar.

SMITH: They won't allow Qatari planes to fly over their airspace. They won't allow Qatari ships to dock, although some are getting through.

MALONE: Saudi Arabia has shut down the local Al-Jazeera office. And of course, they've closed the border, the only land border that Qatar has.

SMITH: And Saudi Arabia is asking Qatari citizens to leave the country, which would mean people will have to leave behind perhaps jobs, family members, apartments, their stuff.

MALONE: This is usually the moment when a powerful country with interests in the region would try to step in, you know, like - you know, a country like the United States.

SMITH: And the United States has military bases (laughter) in both of these countries, in Saudi Arabia and in Qatar.

MALONE: But it's been a little tricky to tell exactly where the U.S. stands on this. The message has been, at best, murky.

SMITH: Yeah, the president tweeted his support, at first, for the blockade. He said, quote, "perhaps this will be the beginning of the end to the horror of terrorism."

MALONE: But then his own secretary of state goes on TV, and he says the blockade is bad. It is hurting people. It's separating families, and it hurts the U.S. military base.

SMITH: And just to make everything slightly more confusing, just this week, as we were reporting this story, the United States announced that it plans to sell $12 billion worth of fighter jets to Qatar. It is as if they took the glowing orb, shook it, looked down into it and it said - I don't know - reply hazy; try again later.

MALONE: It's all very confusing at the moment. The one thing that we can say with some certainty is we talked to a lot of people on the ground in Qatar, and it sounds like the supermarket situation has gotten much better. Qatar has found some new sources of food. They're now getting yogurt and milk from Turkey, vegetables from Iran - from Iran.

The blockade was partially about Qatar being close to Iran, and it may have made Qatar even closer to Iran.

(SOUNDBITE OF MUSIC)

SMITH: Hey, if you have a better pronunciation of Qatar, we would love to hear it. You know, Freakonomics is actually taking all of those suggestions for us. Thanks to them. For the other comments, planetmoney@npr.org, Twitter, Facebook - we are on all the things.

MALONE: Today's show was produced by Nick Fountain. A very special thanks Randa Slim of the Middle East Institute - she talked us through so much of this - and also to Erika Solomon with the Financial Times. They've been doing fascinating reporting on this stuff.

SMITH: And now that you're finished with PLANET MONEY, may we recommend Invisibilia? They have a new season out. And in it, they are looking at this question - how is it that two people can look at the exact same thing and see something completely different? You can hear Invisibilia at npr.org/podcasts or on the NPR One app. I'm Robert Smith.

MALONE: And I'm Kenny Malone. Thank you for listening.

MALONE: Falconry - this is a popular thing?

KABBANI: This is a big thing.

SMITH: This is so weird. Like, everybody's got a falcon?

MALONE: No, it's not, like, everybody. What it is is it's common enough that it's sort of like, you wouldn't look twice at it, like someone walking a puppy for example. But it is mostly for the super-rich. So let's say, like, it's like having a puppy but like a really expensive, purebred, hunting puppy.

Have you done it personally? Have you gone falcon hunting?

KABBANI: I have not done it personally. I've gone to the falcon souk.

MALONE: The falcon souk?

KABBANI: To the market.

MALONE: Oh, you've gone the falcon store.

KABBANI: Yeah. So the falcon store - they'll let you hold the falcon or at least, you know, put this thing over your arm.

MALONE: And was it as fun as petting a puppy?

KABBANI: Yeh (ph) - no.

(LAUGHTER) Transcript provided by NPR, Copyright NPR.