PRODUCING CRISIS/SURVIVING CRISIS: POWER, CAPITAL, AND …

PRODUCINGCRISIS/SURVIVINGCRISIS:POWER,CAPITAL,ANDTHESOCIALSTRUCTUREOF

ACCUMULATIONINTHEHASHEMITEKINGDOMOFJORDAN

by

ColinPowers

AdissertationsubmittedtoJohnsHopkinsUniversityinconformitywiththerequirements

forthedegreeofDoctorofPhilosophy

Baltimore,Maryland

April2020

©2020ColinPowers

Allrightsreserved

ii

Abstract

Thismonographwillattempttoresolveatwo-partproblematique:(1)whyisitthat

Jordaniancapitalismcontinuouslyengendersdevelopmentalandsocialfailuresand(2)howisit

thatthiscapitalismenduresinspiteofengenderingsuchfailures.

Inansweringthefirstofthesequestions,Iwillemphasizestructuralpropertiesendowed

bybothhistoryandJordan’sglobalperipherality/externaldependencybeforeunwindingthe

moreimmediatecausalandconstitutiveeffectsintroducedbycontemporaryeconomic

governance,theprofitseekingbehaviorofanelitefractionofthecapitalistclass,andprocesses

relatedtoauthoritarianrenewal.Iwillattributetheenduranceofthiscapitalism,meanwhile,toa

constellationofintegratedinstitutionalbulwarksthatIwillrefertoasJordan’ssocialstructureof

accumulation.Consolidatinganelite-dominatedformofaccumulationandcontrol,Iwillshow

howthestabilityrealizedthroughtheseinstitutionalbulwarksbothrequiresandimplieslong-

termunderdevelopmentandhighlevelsofsocialtension.HavingdemonstratedhowthisJanus-

facedphenomenonfunctionstogeneratecrisisconditionswithoutultimatelyprecipitatingeither

thecollapseorevolutionofthewiderpoliticaleconomy,itismyhopethattheparadoxof

Jordaniancapitalism—aformationatonceresilientandontologicallyboundforfailure—willbe

atleastpartiallyresolved.Inthismonograph’sconclusion,Iwillusethethickdescriptionatthe

heartofthiscasestudyinconjunctionwithabductivereasoningsotoderivegeneralizable

theoreticalknowledgeasregardsactuallyexistingneoliberalismalongtheglobalperiphery.

iii

ForLeila,myparents,andBobby

iv

Contents

ChapterOne:Anintroductionto(Jordanian)capitalisminthe21stcentury………………………………………………….pp.1-45

ChapterTwo:Socialstructureofaccumulationtheoryandtheroadhead…………………………………………………….pp.46-68

SectionOne

ChapterThree:Apreamble:JordanbeforetheMandate,JordanduringtheMandate…………………….……………...pp.70-96

ChapterFour:IndependentJordan’sfirstsocialstructureofaccumulation:1946-1973………………………………pp.97-133

ChapterFive:Oil,inducedstaterentierism,andJordan’ssocialstructureofaccumulation:1973-1986……..pp.134-169

SectionTwo

ChapterSix:Politics,policymaking,andtheinstitutionalizationofneoliberalcapitalism.………………………..pp.171-204

ChapterSeven:Themakingandmanagementofthemarket:Thestate/palaceintheeconomy…………………pp.205-255

ChapterEight:Institutionalizingoligarchy:TheJordanianformofmarketcompetition……………………………pp.256-293

ChapterNine:SocialcontrolunderAbdullah…………………………………………………………………………………………..pp.294-318

ChapterTen:Peripherality,dependencyandtheexternalarticulationofJordaniancapitalism…………………pp.319-370

ChapterEleven:Legitimatingneoliberalism:inward/outwardfacingideologyandtheJordanianSSA……….pp.371-398

ChapterTwelve:Conclusions………………………………………………………………………………………………………………….pp.399-417

Index1………………………………………………………………………………………………………………………………………………….pp.418-419

WorksCited…………………………………………………………………………………………………………………………………………..pp.420-432

v

ListofTablesGrossFixedCapitalFormationbyKindofEconomicActivity(2008-2016):4JobCreation(SectorandActivity):14RegisteredExpatriateWorkersbyEconomicActivity:17MedianandMeanRealWagesinJordan(2010and2016):30CentralGovernmentBudgets(1924-1944):86SourcesofDomesticRevenues(1953-1966):113AllocationofStateExpenditures(1953-1966):113StructureofJordanianImportsandExports(1967-1973):125SourcesofGovernmentRevenues(1953-1966):126Jordan’sForeignPatrons(1964-1973):127SourcesofDomesticRevenues(1974-1989):142StructureofJordanianImportsandExports(1974-1989):156-157SectoralShareofNationalGDP(1974-1989):162ApplicantsandAppointeestotheJordanianCivilService(1990-2017):212KADDBJointVentures(2008):249ForeignPopulationResidinginJordanbyCountryofNationality(2004,2015):314SourcesofJordanianODA(2015-2016):334Jordan’sArrangementswiththeIMF(1989-2016):338AllocationsofBilateralOfficialDevelopmentAssistance(2015-2016):339ExternalTradebyCommodityGroups(2018):352-354Top10ForeignCompaniesInvestinginJordan(2003-2015):355ForeignDirectInvestmentFlowsbyCountry(2005-2017):356ForeignOwnershipofAmmanStockExchange(2017-2019):358InvestorsOwningMorethan1%EquityinJordan’sPubliclyListedFirms(2019):360-364

vi

ListofFigures Gross Fixed Capital Formation (% of GDP): 5 National Savings (% of GDP): 5 Total Factor Productivity (Constant National Prices): 6 Output per Workers (2011 USD): 6 Growth of Labor Productivity per Person Employed: 7 Jordan Trade Performance (1985-2017): 8 Jordan’s Current Account and Trade Balance under King Abdullah: 8 Terms of Trade (1997-2017): 9 Ranking of Jordanian Export Complexity (1964-2017): 9 Manufacturing Value Added Per Capita (1990-2016): 10 Share of Medium and High-Tech Products in Manufactured Exports (1990-2016): 10 Jordan v. Comparator Countries, Share of Medium and High-Tech Products in Manufactured Exports (1990-2016): 11 Resident Patent Applications: 11 Distribution of Work Permits by Sector, Sex, and Nationality: 16 National Unemployment Rate: 19 Education Levels of New Market Entrants (1960-2010): 21 The Unemployment by Education Levels (2000-2010): 21 The Jordanian Employed (2013-2017): 22 Labor Force Participation Rates (1990-2018): 26 Employment to Population Ratio (2000-2018): 26 Employment Structure in Private-Wage Employment by Firm Size (2010): 32 British Subsidy to Mandate Transjordan (1921-1944): 89 Jordan Trade Performance (1954-1966): 125 Domestic and International Borrowing (1974-1989): 143 State Expenditures (1974-1989): 144 Foreign Trade (1974-1989): 158 Sources of Government Receipts (1974-1989): 158 Asset of Licensed Commercial Banks (1976-1990): 161 GDP Per Capita Growth (1982-1991): 165 Share of Public Sector in Total Employment under King Abdullah (2000-2016): 209 Public Sector Jobs Created (2007-2017): 209 Average Annual Household Expenditures on Health Services (2008-2017): 218 Tax Revenues (2005-2017): 219 Treasury Bills and Bond Issues to GDP Ratio (2001-2016): 223 Overall FDI Restrictiveness Index: 235 QIZ Exports (2000-2011): 239 QIZ vs. FTA, Exports (2010-2011): 239 QIZ Job Creation and Export Sophistication: 244 Total Assets of Licensed Commercial Banks (2000-2018): 272 Aggregate Sectoral Income (2017): 273 Share of Aggregate Sector Market Capitalization and Sector Annual Income (2017, 2019): 277-290 Work Permit Holders by Nationalities (2004-2014): 314 Jordan’s Official Development Assistance (1990-2009): 333 Jordan’s Annual Official Development Assistance (2010-2017): 336 US Aid Budget Allocations (2019): 340 Jordanian Trade Performance (1985-2017): 340 Jordan’s Current Account and Trade Balance under King Abdullah (2000-2017): 341 Terms of Trade (1997-2017): 345 Jordan’s Economic Complexity (1964-2017): 346 Jordan’s Export Basket (2017): 346

vii

Jordan’s Export Basket, Product Composition (2017): 347 Value-Add of Domestic Manufactures (1990-2016): 348 ICT Exports as Percentage of Total Exports (Jordan v. Comparator Countries, 2000-2017): 349 Jordan’s Export Complexity Index Score and Rank (1964-2014): 352 Foreign Ownership of Amman Stock Exchange (2017-2019): 359 Education Levels of the Jordanian Workforce: Home v. the Diaspora (2010): 368 Workers’ Remittances under King Abdullah (2000-2017): 370

1

CHAPTERONE

Anintroductionto(Jordanian)capitalisminthe21stcentury

If not sui generis, Jordanian capitalism is undoubtedly peculiar, as is most obviously and

saliently evinced through its relationship with crisis.

On the one hand, it can be shown that crisis, broadly defined, constitutes both a necessary input

and an inevitable output of capital accumulation in Jordan, an odd phenomenon in and of itself. Despite

this being so and despite the economy’s loitering in a state of terminal distress, moreover, it can also be

shown that this formation somehow demonstrates both resilience and immutability as well. An

impossibility of sorts, then, Jordanian capitalism seems to endogenously generate then stubbornly

persist within the very conditions meant to trigger either its demise or its evolution.1

Onecouldbeforgivenforfindingthisallabitdisorienting.Thisisthecountryofaplucky,

reformistKing,afterall,ofamonarchwhoconfidentlytraverseswesterncapitalsincantingtales

ofarisingSiliconWadi.Andyet,theslightestscrutinywouldbesufficienttorevealKing

1 Itisindisputable,ofcourse,thatthevagariesofJordan’sexternalenvironmentintensifythiscapitalism’smany

failures,astheeffectsoftheSyrianrefugeeinfluxwellattests.Nevertheless,asitcanandwillbedemonstratedthatexogenousshocksonlyextenuateandcompoundtendenciesinternaltotheeconomicformation—asfailureandunderdevelopmentarethereforestructural,endogenous,andevenontologicalpropertiesoftheJordanianeconomyitself—,myconceptualizationismeanttoarticulatethatmarketfailuresareofthiscapitalism’sownmakinginboththefirstandfinalinstance.

2

Abdullah’sstoriesofapost-modernprosperity2justbeyondthehorizonaslittlemorethan

delusionandmarketing-speak.Asurveyofcriticalnationalaggregates,forinstance,evidencesan

economymarredbydecliningratesofsavings,investmentandgrossfixedcapitalformation

(GFCF).IfGDPgrowthfiguresinitiallysuggestaslightlyrosieroutlook,aquickpeakunderthat

hoodestablishesthattheseyieldsarebornealmostexclusivelyofdemographicshifts,the

contingentinflowsofIraqicapital,andpetrodollarrecycling(boundforspeculationinthebuilt

environment).Totheextent,then,thateconomicexpansionisnowwhollydisarticulatedfrom

laborproductivityandtotalfactorproductivity—eachofwhichhavestagnatedorrecededacross

thepasttwentyyears3—,oneoughttakelittlesolacefromwhatgainsare,onoccasion,reflected

inmetricslikethegrossdomesticproduct.

Whatismore,thoughtheopeningoftheJordanianeconomywassoldthroughconstant

referencetotheteleologiesofcomparativeadvantagetheory—topromisesofexport-led

development,technologicaltransfers,knowledgeupgrades,efficiencygains,andhealthy

specialization—,itsrealitieshaverevealedthisassomethingofalongcon.Tragicallypredictable

thoughsuchanoutcomemaybe,itneverthelessbearsrepeatinganddetailingthattwentyyears

2 Isay“post-modern”astheKingetalhavepromisedaprosperitywithoutindustrializationoranyofthe

traditionalenginesofeconomiccatch-up.Emphasizingtechandtheserviceeconomy,theyarticulatesomethingresemblingtheDubaimodel(thoughwithouttheabundantcapital).

3 JordanStrategyForum,“OntheimportanceoflaborproductivityinJordan:whereisthechallenge?”,Report

(2018),p.9. ThisdeclineoccurreddespiteAbdullah’stenurehavingcoincidedwiththeintroductionofanumberofgame-

changinggeneralpurposetechnologies,ofwhichdigitalcommunicationsrepresentsbutthemostobviousexample.

Tooffersomesenseofthegravityoftheseproductivitydeclines,Jordanranked116thintheworldinlabor

productivitybetween2010and2018.

3

oftradeliberalizationhave,inactuality,producedanimportbasketgrowinginsizeandvalueand

anexportbasketincreasinglyconcentratedinlowvaluegarmentmanufacturesandhighly

volatile,low-pricedcommoditiessuchaspotashandphosphates.Indicativeofthewider

industrialdecayprecipitatedbytheconfluenceoftrade4,investment,andindustrialpolicy,the

valueaddedthroughJordan’sdomesticmanufactures(MVA)isfallingeverfurtherbehind

relevantcomparatorswitheachpassingyear,andhighandmedium-technologyexportsnow

constituteasmallerpercentageofGDP(andoftotalexports)thantheydidin1990.Lestone

assumethesearebuttemporaryhiccupswithinanotherwisepromisingevolution,gross

expendituresintoresearchanddevelopment(R&D)suggestthatindustrialregressionislikelyto

onlyaccelerateaswemoveforward.Compoundedbydeficientoutlaysoneducation,thedistance

betweenJordanandtheglobaltechnologicalfrontiercanthereforebeexpectedtowidenwith

time,deepeningthemalaisehithertodescribed.5Inviewofeverythingfromthecountry’s

decliningtermsoftradeandsubstandardratesofinnovationtothemanyissuesbegottenofits

prematuredeindustrialization,Jordan’sageofperditioninthelowermiddleincometrapmost

certainlyseemsuponus.

4 Itisworthnotingthattheimpositionofinvasiveintellectualpropertyregulations—animpositionthatispartand

parcelofthesetradepolicies—havealsoundercutthosefewtechnologically-intensive,forward-lookingindustriesthathaddemonstratedpotentialpriortoAbdullah’sascension(suchaspharmaceuticals).TheseregulationswereintroducedfirstfollowingJordan’saccessiontotheWTO,andmoreextensivelyfollowingJordan’ssigningoffree-tradeagreements(FTAs)withtheUnitedStatesandtheEuropeanUnion.

5 PerUNESCO,Jordan’sgrossexpenditureintoR&D(asapercentageofGDP)sitsat.71asof2016.Asapointof

comparison,SouthKorea,thegloballeaderonthismetric,spends4.3%ofGDPonR&D.EconomiesthatJordansurpassedorequaledintermsofdevelopmentasofthe1980s(suchasIreland,Estonia,Hungary,andMalaysia)allspendintheareaof1.5-1.8%.

Asforexpendituresoneducation,WorldBankestimatesputJordanat3.59%GDPasof2017.Bywayofcomparison,theaverageexpenditurepercentageforlowermiddleincomecountriesisapproximately4.3-4.5%GDPasofthetimeofwriting;OECDmembersaveraged5.2%asof2013.

4

GrossFixedCapitalFormationbyKindofEconomicActivity(CurrentPrices)

(Units:MillionJD)

2008 2009 2010 2011 2012 2013 2014 2015 2016 Agr., For., and Fishing

59 50 41 38 45 54 62 61 100

Mining and Quarrying

37 148 325 97 16 85 65 84 205

Manufacturing* 380 329 360 811 328 409 446 412 415 Electricity, Gas, etc.

236 105 298 267 101 264 181 282 178

Water Supply, Sewage, etc.

98 418 880 824 810 147 273 240 203

Construction 98 127 102 120 98 110 116 102 69 Wholesale and Retail Trade

49 45 56 67 86 89 88 147 151

Transportation and storage

401 159 130 72 128 79 92 152 216

Accommodation and Food services

36 36 36 77 48 38 42 35 56

Info and Communications

139 124 79 95 106 145 402 335 286

Financial and Insurance Activities

137 132 128 138 135 159 206 195 154

Real Estate Activities

1914 1987 1885 1850 2336 2400 2157 2177 1905

Prof, Scientific, and Technical Activities

5 3 5 4 2 4 5 7 8

Admin and Support service activities

7 7 4 6 5 1 0 2 20

Public Admin and defense

574 736 627 483 342 548 632 661 722

Education 125 129 104 101 82 93 171 185 141 Human Health and Social Work activities

120 131 113 142 82 135 128 121 112

Arts, entertainment, rec

0 1 5 2 3 1 1 3 2

Other Services 3 2 2 4 8 6 2 11 4 Household activities

0 0 0 0 0 0 0 0 0

Activities of Extraterritorial Organizations

0 0 0 0 0 0 0 0 0

*Manufacturesarewhollydominatedbylowsophisticationgarments. DataprovidedbytheJordanianDepartmentofStatistics(MinistryofPlanningandInternationalCooperation)

5

DataprovidedbytheWorldBank

DatafromWorldBank

6

DataProvidedbyPennWorldTables

DataprovidedbytheILO

7

*ChartsprovidedbyJordanStrategyForum,“OntheimportanceoflaborproductivityinJordan:whereisthechallenge?”,Report(2018),p.8-9

8

DataprovidedbytheCentralBankofJordan

DataprovidedbytheCentralBankofJordan

9

DataprovidedbyCentralBankofJordan

RankingofJordanianExportComplexityAcrossTime

DataprovidedbyEconomicComplexityIndex(MITMediaLab/HarvardCenterforInternationalDevelopment)

10

11

*DataforpreviousthreechartsprovidedbytheUnitedNationsIndustrialDevelopmentOrganization

DataprovidedbyWorldIntellectualPropertyOrganization(WIPO)

12

Harrowingastheviewisfromthemacroperspective,itimproveslittlefromthe

perspectiveofthefirm.Between2015and2017,ofthe189corporationslistedontheAmman

StockExchange(ASE),morethanhalf(96)postedeitherdecliningratesof(pre-tax)profitsor

increasingratesoflosses.Moreworrisome,perhaps,duringthissameperiod,greaterthanathird

(68)ofthesepubliclytradedenterprisespostedatleasttwoyearsoflosses.6

Iftheprevalenceofnon-profitabilitygoessomewaystowardsestablishingthestateof

contemporaryeconomicdistress,theprevalenceofnegativegrowthgoesevenfurther.Forthe

sameperiodjustdiscussed,roughly55%ofthecompaniestradedontheASE(106intotal)

reportednetlossesinaggregatefixedassets.7Shouldoneexcludethebankingandinsurance

6 Onasectorbysectorbasis,eightofthefifteenfirmsinthebankingsectorposteddecliningratesofprofit,

fourteenofthenineteenintheinsurancesectorpostedeitherdecliningratesofprofitorincreasingratesoflosses(twofirmsalsoexperiencedlossesinatleasttwooftheyearsunderexamination),fifteenofthethirtyinthefinancialservicessectorpostedeitherdecliningratesofprofitorincreasingratesoflosses(sixteenexperienceslossesinatleasttwoyears),fifteenofthethirtythreeintherealestatesectorpostedeitherdecliningratesofprofitorincreasingratesoflosses(twentyexperiencesatleasttwoyearsoflosses),threeofthesixintheeducationsectorposteddecliningratesofprofit,sevenoftheeightinthehotelsandtourismsectorpostedeitherdecliningprofitsorincreasinglosses(oneexperiencedlossesintwoormoreyears),sixoftheteninthetransportationsectorpostedeitherdecliningratesofprofitorincreasinglosses(threeexperiencedlossesinmorethantwoyears),theonemediacompanylisted(Al-Rai)postedbothadecliningrateofprofitandtwoyearsormoreofpre-taxlosses,twoofthefourintheutilitiessectorposteddecliningratesofprofit,oneoftheteninthecommercialservicessectorpostedeitherdecliningratesofprofitorincreasinglosses(threeexperiencedlossesintwoormoreyears),twoofthefourinthepharmaceuticalssectorpostedeitherdecliningprofitsorincreasinglosses(oneexperiencedtwoormoreyearsoflosses),twooftheseveninthechemicalssectorpostedeitherdecreasingratesofprofitorincreasinglosses(fourexperiencestwoormoreyearsoflosses),sixofthenineinthefoodandbeveragesectorpostedeitherdecliningprofitsorincreasinglosses(oneexperiencedlossesintwoormoreyears),oneoftwointhetobaccosectorpostedbothincreasingratesoflossandtwoyearsormoreofloss,sevenofeleveninminingandextractionpostedeitherdecliningratesofprofitorincreasingratesofloss(sixexperiencedtwoormoreyearsoflosses),twoofseveninengineeringandconstructionpostedeitherdecliningratesofprofitofincreasingratesoflosses(fourexperiencedtwoormoreyearsoflosses),twoofthreeinelectricalindustriesexperiencedlossesintwoormoreyears,twoofthreeintextilespostedeitherdecliningratesofprofitorincreasingratesoflosses(oneexperiencedtwoormoreyearsoflosses),andthreeoffourinhealthcareservicespostedeitheradecliningrateofprofitoranincreasingrateoflosses(oneexperiencedtwoormoreyearsoflosses).

7 Forthebanking,finance,andinsurancesectors—wherebusinessisnotdirectlyrelatedtofixedcapital

formation—Iaccountedforgrowthbymeasuringtotalassets(ratherthanfixedassets).

13

sectorsfromthesecalculations—sectorsrelativelyunaffectedbynegativegrowthinrecent

times8—,themagnitudeofthisgeneralized,economy-widetrendtowardsdivestmentand

diminutioncomesintoevenstarkerrelief,withafull64.5%ofnon-banking,non-insurancefirms

postingnetlossesinfixedassets.9Itiscertainlyworthaskingwhetherthefirmstradedonthe

ASEareperfectlyrepresentativeoftheprivatesectorwritlarge.Regardless,however,the

torpiditytheyevincenecessarilyreflectsarottingfoundationintheheartofJordaniancapitalism.

Theaccuracyofsuchaninferenceiscorroboratedinthelabormarket.Herein,oneought

beginwithjobcreation,whichhasbeenqualitativelyinsufficientacrossthetenureofKing

Abdullah.From2005to2009—arelativeboomtimefortheJordanianeconomy—,theEconomic

ResearchForum’sJordanLaborMarketPanelSurvey(JLMPS)establishedthattheJordanian

economygenerated35,000to45,000netjobsperannum.10Inadequateasthesenumbersalready

were,theyunsurprisinglymadelittleprogressintheyearsfollowingtheglobalfinancialcrisisof

2008-2009.Despitereceivingamajorbumpfrompublicsectorhiring,between2010and2016,

8 Onlythreebankingfirmsandfourinsurancefirmspostednegativegrowthratesbetween2015and2017.9 Seventeenofthirtyfinancialservicesfirmspostedadeclineinassets;twenty-sevenofthirty-threerealestate

firmspostedadeclineinfixedassets;threeofsixeducationfirmspostedadeclineinfixedassets;fourofeighthotelandtourismfirmspostedadeclineinfixedassets;sixoftentransportationcompaniespostedadeclineinfixedassets;Al-Raipostedadecline;oneofthefourutilitiesandenergyfirmspostedadeclineinfixedassets;fiveofthetenfirmsinthecommercialservicessectorpostedadeclineinfixedassets;twoofthefourpharmaceuticalfirmspostedadeclineinfixedassets;fourofsevenchemicalfirmspostedadeclineinfixedassets;bothfirmsinthepaperandcardboardandprintingandpackagingsectorsposteddeclinesinfixedassets;fiveofninefoodandbeveragefirmsposteddeclinesinfixedassets;oneofthetobaccofirmspostedadeclineinfixedassets;nineofelevenminingandextractionfirmspostedadeclineinfixedassets;fiveofsevenengineeringandconstructionfirmspostedadeclineinfixedassets;allthreeelectricalindustriesfirmspostedadeclineinfixedassets;twoofthreetextilefirmspostedadecline,andtwoofthefourmedicalservicesfirmspostedadecline.

10 RaguiAssaad,“ThestructureandevolutionofEmploymentinJordan”,inRaguiAssaad(ed.)TheJordanianLabor

MarketintheNewMillenium(2014),p.5.

14

netjobcreationaveragedoutatroughly38,000jobsperannum,whichtranslatestoannual

employmentgrowthrateofjust2.1%peryear.11

Whenoneexaminesthekindsofjobsbeingcreatedduringtheselostdecades,itbecomes

apparentthattheJordanianeconomyisalsoproducingdisproportionatelyfewopportunitiesfor

high-skill,high-wageworkers.Thetablebelow,displayingnetjobcreationsince2007according

toeconomicactivityandaccordingtowhetheranindividualisemployedbythepublicorthe

privatesector,givessomeindicationofthisstructuralfact.

JobCreationinNumbers(SectorandActivity)12

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

PublicSectorjobscreated 22230 26820 26760 18402 18248 16171 11487 17158 21408 15043 19532PrivateSectorjobscreated 47427 40386 46599 43584 33544 30756 35594 31391 26904 35203 32882JordanianPrivatesectorjobs 34849 32227 32715 36360 29375 26568 28236 26111 22290 29714 28883Non-JordanianPrivatesectorjobs 12579 8159 13885 7224 4170 4188 7358 5280 4614 5489 3999Wholesaleandretailjobs 10499 9525 11737 7786 7249 6870 9897 9514 6181 7438 7329Manufacturing 5948 6512 5274 7039 5462 5858 5980 4286 4143 4641 4148AccomodationandFoodservices 1301 1748 2247 3002 1866 2623 2375 3578 2486 5496 3025ICT 1683 1963 1087 641 1252 354 1432 1306MiningandQuarrying 1873 364 545 85 255 119 -113 264 3 -218 187Financialservices 2063 1938 1045 1984 1190 1466 1354 1090 1685 189 1647RealEstate 4176 3912 2628 125 70 173 280 -127 104 -20 44Householdemployment 5019 3437 2917 3410 2479 2532 3327 2682Professionalservices 1860 1734 843 909 1347 1198 2051 2127Humanhealthandsocialwork 3253 5191 5876 5990 4525 3692 3109 2968 3013 3653 4197Construction 3314 3062 723 761 -254 1024 1839 965 738 1527 -634NetJobscreated 70356 69092 76316 62813 52888 48068 48571 49935 48309 50853 53969

11 RaguiAssaadandColetteSalemi,“ThestructureofemploymentandjobcreationinJordan:2010-2016”,Working

Paperno.1259,TheEconomicResearchForum(2018),p.4.12 ThedatainformingthistablehasbeendrawnfromtheJordanianDepartmentofStatistics,adivisionofthe

country’sMinistryofPlanningandInternationalCooperation. Ofnote:theclassificationsystemwasadjustedin2009,atwhichpointrealestaterelatedjobswerealsomade

inclusiveofbusinessactivitiesrelatedjobs.

15

Totheextentthatnewworkexiststoday,then,itisinthesectorsofwholesaleandretail

commerce,accommodationandfood,andhouseholdbusinesses.13Thedominanceofthese

sectorsintermsofjobflowshasalsoimpliedatransformationtotheaggregatejobstocksin

Jordan.Datafrom2016showthatapproximatelytwothirdsofallJordanianwageworkersare

nowemployedinlow-wage,low-skillservicejobs.14

Tomakeableakpicturebleaker,oneneedalsorecognizethatnon-Jordaniansconstitutea

significantpercentageofthoseobtainingworkinthelow-wageservicesector—asectorthat,as

justdetailed,representsthesinglelargestsourceofcontemporaryjobcreation.15Inaggregate

terms,theconfluenceofthesetwofactshasresultedinnon-Jordaniansabsorbingbetween50-

75%ofallthejobscreatedinthepost-2010period.16Byextension,thesefiguresmeanthat

13 Thoughthetableevincessomewhatencouragingfiguresasregardsjobscreationinthemanufacturingsector,

oneshouldbejudiciousinevaluatingthenatureofthesegains.Asnearly40%ofallmanufacturinglaborworksinenterprisesemploying1-4individuals,thegainsshowninthedataarenotareflectionofahealthyexpansionintheindustrializedworkforce;rather,itisareflectionofthestate’spromotionofhouseholdenterprisesandmicroenterprisesoperatinginthefieldofsmallscalefoodprocessingandhandicrafts.

Inaddition,thoughthetablemightleadonetobelievethatthehumanhealthandsocialworkjobmarketshave

experiencedasignificantjumpinlabordemand,itisworthnotingthatthesejumpsarealmostentirelypoweredbygovernmenthiringcampaigns.

14 AssaadandSalemi(2018),p.12.15 Thisnon-Jordaniansubpopulationiscomprisedofroughly54%Egyptians,20%Syrians,20%otherArabs,and

6%SouthandEastAsians.16 See:TheMinistryofLabor,TheNationalLabourMarketIndicators:2013-2017.PublishedbytheLabourMarket

InformationDepartment(Amman,June2018),pp.43-44. Duetoselectivelegalpermittingandelite-benefitingimmigrationpolicies,non-Jordaniansnowrepresent

majoritiesofthelaborforcesacrossthefollowingeconomicactivities:householdemployment,manufacturing,accommodationandfoodservices,andconstruction.Thesesamepopulationsalsorepresentasizablesegmentofthewage-workersinthewholesaleandretailcommercesector.Thisallbeingthecase,non-JordanianshavecolonizedallthegrowthsectorsinthecontemporaryJordanianeconomy.

ThelatestdatareleasedfromtheMinistryofLaborconfirmsthecontinuationofthesetrends.In2017,the

aggregatenumberofpermittednon-nationalworkersintheJordanianlabormarketgrewto390,091.Thenewest

16

duringthesesameyears,Jordanianjobseekershavebeenlefttofightoveratotalof9,000-10,000

newemploymentopportunitiesperannum.17Theimplicationsforthenationalunemployment

rate(andfortheemployment-to-populationratio)shouldbeobviousenough.

Whilethefollowingtablesandchartsexcludenon-registered,illegalforeignlaborersfrom

theirtabulations—therebyexcludingasubpopulationthatitselfnumbersinthehundredsof

thousands—,theyshouldnonethelessgivethereaderasenseforthemagnitudeoftheforeign

presenceintheJordanianlabormarket.

* Graph provided by Francoise de Bel Air, Migration

Profile:Jordan.PolicyBrieffortheRobertSchumanCentre

forAdvancedStudies(November2016),p.7

recipientsofworkpapersprimarilycamefromtheSyrianrefugeepopulation(anadditional7.5thousand),theAfricanmigrantpopulation(4.4thousand),theEgyptianmigrantpopulation(2thousand)andfromnon-ArabAsiancountries(2.1thousand).

17 AssaadandSalemi(2018),pp.4-5.

17

TableprovidedbyMinistryofLabor(2018),p.43

18

Byvirtueofthefactthatthelaborsupplyhasgrownexponentiallyduringthedecadesof

Abdullah’srule—notonlyinrawnumbersbutinlevelsofeducation—,deficienciesinprivate

sectorlabordemandhaveprovenevenmoreacutelyconsequentialthanwouldotherwisebethe

case.Nowherearetheseconsequencesmoreobviouslymanifestthanintheareaof

unemployment.18Between1999and2009,theunemploymentratefloatedbetween13%and

16%.SpikingevenfurtherupontheeruptionoftheArabUprisings,atthetimeofwriting,itsitsat

18.7%(March2019).19

Thoughunemploymentisauniversal,non-discriminatingafflictioninJordan,itis

incommensuratelysufferedbytheyoung,thehighlyeducated,andthefemale.Regardingits

genderedproperties,femaleunemploymentratestrendconsistentlyandsignificantlyabove

nationalaverages,irrespectiveofeducationoranyothermediatingvariable.Themostrecent

estimatesoftheILO(2018)positafemaleunemploymentrateof25.1%.20Ifonlytofurther

underscoretheprivatesector’sendemicinadequacies,itisworthnotingthatthispercentage

18 ThisdissertationwillarguethatunemploymentinJordanisprimarilyafunctionofdemandsidefailuresinthe

labormarket(i.e.inprivatesectorjobcreation).AsIwilllatercontend,IbelievethesefailurescanbebestexplainedthroughunwindingthecoimbricatedhistoriesofJordanianstateandclassformation.WhiletheHashemiteregimeanditspartnersinWashingtonhavelongtriedtoattributeunemploymentandeconomicnon-participationtoeitheranassortmentofpsychicpathologiesandhumancapitaldeficienciesonthepartofjobseekersortothedistortingeffectsgeneratedbythepublicsector,thesechargesaresuperficial,incomplete,ideological,andself-serving.

Formoreonthis,see:ColinPowers,“Policyconvergence,(under)development,andJordanianeconomicsunder

KingAbdullah”,MiddleEastLawandGovernance(forthcoming).19 ThisfigurewaspublishedtheDepartmentofStatisticsinMarch,2019.20 Datacanbeaccessedat:https://ilostat.ilo.org/

19

wouldactuallybemuchlowerwereitnotforpost-uprisingspublicsectorhiringcampaigns

withinthefieldsofeducation,healthcare,andsocialwork.21

DataprovidedbytheJordanianDepartmentofStatistics

Thattheeducatedjobseekertooexperiencesunemploymentatratesinexcessofthe

nationalaverageissimilarlybeyondcontention.22Taking2010asanexample,wherecollege

21 See:AssaadandSalemi(2018),p.17.Theirsurveyresearchshowsthatwomenactuallydisproportionately

benefitedfromthepublicsector’spost-uprisingsexpansion.Intheaggregate,however,thosepublicsectorjobsarestillrelativelyscarce.

Importantly,itisalsocriticaltonotethatwhenfemalejobseekersareunabletosecureformaljobswithinthepublicsector,theydonotturntotheprivatesector;rather,theydropoutofthelaborforceinshockinglyhighnumbers.

22 Itisalsoworthnotingthattheincrementalreturnsofeducation(onwages)havedeclinedinrecentyears. See:RamiGalalandMonaSaid,“TheevolutionofwageformationandinequalityinJordanin2010-2016”,

WorkingPaperno.1209,EconomicResearchForum(2018),p.4. Thisisinpartafunctionof2013legislationthatputacapongovernmentandcivilservicewages,acapthat

would,bydefinition,affectthewagesofhighskill,higheducatedindividualsnearthetopofthebureaucracy.

20

educatedjobseekerscomprisedonly13%ofthelaborforce,theyneverthelessmadeup30%of

thecountry’sunemployed.23Someofthis,ofcourse,canbeexplainedbythefactthatcollege-

educatedjobseekersarerepresentingagreatershareofthenewentrantscomingintothelabor

marketeachyear(asthechartsonthenextpagesattest).24Asnewentrantsarelikelytospend

sometimesearchingforajob,theirunemploymentnumbers—and,byextension,the

unemploymentnumbersofcollegegraduates—arealwaysgoingtobeinexcessofnational

averages.25Andyet,theexplanatorypowerofthispropositionwillsoonbeshowntobelimited

justastheplightoftheeducatedjobseekerwillbeshowntorunfardeeper.26

23 Assaad(2014),p.9.24 Whilethecollegeeducatedcomprisedjust8%oftheworkingagepopulationatthestartofAbdullah’sreign,by

2010,theywereconstituting30%ofallnewlabormarketentrants(Assaad,2014,p.9).25 Whenoneconsidersthat2010,theyearthesestatisticswererecorded,alsocoincidedwithamoregeneralized

economicdownturn,itisreasonabletoassumethatthejobsearch-to-employmentpipelineforcollegegraduateswouldhavebeenmorecongestedthanusual,andthattheirunemploymentratewouldhavehavebeenfurtherinflatedasaresult.

26 Toforeshadowargumentsthatwilllaterbedevelopedindetail,itwillbedemonstratedthatindustrialand

investmentpolicyoverthepasttwentyyearshavepredominantlyservicedbusinessinterestsoperatinginthefieldsofluxuryrealestate,construction,andlowsophisticationgarmentmanufacturing.Asemploymentopportunitiesinthesesectorsarelow-skillinnatureandastheprofitmarginsachievedineachofthesesectorsdependsuponanumberofimplicitsubsidies—includingtheabilitytoemployunprotected,lowskillforeignlaborers—,thestate-backedboomtheyhaveexperiencedhasdonepreciouslittleforthecollege-educatedjobseeker.ItwillalsobeshownthatAbdullah’spoliticizeduseofpublicsectorhiringinthepost-uprisingsperiodhasdisproportionatelyrewardedloweducation,lowskilljobseekers—meaningthatcollegegraduateshavefoundlittlejoyinthebureaucracyaswell(Assad,EmploymentandJobcreation,p.9).

21

EducationalLevelsofNewMarketEntrants,1960-201027

TheUnemployedbyEducationLevels(2000-2010)28

27 ChartprovidedbyAssaad(2014),p.928 ChartprovidedbyAssaad(2014),p.8

22

TheJordanianEmployed2013-201729

Asforthepervasivenessyouthunemployment—whichhashoveredbetweenthreeand

fourtimesthenationalaverageforthepastdecade30—,noperspicacioussociologicalimagination

isrequiredtodeterminethatittootracesbacktoanemicprivatesectorjobcreation.Asearlier

detailed,theJordanianeconomy(publicsectorincluded)generatesroughly35,000-45,000job

opportunitiesperannum.Thepercentageofthepopulationthatisfifteenyearsorgreater,

meanwhile,isgrowingatapproximately3.8%/year.Innominalterms,thismeansthatwitheach

yearthatpasses,afreshcohortofapproximately158,00015year-oldsiscomingofage.31

29 ChartprovidedbyMinistryofLabor(2018),p.1730 Asanotherwayofconceptualizingthisphenomenon,oneshouldalsoconsiderthattheyouthemploymentrate

hasdroppedfrom48%in2010to37%in2016. See:AlAzzawiandHlasny(2018),p.7.31 Thesefiguresaredrawnfromthe2016JordanianEmploymentandUnemploymentSurvey(EUS2016)

conductedbytheJordanianDepartmentofStatistics.

23

Assumingthatroughlyhalfoftheseindividualsdelaytheirentrytothejobmarketsotocontinue

theirstudies,onecanconservativelyestimatethatsomewhereintheareaof50,000newfifteen

year-oldsarejoiningthelabormarketeachyear.Incombinationwiththefreshhighschooland

collegegraduatesdoingthesame,economistshavetherebyestimatedthatthetotalnumberof

newjobseekerswillfluctuatebetween70,000and90,000perannum.32Subtractingnetjob

opportunitiesfromnewjobseekers,then,onecanseethat35,000to55,000young,first-time

entrantstothelabormarketwillfailtofindworkeachyear.

Beforeclosingontheunemploymentcrisis,IwouldberemisswereItoignorethatit

appearsimpervioustoeconomicgrowth.Indeed,whilecontemporaryunemploymentinJordan

hasdemonstratedapredictableresponsivenesstoeconomicdownturns33,theinverseeffecthas

notbeenevincedduringperiodsofhigheconomicgrowth.DuringthefirstdecadeofAbdullah’s

rule—theaforementioned1999to2009period—,forinstance,despiteGDPgrowthfigures

averagingoutataround6%perannum,theunemploymentratefailedtomakeanysubstantial

gains.34

32 See:ShireenalAzzawiandVladimirHlasny,“YouthVulnerabilityinEgyptandJordan:Dimensionsand

Determinants”,WorkingPaperno.1275,EconomicResearchForum(2018). Forafullstatisticalreview,seethedatabasesofAl-ManarCenterforHumanResourceDevelopment.Accessible

at:http://www.almanar.jo/en/human-resources-information/onlinestatistics 33 Oncegrowthcollapsedfollowingtheonsetoftheglobalfinancialcrisis,thisnegativeresponsivenessofthe

unemploymentwouldbedemonstratedquiteclearly.Thoughsignificantincreasesinpublicsectorhiringhelpedpartiallymitigatelossesinthelabormarket—thepublicsectoremployment’sshareintotalemploymentincreasedfrom39%in2010to42%in2016—,itwasatthisstagethattheunemploymentratetrackedupwardstowards20%.

See:AssaadandSalemi(2018),p.17.34 ThisiswelldocumentedbyAssaad(2014),p.1-5.

24

Importantly,themeagernessofprivatesectorjobcreationisnotonlyimplicatedin

Jordan’sdangerousunemploymentlevels;italsoinformsthecountry’swoefullaborforce

participationrates.Between2015and2017,onlytwoineveryfiveworkingageJordanianswas

activelyparticipatinginthelabormarket.35Whenoneaccountsforthefactthatroughlyoneof

everyfiveeconomicallyactivepeopleisunemployed,thismeansthattheemploymentratein

Jordanaveragedoutaround32%duringtheseyears,afigurelargelyinkeepingwithrecent

historicaltrends.AcrossthedurationofAbdullah’stenure,infact,annualemployment-to-

populationratioshaveneveronceexceeded37%.36Bywayofcomparison,theaverage

employmenttopopulationratiosforbothOECDandlowermiddle-incomecountriesduringthis

sameperiodwereapproximately56%.37

Whileextremelylowlaborforceparticipationratesamongstfemalesgoalongway

towardsexplainingthesedepressedfigures—forthepost-2000period,ILOestimatesshow

35 See:JordanStrategyForum,“OntheimportanceoflaborproductivityinJordan:whereisthechallenge?”,Report

(2018),p.5. AswasalsoestablishedthroughtheJPLMS’slongitudinal,surveybasedanalysis(extendingbetween2010and

2016),themostpersistentlabormarketstateforthirty-fivetosixty-fouryear-olds—meaningthestatefromwhichapersonwasleastlikelytotransitionoutofduringtheinterveningperiod—wastobe“notemployed,notineducation,notintraining”(NEET).Ashocking90.8%oftherespondentsthatindicatedtheywereinaNEETstatein2010wouldremaininsuchastateasof2016.

Formoreonthis,see:AssaadandSalemi(2018),p.14.36 Thispercentageiscalculatedasthenumberofemployedpeopleovertheageof15againstthetotalpopulation. Forthevastmajorityofthisperiod,theemploymenttopopulationratiohasfluctuatedbetween32%and36%

accordingtoILOandWorldBankdata.37 HadJordan’snewentrantsintothejobmarketbeenintegratedatappropriatelevels,demographicsdictatethat

theexpansionofthelaborpoolwouldhavepushedemployment-to-populationratiosupnear65-70%.Sucharatiowouldhavefacilitatedgainsnotonlyintermsofaggregatedemandandgrowthbutalsointermsofgovernmentrevenues.

25

annualfemalelaborforceparticipationrateshoveringbetween11.2-14.9%—,itisimportantto

notethatJordanianmalesarecheckingoutofworkatincreasingratesaswell.Between2010and

2015alone,maleemployment-to-populationratiosdeclinedbyroughly15%,droppingfroma

64%rateatthebeginningoftheperiodtoa55%ratebyperiod’send.38

Justaswasthecasewithunemployment,laborforcenon-participationisalsoparticularly

highamongstJordanianyouth.Worsethanthat,recentdatasuggeststhattheyoung’s

disengagementfromtheeconomydoesnotreflectatemporaryresponsetoatemporarily

distressedlabormarket,butrather,asemi-permanentcondition.39AsAssad’slongitudinallabor

marketanalysisdocuments,47%ofthose15-34year-oldswhowerenotemployed,notin

education,andnotintraining(NEET)in2010remainedinthatsamelabormarketstateasof

2016.40Onthebasisofthesefindings,itisreasonabletoconcludethataninitialfailurein

transitioningtothelabormarketcanresultinlong-termeconomicwithdrawal—andallthat

impliesforboththeindividualandfornationaldevelopment.

38 AssaadandSalemi(2018),p.3.39 Asof2016,44.9%ofallrespondentstotheDepartmentofStatisticsEUSlabormarketsurveyindicatedthatthey

droppedoutofthelaborforceduetotheirbeliefthattherewasnoworkavailablewhile21.4%didsobecausetheycouldnotfind“suitablework.”Whenoneconsidersthatthosepercentagesare41.6%and15.3%,respectively,forthoseaged15-24—withanother14.3%expressingjobsearchfatigueastheprimaryreasonfornon-participation—,onecanseethattheyoungareexperiencingasenseofhopelessnessandapathy,andthattheprospectsofalostgenerationareveryrealindeed.

ThesefindingsarecorroboratedbytheJPLMSof2016aswell.See:AlAzzawiandHlasny(2018),p.4.40 See:AssaadandSalemi(2018),p.43. AsIwilldiscussinthesectionondiscipline,muchofthisimmobilityistheresultofnegativeexternalities

introducedbytheregime’sattemptstoformalizethelabormarket.

26

DataprovidedbyWorldDevelopmentIndicators(WorldBank);ILOestimates

DataprovidedbyWorldDevelopmentIndicators(WorldBank);ILOestimates

27

ForthescarcefewJordanianswhoareabletofindwork,moreover,itiscriticalto

emphasizethatemploymentislikelytoaffordthemlittlebeyondapovertywage.Onthebasisof

datafurnishedbythe2010JPLMSsurvey,forinstance,GalalandSaidconservativelyestimated

that49%ofJordanianworkersearnedawageplacingthemandtheirfamiliesbelowthelow

earningsline.41Thoughthesameauthorscontendthatthepassageofminimumwagelegislation

in201342managedtoreducethispercentageto21%asof2016,theircalculationsarethe

productofhighlydubiousmethodologicalchoices.43Mostsimplyput,GalaandSaid’s

determinationofthe

41 Thelowearningslineiscalculatedbymultiplyingthenationalpovertylineagainstthenationaldependencyratio

(i.e.howmanynon-laborersinahouseholdaredependentonthewagesofthebreadwinner).TotheextentthatthenationalpovertylinedoesnotaccuratelyreflecttherealityofpovertyinJordan,itisexceedinglypossiblethatthislowearningslinewillwindupstructurallyundercuttingtherateofworkingpovertytoday.

42 Their21%figureisreferencedonp.8(GalalandSaid2018). Since2010,thePalacehasfrequentlylegislatedincreasestothenationalminimumwage.Asof2019,the

minimumwagehasbeensetat190JD. Regardingtheeffectsofthesepiecesoflegislation,anumberofpointsneedtoberaised.Firstly,aswillbeargued

onthenextfewpages,Ibelieveitisreasonabletoconcludethatawageof190JDpermonthwouldstillleaveafamilyindefactopoverty.Whileanicestepforward,then,theimplementationofaminimumwagestillleavesalottobedesired.Secondly,Jordan’sMSME’shavealong-demonstratedhistoryofinformalbusinesspractices(i.e.non-compliancewithgovernmentregulations).Thisbeingthecase,itcanbeassumedthatmanysuchbusinessescontinuetopaywageswellbelow190JDpermonth.GiventhatMSMEsemployapluralityofJordanianworkers—aswellasthevastmajorityofthosemostlikelytobeaffectedbysuchlegislation—,thishistoryofnon-compliancesuggeststhatthegovernment’seffortsareunlikelytoreachmanyoftheworkersmostinneedofsuchinterventions.

43 Specifictomyskepticism,oneneedbeginwiththefactthatthemethodologythroughwhichboththeJordanian

governmentandtheaforementionedGalalandSaidcalculatetheirnationalpovertylineishighlydubious.Byconsequenceoftheiruseofinheritedformulaeandoutdatedandinvalidcostoflivingassumptions—issuesalsoplaguinghowwesterncountriesengagewithquestionsofpovertytoday—,eachoperatesfromthepremisethatthatJD80.2permonthissufficientforkeepinganindividualoutofpoverty.Asadailyfigure,thisbreaksdowntoJD2.67,anumberthatIwillshowtobewhollydissonantfromwhathouseholdexpendituredatasuggestsisneededtokeepsomeoneclothed,sheltered,andfedinmodernJordan.

Whatismore,itisworthnotingthatGalalandSaid’sdeterminationofasignificantdropinworkingpoverty

between2010and2016hadalsobeenpoweredinnosmallpartbyasomewhatarbitrarymethodologicalrevision.Specifically,thescholarschangedthedependencyratiointheirformulafrom4.0to3.0(e.g.theyshifted

28

lowearningslinehadbeencalculatedonthebasisofapovertylinesetat2886JDperannumfor

afamilyoffour.AreviewofhouseholdexpendituredatagatheredbytheJordanianDepartment

ofStatistics,however,makesclearthatsuchanincomeisinnowaycommensuratewiththe

moderncostofliving,evenaftercontrollingfortheinflationaryeffectsofAmman’scosmopolitan

exception.44HouseholdexpendituresinJordan’sfourpoorestgovernorates—Ma’an,Tafila,Karak,

andBalqa—,forinstance,averageoutatapproximatelyJD6606.9,JD4727.5,JD6510.3,andJD

7233.7peryear,respectively.Totheextentthatthesegovernorateswitnesspervasiveand

generationalpoverty,thefactthatsuchfiguresaremagnitudesgreaterthantheofficialpoverty

lineusedinGalalandSaid’sanalysissuggeststheauthors’claimsarenecessarilyandunduly

conservative.

Inaddition,evenifoneweretoacceptGalalandSaid’sspuriouspovertyline—andagree,

foramoment,thatthatanincomeofroughlyJD3,000perannum(orJD250permonth)mightbe

stretchedthroughoneformofalchemyoranothersotocoverthebasicneedsofaJordanian

family—,areviewofmedianandmeanwagesissufficienttoestablishthatamajorityof

Jordanianworkersstillremainperilouslyclosetoimpoverishmenttoday.Themedianwagein

theirformulaontheclaimthatanaveragewageearnerin2016neededtoonlysupportthreeotherhouseholdmembers,ratherthanfour,aswasthecaseon2010).WhentakeninconjunctionwiththepovertylinethathasbeenassertedbytheJordaniangovernment,thisdependencyratioyieldsalowearningslineofJD240.5permonthperhousehold.ThisequatestoanannualwageofJD2886.

44 In2017,forexample,theDepartmentofStatistics’surveyfoundthattheaveragefoodexpendituresofa

JordanianhouseholdaloneamountedtoJD4079.7. ThoughonemayassumethatthisfiguretobepartiallyinflatedbythespendingoftheAmmanielite—asmight

alsobethecasewithaverageexpendituresonhousingandutilities,whichamountedtoJD2921thatsameyear—,suchaverages,whichtogetheradduptoafiguremorethanthreetimesthenationalpovertyline,shouldminimallygiveonepauseinacceptingtheclaimsputforthbyGalalandSaid.

29

Jordanin2016wasamereJD370JDpermonth,afterall.45Whenoneexcludescushier(and

muchmaligned)publicsectorjobs,moreover,thismediandropsallthewaytoJD300.46This

beingthecase,simplearithmeticcanestablishthat60JD/monthconstitutesthemarginkeeping

amedianworkingfamilyabovea(structurallydeflated)povertyline.Combinedwiththefactthat

just1.1%ofthosequestionedundertheJLMPSreportedhavinganysavings,thefundamental

(andexistential)precaritythreateningeventhosefamiliesfortunateenoughtohaveanemployed

memberamongsttheirnumber—andfortunatetobeoutsideofficialpoverty—shouldbesimple

enoughtoappreciate.47Towork,especiallyfortheyoungergenerations,istoworkwhilepoor,

barelyabletokeepone’sheadabovewater.

45 Thisdoesrepresentanincreasefrom2010’smedianfigureof319.46 Disaggregatingthedistributionfurther,onewouldseethatthemedianwageforyoungerwageearners(15-29

years-old),inclusiveofpublicsectorworkers,wasjust300JD/month,andthatthemedianwageforuniversitygraduatesisjustJD400/month.

47 Whatismore,giventhatfiscalconsolidationhasresultedinadistinctandqualitativedeclineinpublicservices—

arealityofcontemporaryJordanianlifethathasbeenamplydocumentedbyWorldBankeconomistsinthepost-ArabUprisingsperiod—theamountofexpendableincomethatisneededforahouseholdtosecureeducationforitsyoung,healthcareforitsold,etc.,isonlyincreasingatthetimeofwriting.Byvirtueofthefactthathouseholdsmustthereforedevoteincreasing(andincreasinglyscarce)resourcestochildren’seducation,tooutofpockethealthcosts,totransportation,andtofoodandutilities—tobothsocialreproductionandthemereavoidanceofdownwardmobility—,thepovertywagesjustdetailedaremadeevenmoreincommensuratewiththerealitiesofthepresentday.

30

*TableprovidedbyGalal

andSaid(2018),p.18

31

Beyondbeingforcedtolaborforpovertywages,Jordaniancapitalismalsosubjectsits

workerstohighlevelsofinformality.Thoughrecentgovernmentshaveinvestedconsiderable

energyinattemptstoformalizethelabormarket,2016surveydatashowthatupwardsof37%of

Jordanianworkersarestilllackinginbasicsocialinsurance.Accountingfornon-Jordanians,the

percentageofworkerstoilinginformallyjumpsto45.1%.48

Ifhundredsofthousands(ifnotmillions)remaindeprivedofthebenefitsofsocial

insurance,itisworthpointingoutthatthebenefitsofsocialinsurancearealsoofahighlylimited

nature.Circumscribedtotemporaryunemploymentassistance(cappedatsixmonths)andapay-

as-you-gopensionsystem,492014’sSocialSecurityLawhasleftquestionsofhealthinsurance50,

sickleave,andfamilybenefitsoutsidethepurviewofthestate’sinterventionism.Without

diminishingthegainsthathavebeenrealizedthroughformalization,then,oneneedrecognizethe

parlousconditionsthatpersistforthebeneficiariesofthisinitiativeasmuchastheenduring

plightofthoseleftlanguishingininformalworkarrangements.51

48 See:GalalandSaid(2018),pp.6,12. Whatisworse,whatgainshavebeenmadeinformalizationhavebeenachievedthroughshiftingformerlyfull-

timeworkersintoirregularemployment,asIwilllaterdetail.49 2014’sSocialSecurityLawalsoinstitutedanumberofparametricchangestothepensionsystem,changesthat

functionedsotorestricteligibility,increasecontributionrates,andreducebenefits.Underthetermsofthislaw,employeescontribute10%oftheirsalarytotheSocialSecurityCorporation,whileemployerscontribute7%ofthatindividual’ssalary.

Itisworthnotingthatthislawdidestablishmandatorymaternityleaveasthelawofthelandintheprivate

sector;however,asthereisapaucityoffemaleworkersemployedintheprivatesector,thisachievementissomewhathollowinitsactualsocialeffects.

50 Only30%ofprivatesectorworkersinJordanhaveaccesstoemployerprovidedhealthinsurancearrangements

(See:AssaadandSalemi,2018,p.13)51 GiventheproclivitythatMSMEownershavedemonstratedwhenitcomestostealingemployees’socialsecurity

contributionsandskirtingtheirownobligations,thereareanumberofotherreasonsforbeingsuspiciousofthe2014legislation’sachievementsaswell.

32

*GraphprovidedbyAssaad(2014),p.27

Afullauditingofformalization’ssocialandeconomiceffectswouldalsorequirethatone

addressanumberofthenegativeexternalitiesborneofthepolicyinitiative.Themostsalientof

thesewastopushincreasingpercentagesoflaborersintopart-timeand/ortemporarycontract

Formoreonthehistoryofmachinationswithsocialsecurity,see:HaniHourani,TheJordanianLabourMovement,

Report:FriedrichEbertStiftung(Amman,2002),p.66.

33

workarrangements.52Thisirregularization(ortemporarization)ofworkhasafflictedboth

formalandinformalsectorsofthelabormarketatincreasingratesoverthepasttenyears.

Regardingtheformalsector—inclusiveofthoseworkinginbothapublicandprivatecapacity—,

thepercentageoflaborersworkingunderapermanentcontractdeclinedfrom57%in2010to

52%in2016.Asfortheinformalsector,wherejust6%ofworkershadbeensubjectedto

irregularemploymentarrangementsasof2010,by2016,thatpercentagehadclimbedalltheway

to31%.53Forfartoomany,then,theeffortsofthegovernmentinrecentyears—andthepassage

of2014’sSocialSecurityLawinparticular—didnotprecipitateatransitionfromregular,informal

worktoregular,formalwork.Itdidnotevenprecipitateatransitionintoirregular,formalwork.

52 Theseoutcomesareafunctionofflexibilization’scentralitytothelargerformalizationinitiative.Thebasicidea

wasthatbyaffordingemployersgreaterdiscretionwhenitcomestohiringandfiring,suchemployerswouldinturnprovemorewillingextendpropercontractsandsocialinsurancetotheiremployees.Thereality,however,hasbeenmuchdifferent.Themoderategainsthatwereeventuallymadeinformalizingthelabormarket—particularlyfollowingthepassageof2014’sSocialSecurityLaw—wereprimarilyachievedbysubjectingworkerstoanewformofvulnerability:irregularity.

53 See:AssaadandSalemi(2018),pp.11-12. Increasedirregularityprevailsinthemodernlabormarketregardlessofthesizeofthefirmemployingaworker.

Infact,largefirms(thoseemployingmorethan100people)areembracingthesepart-timingpracticesaseagerlyasanyoneelse.

34

Rather,it pushedincreasingpercentagesofsociety’smostvulnerable54intoeitherirregular,

informalwork55orunemployment.56

Byanyconceivablemetric,then,itwouldseemthatcontemporaryJordaniancapitalismis

expiringbeforeourveryeyes.Profitratesarelacking,capitalaccumulationislargelyparalyzed,

millionslanguishinoraroundpoverty,andmultiplegenerationshavecometoknownothingbut

downwardmobilityandconstantprecarity.Inviewofbothhistoryandsocialtheory,itwould

thereforeseemplausibletosuggestthatthewidersocialformationnowsitsonthemost

combustibleofpowderkegs—oneneedingbuttheslightestofsparksinordertosetoffa

conflagrationthatmightswallowtheKingdomwhole.Andyet,whileJordanhasseenitsfairshare

54 Regardingthepointonsociety’smostvulnerable,individualslocatedwithinthethreequintilesofJordan’swealth

distributionaredisproportionallyrepresentedamongsttheirregular,informalworkforce.55 In2010,19%oftheJordanianworkforcewasworkinginformallythoughwithregular,full-timehours.In2016,

thisnumberofinformalregularsdroppedto13%.Andyet,this6%declinedidnottranslateintoa6%gainintheformalsector(whetherasregularsorirregulars).Rather,itwasabsorbedbygreaterpercentagesofJordanianlaborersfallingintoinformal,irregularwork:thepercentageofworkerslaboringundersuchconditionsincreasedfromamere1%in2010to6%in2016(AssaadandSalemi,2018,p.7).

Givenboththecostsofformalizationandthescarcityofbenefitsithasgeneratedtodate,itcanhardlybesaidto

havebeenaboonforJordanianworkers.56 Theconnectionbetweenformalizationandunemployment(especiallyforJordaniancitizens)isafunctionof

2014’ssocialsecurityreformsnotobligingdomesticemployerstomakesocialsecuritypaymentsforforeignlaborers.Byconsequenceoftheseexemptions,Jordan’spoor,low-skillworkersweremadecomparativelylesscompetitivewithintheinformallabormarket,ashiringthemwouldrequirethatanemployermakecontributionstotheSocialSecurityCorporation.

Followingfromthis,akindofsubstitutioneffectoccurred:MSMEsinparticulardiscardedthenowlegally

protectedJordanianworkersotoreplacehim/herwithanunprotectedindividualfromthecountry’slargestockofsurplus,foreignlabor.Nolongerabletofindregular,informalwork,manyoftheseJordaniansdroppedoutofthelabormarketaltogether.

See:IbrahimAlharawinandIreneSelwaness,“TheEvolutionofSocialSecurityinJordan’sLaborMarket:a

CriticalComparisonBetweenpreandpost-2010SocialSecurityReform”,WorkingPaperno.1185(2018),EconomicResearchForum,p.4

35

ofprotesting,suchaconflagrationappearsawaysoff.Somehow,someway,thiseconomy(andits

autocraticoverseer)managestoconsistentlyendurewithintheconditionsofitsowndemise.

Clearly,thereissomethingconceptuallyandtheoreticallyelusiveabouttheJordanian

politicaleconomy,aboutaJanusfacedformationwhoseverysolidityimpliesafragility,one

whoseresilienceischaracterizednotbyself-correction,creativedestructionorsystemiclearning,

butofstasisincrisis.Simultaneouslyconfoundingthetheoreticalsuppositionsanchoring

Schumpeterian,neoclassical,andMarxistanalysis,itisaperversityatoncebeguiling,

illuminating,particular,andrepresentative.

…….....……..…..……...…….…..…...............…..…..........……......………...….....…………….…....…………....………………….

ThismonographwillattempttoanswerwhyJordaniancapitalismconsistentlygenerates

suchcrisisconditionsaswellashowitmanagestoendurewithinsuchconditions.Insodoing,it

willprobewhathappenswhenstabilityisachievedamidstandthroughmassdeprivation,and

explorewhatJordaniancapitalismmightteachusmoreabouteconomicsandpoliticsonthe

globalperiphery.

Atthelevelofwidestabstraction,myexpositionsonthewhyofJordaniancapitalism’s

terminal,self-reproducingcriseswillcenteruponthedialecticalinterplayoftwoindependent

thoughdeeplyconnectedvariables:(i)theneoliberal/autocraticmodalityofeconomic

governanceanddevelopmentpolicymakingthathasbeenadoptedbytheHashemiteregime(and

itspoliticalelite)overtheprevioustwentyyears;and(ii)theprofitandrentseekingbehaviorsof

anelitefractionofa(transnational)capitalistclass.Additionally,Iwillpositthattheinterplayof

thesevariables—andtheoutcomessuchaninterplayproduces—isitselfstructuredby(a)

36

historicalendowments(social,political,andeconomicincharacter);(b)conditionsand

imperativesbestowedbyglobalperipherality/externaldependency;and(c)processesdirectly

relatedtoauthoritarianrenewal.57

Usingrigorousprocesstracing,statisticalanalysis,andthickdescription,myanalysiswill

morespecificallydisassemblewhythiscoalescenceofpolicy,peripherality,profitseeking

behaviors,andauthoritarianrenewalconsolidatesaneconomybiasedtowardsspeculativenon-

tradables,importconsumption,andthebuiltenvironment,andexplainwhythesesbiases

prefigurethehighvolatility,lowproductivity,lowgrowth,anddeficientjobcreationdetailed

earlier.Indeconstructinghowthiscapitalisminstitutionalizessystemsofpoweranddistribution

thatareelite-dominated,externally-dependent,andacutelypunitiveofthelowerandmiddle

classes,thisanalysiswillalsoelucidatetheprovenanceofJordan’spersistent(ifcontained)social

strife.

Iwillattributethiscapitalism’ssurprisingendurance—aswellastheenduranceofits

Hashemiteminders—,meanwhile,toaconstellationofinstitutionalbulwarksthatIcollectively

57 Beforeproceeding,Ishouldpointoutthatthedistinctionbeingdrawnbetweenproximateandstructural

causalityisofananalyticalratherthansubstantivenature.Nevertheless,itisadistinctionthatmustbeemphasizedfortwoprimaryreasons.First,itisneededtopreservetheagencyofcontemporaryactorsandtoavoidaregressionintoonereductionist-deterministicformulationoranother.Second,itisinneededinviewofthechallengesthatcounterfactualinferencecouldotherwiseposetomyarguments.Specifically,totheextentthattheregime’sreproductionofpowerneednothaverequiredthespecificmodalityofeconomicgovernancewehavewitnessedinJordan,itwouldholdthatthelatteroughttherebybeconceivedasindependentoftheformer.Similarly,totheextentthattheexperienceofperipheralityortheendowmentsofhistorydidnotsingularlyrequirethebehaviorswehavewitnessedonthepartofthecapitalistclass,theappropriatenessofpure,structuralargumentationwouldbeagaininvalidated.Insomuchashistoricalandcomparativeanalysesaresufficienttoestablishtheplausibilityofboththesecounterfactualpropositions—andasIamkeennottoundulydepriveactorsoftheiragency—,thisdistinctionmusttherebyberetained.

37

refertoasitssocialstructureofaccumulation(orSSA).58Detailingtheprecisemechanisms

throughwhichthesebulwarksmanagetosatisfyelite,high-leveragedpatrons(through

facilitatingupwardandoutwardredistributionsofwealth),securethesolvencyofthestate,and

police,degrade,anddissuadethesourcesofresistancethataretherebyengendered,Iwillfurnish

asingleexplanationcapableofunlockingthisJordanianpoliticaleconomy’ssurprising(albeit

indeliblyfragile)stability.Acasestudyinthecontemporarydisembeddingofaperipheral

economy,itismyhopethatbyresolvingthelogicthroughwhichcapital’sprospectsontheEast

Bankaresimultaneouslybolsteredandcompromised,Icanhelpgrowourknowledgeofactually

existingneoliberalismsinthe21stcentury.

Researchis,ofcourse,aplentywhenitcomestotheMiddleEast’srecenteconomichistory,

particularlywhenitcomestotheregion’srelationshipswiththeinternationalfinancial

institutions,liberalization(broadlydefined),underdevelopment,andpopularuprisings.59A

58 AsIwilldetailinthenextchapter,thesebulwarksincludeinstitutionalizedpracticesofgovernance,state

interventionintheeconomy,marketmakingandmarketregulation,normmakingandsubjectification,socialcontrol,andaparticularmodalityofpolitical-economicrelationsvis-a-vistheoutsideworld.

59 See:JaneHarriganandHamedEl-Said."TheeconomicimpactofIMFandWorldBankprogramsintheMiddle

EastandNorthAfrica:AcasestudyofJordan,Egypt,MoroccoandTunisia,1983-2004."ReviewofMiddleEastEconomicsandFinance(6.2),2010:1-25.

JaneHarrigan,andHamedEl-Said.AidandpowerintheArabWorld:IMFandWorldBankpolicy-basedlendingintheMiddleEastandNorthAfrica.Springer,2009.

RayBush,Povertyandneoliberalism:PersistenceandreproductionintheglobalSouth.PlutoPress,2007. RayBush,"PovertyandNeo-LiberalBiasintheMiddleEastandNorthAfrica."DevelopmentandChange35.4

(2004):673-695. AdamHanieh,LineagesofRevolt:IssuesofContemporaryCapitalismintheMiddleEast.HaymarketBooks,2013. GilbertAchcar,ThePeopleWant:ARadicalExplorationoftheArabUprising.UniversityofCaliforniaPress,2013. KoenraadBogaert,“ContextualizingtheArabrevolts:thepoliticsbehindthreedecadesofneoliberalisminthe

Arabworld”,MiddleEastCritique(22:3),pp.213-234. AliKadri,ArabDevelopmentDenied:DynamicsofAccumulationbyWarsofEncroachment.AnthemPress,2014. ClementMooreHenryandRobertSpringborg,GlobalizationandthePoliticsofDevelopmentintheMiddleEast

(Volume1).CambridgeUniversityPress,2010.

38

wonderfulliteratureexaminingtheintersectionofauthoritarianismandArabcapitalismshas

alsoemergedoverthepasttwentyyears.60

AsforthestateofthefieldwhenitcomestocontemporaryJordaniancapitalismin

particular,heretoowillonefindanabundanceofinsightfulwork.61Regardingwidermattersof

politicaleconomy,TimothyPiro’sThePoliticalEconomyofMarketReforminJordan,publishedin

1998,providesawelldetailedifsomewhatsociologicallynaiveoverviewofthestateroleinthe

economyacrossthetenureofKingHussein.Bringingusclosertothepresentday,Oliver

Schlumberger’sdoctoraldissertation(PatrimonialCapitalism:EconomicReformandEconomic

OrderintheArabWorld)deconstructsnotonlyhowsecondaryoilrentsfinancedthefull

floweringofHashemiteneopatrimonialisminthepost-1973period,butalsohowthat

neopatrimonialismevolvedundertheconditionsofeconomicopeningandliberalization.Focused

onasimilarperiod,WarwickKnowles’doctoraldissertation(ChangingPatternsofRent:State,

PrivatesectorandDonorsinJordan,1989-2000)probeshowstate-capitalrelationsshiftedin

JordanundertheexigenciesofeconomicopeningandIFIinterventionism.Positingthatstateand

capitalarebound(almostontologicallyso)byasharedtendencytowardsrent-seeking,Knowles

60 See:StevenHeydemann.NetworksofprivilegeintheMiddleEast:thepoliticsofeconomicreformrevisited.

Springer,2004. StevenJuanKing,TheNewAuthoritarianismintheMiddleEastandNorthAfrica.IndianaUniversityPress,2009. CemalBurakTansel(ed.),StatesofDiscipline:AuthoritarianNeoliberalismandtheContestedReproductionof

CapitalistOrder.Pickering&ChattoPublishers,2017. EberhardKienle,PoliticsfromAbove,PoliticsfromBelow:theMiddleEastintheAgeofEconomicReform.Saqi,

London,2003. AlanRichards,MelaniCammett,JohnWaterbury,andIshacDiwan(ed.).APoliticalEconomyoftheMiddleEast.

WestviewPress,2013. 61 Regardingtheclassicsinthisgenre,oneneedbeginwithMichaelMazur’sEconomicGrowthandDevelopmentin

JordanandAdolfKonikoff ’sTransjordan:anEconomicSurvey.Whileeachworkdealsexclusivelywiththeearlypost-colonialperiod,theyareimmenselyusefulresourcesinwhenitcomestothetracingoflong-termtrends.

39

keysinonhoweachactorsoughttosecureitsrentsasthewiderpoliticaleconomymovedfrom

whatheconceptualizedastheinducedstaterentierismofthepost-1973yearstothemarket

dominatedrentierismwhichwouldbeconsolidatedinthelastdecadeofthetwentiethcentury.

Moore,Greenwood,andBlueCarrollhavealsoproducedinsightfulworksexaminingthe

business-staterelationshipinJordan,thoughtheyapproachtheirsubjectmatterfromamore

classicallyinstitutionalistperspective,andwithanarrower,21stcenturyfocus.62Elsewhere,a

numberofexcellentworkshavespecificallyunwoundtheinternationalpoliticaleconomyof

regimesurvivalandbudgetsecurityaswell.63Ifslightlyafieldfrommattersofcapitalproper,

theseanalysesneverthelessproffercriticalinsightsintooneofthecentralactorsintheJordanian

economy(thestate)and,coextensively,intothenatureofthefiscalsociologythatisproducedby

thatactor.Concernedwiththeconsequencesmorethanprovenanceofmarketreform,

meanwhile,Andoni,Schwedler,andRyanhaveeachprocesstracedhoweconomicreform

precipitatesresistanceandpopulardissent—andgetsreorientedintheprocess.64

62 See:PeteMoore,DoingBusinessintheMiddleEast:PoliticsandEconomicCrisisinJordanandKuwait.Cambridge

UniversityPress,2004. PeteMoore,“Whatmakessuccessfulbusinesslobbies?BusinessassociationsandtherentierstateinJordanand

Kuwait,ComparativePolitics(33:2),2001. ScottGreenwood,BusinessregimeloyaltiesintheArabworld:JordanandMoroccoincomparativeperspective.

Doctoraldissertation(UniversityofMichigan,1998). ScottGreenwood,“Badforbusiness?EntrepreneursanddemocracyintheArabworld”,ComparativePolitical

Studies(41:6),2007. KatherineBlueCarroll,BusinessasUsual?EconomicReforminJordan.LexingtonBooks,2003. 63 CurtisRyan,Inter-ArabAlliances:RegimeSecurityandJordanianForeignPolicy.UniversityofFloridaPress,2009. LaurieBrand,Jordan’sInter-ArabRelations:ThePoliticalEconomyofAllianceMaking.ColumbiaUniversityPress,

1994.64 See:LamisAndoniandJillianSchwedler,“BreadriotsinJordan”,MiddleEastReport(1996). JillianSchwedler,“ThepoliticalgeographyofprotestinneoliberalJordan”,MiddleEastCritique(21:3),2012. CurtisRyan,JordanandtheArabUprisings:RegimeSurvivalandPoliticsbeyondtheState.ColumbiaUniversity

Press,2018. CurtisRyan,“Identitypolitics,reform,andprotestinJordan”,StudiesinEthnicityandNationalism(11:3),2011.

40

Inmorerecentyears,finally,ahandfulofanthropologistsandgeographershavealsocasta

lightonthemicro-complexitiesofJordan’sneoliberalauthoritarianism.Mostrepresentativeand

mostexemplaryamongsttheseworksarethepublicationsofDebruyneandKreitmeyr.65

ForegroundinganumberofAbdullah-eramegarealestatedevelopmentproject,Debruyne’s2014

dissertationunwindshowneoliberalurbanrenewalnotonlyfacilitatescronyistrentseekingbut

reshapesthestructureandorientationofthestateitselfaswell.66Withaprojectcenteredonthe

ideologicallegitimationofstateandcapital,Kreitmeyr’s2016dissertationscrutinizeshowthe

Palace,transnationalallies,anddomesticbusinesselitespromotesocialentrepreneurshipin

ordertoadvancetheneoliberalprojectinJordan,andwithit,theirclassinterests.67This

sociologicallyrigorousaccountofideology,inconjunctionwithPaulEsber’sandMayssoun

Sukarieh’srespectiveexaminationof(localandinternational)effortsaimedattheinterpellation

ofdutifulneoliberalcitizen-subjectsintheHashemiteKingdomofJordan,offerswonderful

insightsintooneofthekeycogsincapitalism’scontemporaryinstitutionalizationinJordan.68

CurtisRyan,“Peace,breadandriots:JordanandtheInternationalMonetaryFund”,MiddleEastPolicy(6:2),1998.65 Inadditiontothesetwo,IshouldalsomentionJoseCiroMartinez.His“LeaveningNeoliberalization’sUneven

Pathways:Bread,Governance,andPoliticalRationalitiesintheHashemiteKingdomofJordan”(MediterraneanPolitics,22:4,2017),certainlybelongstothistrendofscholarship.

66 PascalDebruyne,SpatialRearticulationsofStatehood:Jordan’sGeographiesofPowerUnderGlobalization.

Doctoraldissertation,GhentUniversity(2013).67 NadineKreitmeyr,NeoliberalNetworksandAuthoritarianRenewal:ADiverseCaseStudyofEgypt,Jordan,and

Morocco.Doctoraldissertation,EberhardKarlsUniversitatTubingen(2016).68 See:PaulEsber,WhoaretheJordanians?TheCitizen-SubjectsofAbdullahII.Doctoraldissertation,Universityof

Sydney(2018). MayssounSukarieh,“Thehopecrusades:culturalismandreformintheArabworld”,PoliticalandLegal

AnthropologyReview(35:1),2012.

41

Aswillsoonbecomeclear,eachofthesepublications—aswellasagreatmanyothers—

havemassivelyinfluencedthismonograph.Thisfactnotwithstanding,oneshouldnotimplythat

theseworksarethereforeflawless,orthattheyhavenotleftconsiderablelacunaewithinthe

field.

Tobegin,thoughmanyscholarsofJordanhavebeenkeentoassertthateconomic

liberalizationhasfailed,orthatcontemporarycapitalismissociallycompromised,theyhave

provenlesseageroradeptinexplainingwhythisisthecase.Analyticallyspeaking,manysuch

workscanbeshowntooverstatethemagnitudeofthereformsthathaveactuallybeen

implemented;tooverinflateand/orunderexplaintheagencyandefficacyofinstitutionslikethe

InternationalMonetaryFundandWorldBank;andtomisattributethecausalandconstitutive

effectsofpolicieslikederegulation,privatization,andcurrentaccountliberalization.Insodoing,

theseworkshavewoundupdistortingand/orneglectingmanyofthekeyprocessesand

mechanismsimplicatedinthecountry’slong-running(andwide-ranging)economicmaladies.

Whenitcomestomoreabstracttheorization,moreover,byultimatelyreducingthesourceof

Jordan’seconomicdistresstoanunderspecified,fuzzilyconceptualizedentityfrequentlycalled

neoliberalism,thesesameworksmuddythefieldinobscurities,leavinguswithouttherigorand

specificityneededtotrulyadvanceknowledge.

Oneneedalsoacknowledgethatthepoliticaltendstobeassignedakindofontological

primacyinmanystudiesontheJordanianpoliticaleconomy,andthatthisassignmentnecessarily

introducesahostofanalyticalproblems.Mostsimplyput,byrenderingthedynamicsofthe

economyitself(andtheactorscontainedtherein)assomewhatderivativeifnotepiphenomenal

—asoutcomesultimatelyproducedbyprocessesofauthoritarianrenewalandregimesecurity,

42

principally—,theseanalysesoverlook/oversimplifythecompetingimperatives,layered

complexities,anddialecticalinteractionsthatdefineJordaniancapitalism.Asitcan(andwill)be

demonstratedthatcontemporaryunderdevelopmentandeconomiccrisisdonotreduceto

processesofauthoritarianrenewalalone,thisoverlooking/oversimplificationconstitutesa

significantmisapprehensionofthephenomenaunderexamination.Whatismore,totheextent

thatauthoritarianrenewalinandofitselfneednotengendersuchoutcomes—totheextent,in

otherwords,thatanalternativepresentcanbeconceivedwithinwhichHashemite

authoritarianismnotonlyproducesaprosperouseconomybutconsolidatesitspoliticalpower

throughthedeliveryofprosperity,aseitherareviewofJordan’sownhistoryoranevaluationof

similarlyperipheralauthoritarianregimestodaywouldbesufficienttoestablish—,italso

constitutesafailureoftheorization.

Finally,itneedbepointedoutthatmanystudiesoftheJordanianeconomyand/orpolitical

economyarealsocompromised,atleastinpart,bytheiracceptanceandimpositionoftwo

separations.Thefirstseparationdividesstatefromcapital.Suchamethodologicalandanalytical

divisionfunctionstoassigneachactor/domainaninappropriatedegreeofautonomyand

independence,inmyestimations,anddemonstratesanignoranceofwhatMitchelllongago

determined:thatthelinebetweenstateandcapitalintheMiddleEast(andinJordan)isnota

“perimeterofanintrinsicentity,whichcanbethoughtofasafree-standingobjectoractor”but

rather“alinedrawninternally,withinthenetworkofinstitutionalmechanismsthroughwhicha

certainsocialandpoliticalorderismaintained.”69Evenifananalystdemonstratedanappropriate

69 TimothyMitchell,“Thelimitsofthestate:beyondstatistapproachesandtheircritics”,AmericanPoliticalScience

Review(85:1),1991,p.90.

43

concernofthelayeredcomplexitiesdiscussedonthepreviouspage,then,weretheytomissthe

internalitybindingandco-constitutingstateandcapitalinJordan,theywouldhavemissedoneof

thecentraldynamicsinthesecomplexities.70

Thesecondseparation,meanwhile,dividesthedomesticeconomyfromtheregionaland

internationaleconomiesthatitembedswithin.Imposinganotherborderwhereitdoesnot

functionallyexist,thisformofmethodologicalnationalismforcesanalyststowranglewithhow

externalprocessesandvariablesactuponJordanratherthandealwithhowtheyactwithin

Jordan.Aseverythingfromthecountry’sclassrelationstoitsdevelopmentpolicymakinghave

beentransnationalizedatthisstage,thisbifurcationoftheinternalfromtheexternalis

necessarilyproblematicaswell.

Asfortheexceptionstothesecritiques,whichitshouldbesaid,arenotfewinnumber,it

neverthelessholdsthatnoneamongstthemhasgrappledwiththetotalityoftheproblematique

thatisattheheartofthisdissertation.Indeed,ifmanyscholarshaverightlydepictedand

explainedthecrisisconditionsthathaveprevailedonandoffinJordansince1989,itnevertheless

holdsthatnoneofthesescholarshavearticulatedathesiscapableofexplainedhowthecountry’s

politicalandeconomicsystemcouldhavereproducedandsurvivedsuchconditionsallthese

years.None,moreover,havescrutinizedthiseconomywiththesamecomprehensivenessasthis

workshall,aworktraversingnotonlypoliticalandeconomicprocessesbutsocial,ideological,

external,andhistoricalonesaswell.Asoneofthefirsttousesocialstructureofaccumulation

70 Thisinternalityisitself,ofcourse,afunctionofhistory(andofintersectingprocessesofclassandstate

formation).ItwillbebroughtintothestarkestofreliefsthroughareviewtheclasscompositionofthepoliticaleliteempoweredunderAbdullah,areviewestablishingthattheelitefractionofthecapitalistclasshaslargelycontrolledthepowersofthestateforthepasttwentyyears.

44

theoryforthepurposesofstudyinganArabeconomy,Ibelievethismonographwilltherefore

constituteasignificantanduniquecontributiontothefield.71

Inaddition,thoughIprimarilypennedthisworkwithaviewtowardsfillinggapsinthe

fieldsofJordanstudiesandMiddleEastStudiesmorelooselydefined,thatoughtnotsuggestthat

myanalysisthereforehaslittletoofferbeyondtheseregionalborders.Iammostexcited,infact,

aboutwhatthiscasestudycanaddtothefieldofcomparativecapitalism.Despitetakinga

numberofenormousleapsforwardintheyearsfollowingSoskiceandHall’sseminalVarietiesof

Capitalism:TheInstitutionalFoundationsofComparativeAdvantage,comparativecapitalismasa

fieldremainsplaguedbyitswestern-centrismatthetimeofwriting.Thisbeingthecase,while

therecentintegrationofmoreheterodoxthinkingandanalysismayrepresentprofound

enhancementsupontheconceptual,classificatory,methodological,andtheoreticalfoundations

firstlaiddownbythetwoscholarslistedabove,suchenhancementshavenecessarilybeen

limitedbythefactthattheyhavebeeninducedprimarilyinreferencetodeveloped,mature

economies.

Certainly,afewscholarsofLatinAmericahavebeenabletopushtheselimitsthroughfirst

introducingin-depthcasestudiesfromtheirregionofexpertise,andthenamendingcomparative

capitalism’sanalyticalframeworkonthebasisoftheirfindings.Unfortunately,however,thesame

cannotbesaidforresearchersoftheMiddleEast.Todate,infact,nosingleworkhasbeen

publishedthatanalyzedaregionaleconomyaccordingtothetermsdevelopedinthefieldof

71 TheoneexceptiontothisisKarenPfeifer.Shecontributedawonderfulchapter(acomparativeanalysisofMENA

economies)totheeditedvolumeContemporaryCapitalismanditsCrises:SocialStructureofAccumulationTheoryforthe21stCentury.

45

comparativecapitalism.Byconsequence,itwouldbenoexaggerationtotosaythatArab

capitalismsare,forlackofabetterterm,outsidethepurviewofoneofpoliticaleconomy’smost

thrivingsubfieldsofresearch.

Withthismonograph,Ihopetobringthisexclusiontoanend,usinganalyticaltools

developedbythesecomparativiststogenerateuniqueinsightsintoJordaniancapitalismasmuch

asIusefindingsfromthiscasestudytorefinethosetoolsthemselves.Foregroundingtheeffects

ofperipheralityandhistory,detailinghowprofitseekingpervadespoliticsjustaspolitics

pervadesprofitseeking,anddisassemblinghowstructuralandproximateprocessesinteractin

generating(andstabilizing)Jordan’sunderdevelopment,Ihopethismonographwillhelpreorient

thestudyofArabandsoutherncapitalismsintonewandproductivedirections.Providinga

roadmapforthoseseekingwaystomorethoroughlyexcavatethelogicofactuallyexisting

neoliberalismalongtheglobalperiphery,Ihopeitmayalsoofferasignificantadditiontothefield

ofcriticaldevelopmentstudiestoo.

46

CHAPTERTWO

Socialstructureofaccumulationtheoryandtheroadahead

Inthischapter,Iwillfirstdetailthetheoreticalandmethodologicalprinciplesthatwill

orientmyanalysisofJordaniancapitalism.AsmanyoftheseprinciplesarederivedfromSocial

StructureofAccumulation(SSA)theory,IwillbeginbyprovidingabriefintroductiontoSSA’s

primarytenets,propositions,andthinkers.Henceforth,IwilldelineatehowIwillbeamending

theSSAframework—througheclecticandwide-rangingborrowings—sotobetterfacilitatethe

thickdescription,processtracing,andabductivegeneralizationthatisattheheartofthiscase

study.Next,Iwillproceedtoachapteroverview.Here,Iwillspecifytheparticular

methodologicalchoicesstructuringeachchapter’sanalysisaswellasthebasicthesesthatthe

readercanexpecttobeadvancedtherein.

SocialStructureofAccumulationTheory

Inductivelyconstructedfromobservationsofadvancedpost-warcapitalisms,Social

StructureofAccumulationTheorywasfirstarticulatedinthelate1970sandearly1980s.Itsearly

pioneers(namelyDavidGordon,RichardEdwards,andMichaelReich)primarilysoughttoresolve

whattheydeterminedtobeaconfoundingfactofthesecapitalisms’existence:namely,thatthey

hadmovedtowardsneitherprosperousstasisnorrevolutionaryrupture.72Seekingaformulation

72 See:TerrenceMcDonough,MichaelReich,andDavidM.Kotz,eds.,ContemporaryCapitalismanditsCrises:Social

StructureofAccumulationTheoryforthe21stCentury.CambridgeUniversityPress,2010,p.1.

47

thatmightsimultaneouslycorrectneoclassicaleconomicsanditssaccharineassumptionsof

equilibriaaswellashistoricalmaterialismanditsassumptionsofinevitabletransformation,SSA

ultimatelyremainedwithinthewiderMarxistfold,thoughdidsowhilecarvingoutnew

conceptualandtheoreticalgroundforitself.73

SSA’sMarxistinheritanceswouldbemostapparentinwhatmightbecalleditsontologyof

capitalism.74Indeed,notonlydidSSAascribecrisistendenciestocapitalistaccumulationinthe

finalinstance;italsoexplainedthesetendenciesthroughreferencetomanyofMarx’sclassic

presuppositions.75Nevertheless,ifacceptingcrisisasbothimmanenttoandconstitutiveof

capitalism,SSAtheoristsdidnottakethenextstepsoastoinvestit(orsocialconflict)withany

degreeofimmediacyorcertitude.Havinggraftedanumberofinstitutionalistpremisesontotheir

ontologicalcore,theywouldinsteadassertthatmaturecapitalismscontainedwithinthema

73 Ofcourse,theywerenottheonlyMarxistsmovingagainstdeterministicanalyses.Onlythemosteconomisticand

dogmaticwerestillclingingtopresuppositionsofimmanentproletarianrevolutionbythetimetheywerewriting.

74 AsMcDonoughetalputit,blockagestoaccumulationwillinevitablyariseundercapitalismdueto“intensifying

classconflict,increasingcompetitioninproductandresourcemarkets,thesaturationofmarkets,oranynumberofothercauses,someofwhicharegeneraltendenciesofcapitalism,whileothersarespecifictoindividualSSAs”(ContemporaryCapitalism…,p.3).

Regardingontologicalpropositions,itisworthnotingthatSSAtheoristsalsoborrowedheavilyfromKeynes,

particularlyinexplainingthenatureofinvestmentundercapitalism.AsMcDonough,Reich,andKotzwriteintheir2010editedvolume,investmentundercapitalismis“subjecttolargefluctuationsduetochangingexpectationsandperiodicimbalancesbetweenthefinancialandrealeconomies,andpronetoself-reinforcingperiodsofstagnationanddepression”(p.2).Thesaliencetheyassignto“changingexpectations”--andtheextenttowhichtheyappreciatehowcollectiveexpectations(evenifhysterical)canalterthefutureofaneconomy—hasclearechoesinKeynes’writingsontheanimalspirits.

75 Specifically,Gordon,RichardsandReicheachacceptedthatcapitalnecessaryengenderssocialconflict,

oversupply,decliningratesofprofit,anddestructiveformsofcompetition,andthateachoftheseoutcomeseventuallygeneratesblockagesintheveryprocessesitrequiresforitsownreproduction.

48

constellationofmechanismscapableofmitigatingand/ormanagingthemovementtowardself-

destruction(ifonlytemporarily).WiththeirsyncretismalsointegratingSweezyandBaran’s

appreciationforthelonguedureeofaccumulationandrecession,thesescholarswoundup

furnishingaunifiedtheorywiththecapacitytoexplainhowboomasmuchasbustcometobe

stabilizedundercapitalisteconomies,societies,andpolities.76

ForSSAtheory,thecausalandconstitutivelogicofstabilization(whetherinboomorbust

times)wasfoundinthefunctionalcoherenceofawiderinstitutionalformationcontaining

political,economic,social,ideological,andexternalcomponents.Suchaninstitutionalformation

wastobeconceptualizedasaneconomy’ssocialstructureofaccumulation.77Asrelatestothe

76 SSA’searlytheoristswereinfluencedbyawidearrayofintellectualpeersandforebearers.Theirbiggest

influenceswerePaulBaran,PaulSweezy,ErnestMandel,EmmanuelWallerstein,AntonioGramsci,MichelAglietta,andRobertBoyer.

Ofnote,earlytheoreticalwritingspositionedthelaborprocessinparticularascentraltoallofthis,positioningcapital’slongtermprofitrateandtheviabilityofthewidersocialformationasafunctionofanSSA’ssuccessin(alternatively)regulating,segmenting,disciplining,and/orco-optingdistinctgroupsofworkers.

See:DavidGordon,RichardEdwards,andMichaelReich,SegmentedWork,DividedWorkers:TheHistoricalTransformationofLaborintheUnitedStates.CambridgeUniversityPress(1982).

Forclarity’ssake,itisworthemphasizingthatSSAmostnotablymarkednewterritorynotmerelyinarguingthat

theseself-destructivetendenciescanbecontained,blunted,andattenuated,atleasttemporarily,apropositionthatwasrelativelyuncontroversialamongstallbutthemostdogmaticofhistoricalmaterialistsbythetimetheywroteit.Ratherit,itwasbyproposingthatthisstabilizationwasafunctionofanintegratednetworkofinstitutionalcontrols,inprovidingamethodologicalandanalyticalframeworkcapableoftestingandconceptualizinghowsuchcontrolsworked,andinadoptingtheFrenchRegulationSchool’sconcernwiththelongdureeofaccumulation(andstagnation).

77 Demonstratingthesamekindoftheoretical,analytical,andideologicaldiversityastheVarietiesofCapitalism

schoolofpoliticaleconomydoes,itshouldbesaidthatscholarsofSSAhavedisagreedonthebasicfunctionofanSSA.OperatingfromaGramscianorMarxianperspective,Bowles,Gordon,andWeisskopffpositedthatanysuchinstitutionalembeddingofcapitalismconstitutedanenhancementofcapitalistpower.Theyevenwentontosuggestthattheprofitrateitselfisadirectfunctionoftherelativepowerthatthecapitalistclassholdsoverothereconomicactors.OthersworkingwithintheSSAframeworkhavearguedthatprofitsandprofitabilitycanbesecuredthroughvariousinstitutionalpermutations,someofwhichmightbecorporatistandbalancedinthedistributionofclasspower,othersofwhichmightmighterrtowardstheliberalmarket,classdominantidealtype.Thisbeingthecase,theconsolidationofanintegratedSSAcanbutneednotimplytheenhancementofcapitalistclasspower.

49

boomtimes,scholarspositedthatanSSA’sinstitutionalcoherence—exemplifiedbytheFordist

andpost-warKeynesianmodalitiesofindustrialcapitalism,forinstance—inauguratesand

consolidatesasystemoflaborrelations,intracapitalrelations,andstate-capitalrelationsthat

buoysinvestmentexpectations,and,withthem,capitalaccumulation.Intheearlyyears,

moreover,theycontendedthatthestabilitytherebyconsolidatedintheaccumulationprocess

wouldfacilitaterapidgrowthandhighprofitratesinparticular.78

Flipsideofthissamecoin,thesetheoristsrecognizedthatthestabilizingpropertiesthat

theyjustattributedtoanSSA’sinstitutionalintegrationwouldholdnotonlyinthegoodtimes,but

inthebadtimesaswell.Sequentially(andderivedfromthetheory’sMarxistontology),theyfirst

recognizedthatadisruption,whetherendogenousorexogenousinitsnature,wouldeventually

beintroducedtotheaccumulationprocess,andthatsuchadisruptionwouldnecessarily

precipitateacollapseinprofitrates.Withinthematerialconditionstherebyestablished,they

proposedthateachinstitutionaldomainofanSSAwouldbelikelytocomeinforinquisition

and/orchallenge.ByconsequenceofanSSA’sintegratednature,moreover,theyalsoproposed

See:SamuelBowles,DavidGordon,andThomasWeisskopf,“Powerandprofits:thesocialstructureof

accumulationandtheprofitabilityofthepostwarUSeconomy”,ReviewofRadicalPoliticalEconomics(18:2),1986.

DavidGordon,ThomasWeisskopf,andSamuelBowles,“Power,Accumulation,andCrisis”,RadicalPoliticalEconomy:ExplorationsinAlternativeEconomicAnalysis.

78 Havingcenteredtheirfocusonthedevelopedcapitalismsoftheglobalnorthbetweenthenineteenthandmid-

twentiethcenturies,thisgeneration’sassumptionsofrapidandhighgrowthrates(duringthegoodtimes)wasfullyreasonable.Extendedboomsandextendedbustscharacterizedthehistoricalmovementfromthelaissez-fairecapitalismofthelate19thcenturytothemonopolycapitalismoftheearly20thcenturytothepost-warKeynesianiteration,afterall.Itwasonlywiththeemergentneoliberalcapitalismthatconsolidatedinthewakeofstagflationthatcapitaliststabilitybecamedisjointedfromrapidcapitalaccumulation.

Thatsaid,followingthestagflationcrisesofthelate1970s-early1980s,thisassumptionofrapidgrowthwould

beditched,asIwilldetail.

50

thattheonsetofacrisiswithinanyoneoftheseinstitutionaldomainswouldbeliableto

“reverberateacrosstheentirestructure.”79Thesecascadingreverberationswouldfurther

unsettletheinvestmentenvironment,ofcourse,entrenching,deepening,andelongatingthe

economy’songoingrecessionorcontractionintheprocess.

Oncearecessionorcontractionhasthuslycommenced,SSAtheorypositsthatalongand

slowcontestshouldbeexpectedtofollow.Herein,differentdifferentactors,classes,andsocial

forceswillstruggletoestablishandcontrolanewinstitutionalformationthatmightbreakthe

economyfromitsstagnationsotofacilitateanewperiodofaccumulationandhighprofits.80

Upontheconsolidationofsuchaformation,theentirecycle—long-runningstability/high

growth→disruptionintheaccumulationprocess→longrunning-instability/recession—will

repeatagain.

Operationallyspeaking,SSAtheory-basedcasestudiesofactuallyexistingcapitalisms

proceededbyfirstdisaggregatinganationalformationintofiveinstitutionaldomains:(1)the

political,(2)theeconomic,(3)thesocial,(4)theideological,and(5)theexternal.81Brokendown

inthismanner,theythenevaluatedthecontentofeachsuchdomainaswellasthesystemof

relationshipsthroughwhichonewasboundtotheothers.Methodologically,studyofthefirstof

79 DavidGordon,“Stagesofaccumulationandlongeconomiccycles”,inTerenceHopkinsandImmanuelWallerstein

eds.ProcessesoftheWorldSystem.SagePublishers,p.17.80 McDonough,Reich,andKotz(2010),p.11.81 SSAholdsthateachinstitutionaldomainretainsitsautonomyvis-a-vistheothersandisorientedbyitsown

particularlogic,incentives,andinterests.Inaddition,itpositsthatacoherentintegrationofalltheseinstitutionaldomainsisrequiredtobuoylong-terminvestmentexpectations,establishsocialcontrolthroughthemitigationofclassconflict(orthenormativizationofoneclass’hegemony)andtherebystabilizetheaccumulationprocess(McDonough,Reich,andKotz,p.3).Inotherwords,“success”inanyonedomainoftheSSAwouldbeinsufficientforstabilizingtheeconomy.

51

thesedomains(thepolitical)requiredascholartodeterminetheprevailingnatureofstate-

societyandstate-citizenrelationsinagivencountryaswellasthenatureofeconomic

policymaking/governance.Studyoftheseconddomain(theeconomic)requiredascholarto

establishtherolethatthestateplayedintheaccumulationprocessaswellastodeterminethe

formofmarketcompetition—whichwasitselfafunctionofasystemofintracapitalandstate-

capitalrelations—prevailingwithinagivenformation.Analysisofthelattertypicallyentailed

mappingmarketstructuresandclassifyingthepowerdynamicsgoverningtheinteractions

betweenfirms.82Studyofthethirdinstitutionaldomain(thesocial)requiredascholartosurvey

andclassifywhatSSAtheoristsconceptualizeascapital’s(orthestate’s)prevailingstrategiesof

socialcontrol.Typically,thisentailedexaminingthenatureoflabor-capitalrelations,labor-state

relations,labor-capital-staterelations,andintralaborrelations,amongstotherlinesofinquiry.83

Lessclearlyconceptualizedthantheothers,studyofthefourthdomain(ideology)requireda

scholartoestablishtheideationalformulationsbeingdevelopedanddisseminatedsoto

legitimateanationaliterationofcapitalism.Studyofthefifthdomain(theexternal),finally,

requiredascholartoestablishwhatiscalledtheexternalarticulationofanSSA.Thiswouldbe

determinedthroughevaluatinghowanationaleconomylegally,institutionally,andmaterially

nestswithinlargerregionalandinternationalsystemsofproduction,trade,andfinance.

82 Regardingthelatter,thistraditionallymeantdeterminingwhethercapitalinteractsandorganizesitselfthrough

monopolisticcompetition,oligopolisticcompetition,laissez-faire,deregulatedcutthroatcompetition,ormutedrivalryandrestrainedcompetition.

Combined,then,thissectionofanSSAanalysistherebyestablishesthecharacterofstate-capitalandcapital-

capitalrelationsinagivencountry. 83 TheFrenchRegulationSchool,fromwhomSSATheoryhasborrowedextensively,conceptualizesthis

constellationofrelationsas“thedeterminantsofthewagerelation.”

52

SSAandtheNeoliberalChallenge

Aswasmentioned,thefirstgenerationofSSAtheoristshadassumedthataproperly

integratedSSAwouldgeneratenotonlystabilityinthegoodtimes,butbothrapidgrowthand

highprofitrates.Whiletheseassumptions,derivedfromobservationsofpost-warcapitalisms

withintheglobalnorth,heldtrueforatime,theywereeventuallyempiricallyinvalidatedby

ExplainingtheFunctionalCoherenceofanSSA IfitisthesuccessfulconsolidationofanintegratedSSA—wherethestructuralintegrityofthewholeis“createdandsustainedbytheinterrelationshipsamongstitscomponentparts”—,thatunlockstheriddleofacapitalism’s(temporary)stability,whatcanexplainthatconsolidationinthefirstplace?IsanSSA’sstructuralintegrityitselfablackbox?Doesithaveanidentifiablepointoforigin?Doesithavesingleormultiplecauses? Intruth,thereisnostrongconsensusamongstSSAtheoristswhenitcomestomanyofthesequestions.Some,likeMcDonough,haveattributedanSSA’sstructuralintegritytoa“unifyingprinciple”,aprinciplethatitselfcanbetracedbacktoeitherasinglecentralinstitution(likeNewDealcorporatism)ortoasingleexogenouscatalyst(likeWorldWarII).ForMcDonough,then,itisuponsuchaunifyingfoundationthatanSSA’swiderconstellationofinstitutionscoalesceembed,orient,andlink.Incontrast,GordonhasborrowedfromAlthusser’sconceptofoverdeterminationinexplainingtheprovenanceofinstitutionalcoherence.DefininganySSAasa“compositewhole...whoseintrinsicstructureamountstomorethanthesumoftheindividualinstitutionalrelationships”,GordonconceptualizesanSSA’sstructuralintegrityasanoutcomethatisfunctionalist,contingent,andmulticausalinnature.RatherthaninvestanSSAwithintentionalityorassignitanidentifiablestewardinthefinal(orinthiscase,initial)instance,Gordonsuggestsitisbetterseenasafortuitouscollisionofhistoricalmovementsoperatingacrossdifferent(andindependent)institutionaldomains.Inasense,then,GordondivergesconsiderablyfromMcDonoughbyconceptualizingoneofthefundamentaltenetsofSSAtheory(itsstructuralintegrity)assomethingdevoidofabigbang,self-awareness,internalhierarchy,orpurposefuldesign. Inanother,however,hedivergeslittlefromMcDonoughinthatanydisagreementoveroriginsdoesnotimplyadisagreementoverthefunctiononeseesanSSAserving(namely,tostabilizeinvestmentexpectations,profitrates,and,thereby,capitalaccumulation).WhileperceivingthecontentsoftheSSAblackboxinamannerdifferenttoMcDonough,then,Gordonisinlock-stepwiththeformerwhenitcomestowhatanSSAdoes.

53

epochalchangesintroducedinthelate1970sandearly1980s.Indeed,upontheconsolidationof

theneoliberalturn,itwouldbeestablishedthattherapidgrowthandhighprofitratesofthe

1950sand1960sreflectedlessageneralizablepropertyofcapitalismandsomethingmoreakin

toahistoricalaccident.84

Likepreviousmodalitiesofcapitalism,theneoliberaliteration—ascendantacrossmostof

theworldfornearlyfortyyearsnow—didunambiguouslymanagetostabilizecapital

accumulation,atleastfortheperiodprecedingtheglobalfinancialcrisisof2007-2008.However,

unlikeitspostwarcomparators,itdidsowithoutalsodeliveringsignificantgrowth.Breaking

withrecenttrends,then,thiswasaversionofstabilitythatwasachievednotthroughexpansion

butthroughanupwardredistributionofwealthandincome.85Institutionalizingasystem

wherebytherentsandgainsaccruingtocapitalconstituteagrowingshareoftotalincome—

wheretheprofitratehasbeendisarticulatedfromeconomicexpansion86—,neoliberal

84 NowherewasthisbetterestablishedthaninThomasPiketty’sCapitalinthe21stCentury(HarvardUniversity

Press,2013).85 GerardDumenilandDominiqueLevy,CapitalResurgent:RootsoftheNeoliberalRevolution.HarvardUniversity

Press(2004),p.2486 MartinWolfsonandDavidKotz,“AreconceptualizationofSocialStructureofAccumulationTheory”in

McDonough,Reich,andKotzeds.ContemporaryCapitalismanditsCrises:SocialStructureofAccumulationTheoryfor21stCentury(2010),p.79.

Asforhowstabilitycouldbeachievedwithoutgrowth,itshouldbenotedthatoverthecourseofthe1990sand

theearly2000s,thereallocationofwealthinstitutionalizedunderneoliberalSSA’sdideventuallyfacilitatearisingrateofprofitincertaincapitalisteconomiesandincertainsectionsoftheeconomy(financeandthebuiltenvironmentinparticular).Thewealthandincometherebyaccruingtothecapitalistclassthroughtheseprofitrateswouldbemorethansufficientforsecuringtheirbuy-in(andinvestment)intothelargerconstellationofsocial,political,economic,andideologicalinstitutionsmakingthisaccrualpossible.Withthisbuy-inconsummatedandthencontinuouslyreaffirmedthroughthisclass’steadyaccretionofprofits,thisglobalSSAmanagedtostabilizecapitalaccumulationandthewiderinternationaleconomywithoutevergeneratinghighgrowth.

54

capitalismshavemarkedareturn,inmanyways,topremodernformsofsocialandeconomic

organization.

Inviewofthesechangesinhistory,WolfsonandKotzintroducedconsiderable,structural

revisionstoSSAtheory.ThemostsalientoftheseconcernedSSAtheory’spositiononeconomic

growth,asissuccinctlyexpressedinthefollowingpassage:

WeunderstandanSSAtobeacoherentinstitutionalstructurethatsupportscapitalist profit-makingandalsoprovidesaframeworkfortheaccumulationofcapital,butitdoes notnecessarilypromotea“rapid”rateofcapitalaccumulation.Thehistoricallinkbetween theSSAtheoryandthetheoryoflongswingsshouldbesevered.87Whereithadbeenassumedthattheconsolidationofacoherentinstitutionalinfrastructure

wouldnecessarilyfacilitatetherealizationofbothhighprofitratesandrapideconomic

expansion,SSAtheoristswouldhenceforthproceedfromthepremisethatrobustgrowthwasbut

oneofthepossibleoutcomesthatmightbegeneratedupontheconsolidationofsuchan

infrastructure.

Beyondnecessitatingthismajortheoreticalreformulation,theemergenceofneoliberal

capitalismsalsoforcedSSAtheorytoundertakeanumberofslightlylessseismicshifts,bethey

analytical,conceptualandmethodologicalinnature.88Tobegin,themodalityofglobaleconomic

integrationusheredinduringthepastfortyyears—onedefinedbytheremovalofcapital

controls,extensivetradeliberalization,andtheinternationalizationofregulatory(andlegislative)

87 WolfsonandKotz(2010),p.7988 ItisworthnotingthatSSAtheoristsofthisgenerationalsodiscernedthetransformativeimpactthat

financialization—andthesegmentationofthecapitalistclass—washavingonaccumulation(WolfsonandKotz,p.84).Moreover,they,likemanyotherobserversoftheneoliberalera,alsorecognizedthiskindofsegmentationtobeespeciallyparticularlypronouncedinthoseeconomicsresemblingtheliberalmarketarchetype.

55

powers89—madeSSAtheory’spreviousdistinctionbetweenaneconomy’sinternalandexternal

articulationsincreasinglyproblematic.Totheextentthattheglobalandthenationalwerenow

co-constitutivedomains,scholarsofpoliticaleconomy(whetheraffiliatedwithSSAornot)would

thereforeneedtorethinkwhatanationalcasestudyoughttolooklike.

LeadingSSA’srethinkingherewereWilliamRobinson,MichaelWallace,andDavidBrady.

Sotoaccountfortheeffectsborneofeconomicopeningandthetransnationalizationofcapitalist

classesthatitfacilitated,Robinson’srevisionsprovidedSSAwiththeconceptualandanalytical

spaceneededtobetterreflecttheshifting(andtransnational)natureofstate-capitalandcapital-

capitalrelationsinthecontemporaryperiod.90WithtracesofRobertCoxandKeesvanderPijl

pervadingandenrichinghisanalysis,Robinson’sinterventionswereasimportantasanyone

else’sinretrofittingSSAforthe21stcentury.WallaceandBrady,meanwhile,introducedanumber

ofrevisionssotobetterequipSSAtheoryformakingsenseoftheevolvingnatureofsocialcontrol

intheeraofneoliberalglobalization.Cognizantinparticularofthedisciplinaryeffectsthat

liberalizedcapitalmovements,footlooseinvestment,andthefragmentationofproductionchains

nowexertedonlabor,theirconceptualinnovationsprovidedtoolsessentialforunlockingthe

dynamicsofcontemporaryindustrialrelations.Withspatialization,forexample,they

conceptualizedhowthethreatoffirmrelocationnowconstitutesapremiummechanismof

powerandleverage,onerenderinglabor’snecessarilylocalizedformsofresistanceincreasingly

89 Bythis,IrefertotheWTO’sgrowinginfluenceovertheregulatorypoliciesofitsmembership—influence

extendingwellbeyondmattersoftariffs,etc.90 WilliamRobinson,TransnationalConflicts:CentralAmerica,SocialChange,andGlobalization.Verso(2003). WilliamRobinson,LatinAmericaandGlobalCapitalism:ACriticalGlobalizationPerspective.JohnsHopkins

UniversityPress(2008).

56

inefficacious.91Forcinglaborbothtocompeteforcapitalandtooperateundertherulesandlogic

ofsuchacompetition,spatializationhelpscapturehowthespecterofcapitalflightcansecurea

highlyhierarchicalformofsocialpeace/domination.

RevisingSSAfortheJordanianContext

Notwithstandingthesescholars’wonderfulcontributions,asmentioned,Iwillbeaddinga

numberofmyownrevisionstotheanalyticalframeworksthathavebeendevelopedaroundSSA’s

theoreticalpresuppositions.ThoughIamconfidentintheexplanatorypowerofsocialstructure

ofaccumulationtheorymoregenerallyandintheconceptualizationsonoffertherein,Ibelieve

thatafewtweakstoanotherwiseSSA-groundedanalysiswillbetterequipmetogenerateunique,

robust,andconvincinginsightsasregardstheenduranceofJordan’scapitalismofcrisis.

Hearkeningbacktoapointtouchedonintheintroduction,myrevisionsareprimarily

informedbythefactthatinJordan(asinmuchofthedevelopingworld),thereexistsno“sharp

antinomy”betweeneitherstateandcapitalorthenationalandtheinternational.92Specifictothe

state-capitalrelationship,theabsenceofsuchanantinomyisafunctionofhistoryandof

91 MichaelWallaceandDavidBrady,“Spatialization,foreigndirectinvestment,andlaboroutcomesintheAmerican

states,1978-1996,SocialForces(79:1),2000,pp.67-105. MichaelWallaceandDavidBrady,“GlobalizationorSpatialization?TheWorldwideSpatialRestructuringofthe

LaborProcess”inMcDonough,Reich,andKotzeds.ContemporaryCapitalismanditsCrises:SocialStructuresofAccumulationTheoryforthe21stCentury(2010),pp.121-144.

92 Formoreonthispoint,see:AdamHanieh,CapitalismandClassintheGulfArabStates.Springer(2016),p.25. InJordan’scase,theabsenceofsuchanantinomyislargelyafunctionofbothsocial/politicalhistory(i.e.

processesofclassandstateformation)andofglobalperipherality.

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interpenetratedprocessesofclassandstateformationinparticular.Aswillbedemonstrated,the

Hashemitestatewaspartiallyconstitutedasatoolof(capitalist)classpoweratthetimeofits

inception.Inversely,theJordaniancapitalistclassasmuchasthehierarchicallinesof

segmentationthatempoweritselitefractionwerealsolargelyconsolidatedthroughthe

patternedinterventionsofthestate.Byconsequenceofthisco-constitutiverelationship,thereis

nowayofmakingsenseofstateinterventioninthecontemporaryJordanianeconomywithout

dealingwithquestionsofclassjustasthereisnowayofdealingwithtoday’scorruptedmarket

competitionwithoutdealingwiththeinterestsandprerogativesofthestate(andthepalacein

particular).Similarly,onecannotgrapplewiththeelitefraction’sacutepredispositiontowards

rent-seeking—oneofthemostsalientandinfluentialpropertiesofthecountry’scontemporary

capitalism—withoutfullyinvestigatingthecoimbricationofclassandstateformationinJordan,

bothhistoricallyandinthepresentday.

Specifictothenational-internationalrelationship,theabsenceofsuchanantinomyisa

functionofthestateandtheeconomy’sexternaldependency.Eachofthesepropertiesthemselves

derivefromtheintersectionofpolicymakingandglobalperipherality.Regardlessofprovenance,

thistwo-folddependencyhasshiftedandinternationalizedeverythingfromthenationalclass

structuretothecompositionofthestatetothenatureofthedomesticmarketinJordan.93Asthe

international’sinternalityvis-a-visthenationalnecessarilycollapsesthepartition(analyticalor

otherwise)betweentheexternalandinternalarticulationsofJordan’ssocialstructureof

93 IndicatorsofthisdependencyareapparentinthestructureofJordan’straderelations,intheshareofthecapital

stockthatisownedbynon-nationals,andinthestate’sstructuralrelianceupondevelopmentassistance,budgetaryassistance,foreignaid,andhumanitarianstateswithinthestate.

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accumulation,dependencyrendersSSA’sunderstatedmethodologicalnationalism—implicitin

theassumptionofaseparationbetweenthosetwoarticulations—non-viableforthepurposesof

thiscasestudy.Justasonecannotappraiseeliterent-seekinginJordanwithoutconsideringthe

state,then,onecannotevaluatethiscapitalism’sfiscalsociology,regimeofsocialcontrol,political

institutionalizationortradeperformancewithoutconsideringtheinternational/transnational.

Operationally,IwillamendSSA’sanalyticalframeworksotoaccountforthesenon-

antinomiesinanumberofways.Regardingstate-capitalrelations,Ihaveincludedafargreater

emphasisthanistypicalonhistoricalprocesstracingsotoestablishthefullempiricalvalidityof

theclaimsputforthonthepreviouspage.Insubsequentlyanalyzingeachindividualdomainof

thecountry’scontemporarySSA,Ihavealsomadespacetountanglethewebofpersonnel,policy,

andinstitutionsthroughwhichcapitalactsviathestate(andviceversa).Thisspacewillbe

evincedinmyanalysisofAbdullah’spoliticalknightingofthebusinesseliteintheearly2000sas

muchasinmyanalysisoftheideologicalcampaignsthathavebeenlaunchedinhopesof

legitimatingneoliberalcapitalism,andthedialecticalunionofstateandcapitalwillbeshownto

constituteoneofthemostsalientpropertiesofJordan’ssocialstructureofaccumulation

throughout.

Iwillincorporatedependencyandperipheralityinasimilarlycomprehensivefashion.In

interrogatingthepoliticalinstitutionalizationofJordaniancapitalism,forinstance,Iwillnotonly

appraisehowbudgetaryimperativesandcreditorrelationsinfluencegovernanceandeconomic

policymaking;Iwillalsodocumenthowexternalorganizationsandforeignconsultantsmore

directlypervadeJordan’slegislativeandregulatoryprocesses.Iwillaccountforperipheralityand

dependencyinmyanalysesofbothmarketcompetitionandofthestate’scontemporary

59

modalitiesofeconomicintervention,meanwhile,bydemonstratinghoweachinstitutional

domainiseffected(ifnotconstituted)bythehegemonyofGulfcapital.Indiscussinghistorical

andcontemporarysocialcontrolstrategies,Iwillconnectperipheralitytoimmigration

patterns—patternsthatwillinturnbeshowntoexertasubstantivedisciplinaryeffecton

domesticlabor.Evenindiscussingideology,Iwillshowhowperipheralityanddependency

reorientdescriptiveandnormativeclaimmakingtowardsexternalaudiences.

IbelievetheserevisionswillnotonlyenhancethequalityofthiscaseJordaniancasestudy,

butalsoprovideatemplateofsortsforothersaimingtobetterunderstandeconomiclifeinthe

globalsouthmoregenerally.

ResearchMethodsandTheoryGeneration

Atthemostmetaoflevels,thissinglesubjectcasestudyusesthickdescriptionin

conjunctionwiththeabductivetheoryofmethodtodevelopgeneralizableclaimsasrelatesto

southerncapitalisms,actuallyexistingneoliberalism,andcontemporaryeconomicdevelopment.

Lessabstractlyspeaking,thisentailsfirstdetectinganddocumentingasurprisingempirical

phenomenon—namely,Jordan’scapitalismofcrisis.Henceforth,abductivereasoningispracticed

toinferthebestexplanationforsuchthisparticularphenomenon.94Then,throughconversation

94 “Best”isappraisedbaseduponlogicalcoherenceandempiricalvalidity. Formoreontheabductivetheoryofmethod,see:JoReichertz,Abduction:TheLogicofDiscoveryofGrounded

Theory.Sage(2007). JaniceMorse,PhyllisStern,JulietCorbin,BarbaraBowers,KathyCharmaz,andAdeleClarke,Developing

GroundedTheory:TheSecondGeneration.Routledge(2016). BrianHaig,“Anabductivetheoryofscientificmethod”,PsychologicalMethods(10:4),2005,pp.371-388

60

withaseriesoftheoreticalpresuppositionsdrawnfromreadingsofheterodoxeconomics

(including,ofcourse,socialstructureofaccumulationtheory),Ideriveaseriesofpropositions

aimedatrefiningand/oraugmentingknowledgeonthetopicslistedabove.Thesepropositions

willbediscussedatlengthinmyconclusion.

Operationally,mydetectionanddocumentationofthesurprisingempiricalphenomenon

attheheartofthisanalysishasrelieduponamixed-methodsapproach.Borrowingeclectically

andwidely,thesequantitativeandqualitativetoolsprovidedthedexterityanddiscernmentthat

wasrequiredtoensurethatIcouldgatherandprocessthediversityofdatainputsneededin

ordertoanalyzeeachoftheinstitutionaldomainsconstitutingJordan’ssocialstructureof

accumulation.Dependingonthechapterandtheparticularproblematiquetowhicheachchapter

isanchored,Ihavespecificallycalleduponthefollowingresearchmethods—oftenincombination

withoneanother—drawnfromacrossthefieldsofpoliticalscience,sociology,economics,and

history:(a)comprehensiveliteraturereviewforthepurposeofhistoricalprocesstracing;(b)

longitudinalstatisticalanalysisforthepurposeofevaluatingnationaleconomicperformanceand

attributingcausaleffectstospecificpolicies;(c)contentanalysisforthepurposeofevaluating

legislation,policyinitiatives,andtradeagreements;(d)classanalysisforthepurposesof

evaluatingthesocialcompositionofeconomicandpoliticalpower;(e)criticaldiscourseforthe

purposesofevaluatingpoliticalspeechandideologicaltexts;(f)analysisofpublicopinionsurvey

dataforthepurposesofevaluatingideology’seffects;(g)longitudinalstatisticalanalysisderived

fromfirm-leveldataforthepurposesofevaluatingbookvaluesandmarketcompetitionacross

time;(h)assetvaluationandassetdeterminationtoevaluatetheeconomicpowerofselectfamily

owned-conglomerates(forthepurposesofevaluatingmarketcompetition);(i)quantitative

61

mappingofsectoralstructures(forthepurposesofevaluatingmarketcompetition);and(j)

statisticalanalysisofinvestorequityamongstpubliclytradedfirms(forthepurposesof

evaluatingmarketcompetition).

Together,Ibelievethesemethodshaveprovensufficientwhenitcomestobothdata

extractionanddataappraisal.Byextension,Ibelievetheirselectionwasappropriateforand

conduciveofcausalandconstitutiveinferencegenerationaswell.

ChapterOutlines

Thisdissertationwillbedividedintotwosections.Thefirstsectionismeanttoprovidethe

readerwithanhistoricaloverviewofJordan’ssocialorganizationandpoliticaleconomy.

Informedbyacomprehensivereviewofthescholarlyliterature,thethreechapterscomprising

thissectionwillmapoutthegeneralcontoursofthecountry’ssocial,political,andeconomic

developmentfromthemiddleofthe19thcenturythroughthedeathofKingHusseinin1999.

Proceedingsequentially,thefirstchapterinthissection(Chapter3:APreamble:Jordan

beforetheMandate,JordanduringtheMandate)willsketchprocessesrelatedtoclassandstate

formationandcoveraperiodroughlystretchingfrom1850through1945.Chapterfour

(IndependentJordan’sFirstSocialStructureofAccumulation:1946-1973)willtakeupwiththe

post-independenceyearsandprovideadetailedexaminationofthesocialstructureof

accumulationthatprevailedbetween1946and1973.Chapterfive(Oil,InducedStateRentierism,

andaNewSocialStructureofAccumulation:1973-1986)willaddressthesocialstructureof

accumulationthatemergedinJordanfollowingtheruptureoftheOPECoilembargo,a

petrodollar-fueledformationthatlargelyheldfirmupandthrough1989.Thischapterwillalso

62

detailthecollapseofthisSSAaswellastheresultingcontractionturnedrecession.Indelineating

theinheritancethathistorybestoweduponKingAbdullah,ayoungmonarchwhorather

unexpectedlycametopowerattheturnofthemillenium,itismyhopethatsectiononewillequip

thereaderwiththecontextneededtomakesenseofthedynamicscoveredinsectiontwo.

SectiontwoofthisdissertationwillfocusonthecontemporaryJordaniansocialstructure

ofaccumulation(1999-2019).Chaptersix—Politics,PolicyMaking,andtheInstitutionalizationof

NeoliberalCapitalism—willtracecontemporarycapitalism’slegislativeandjuridicaloriginstoa

seriesofautocratic-technocraticinitiativesinauguratedbyKingAbdullahovertheprevious

twentyyears.Proceedingsequentially,thisgenealogyofthepresentwillbeginwiththeEconomic

ConsultativeCouncil.Itwillbeshownthatthispalaceappointeddefactoparliament—stewarded

byacoterieofeconomizedelitescollectivelyidentifiedasGenerationAbdullah95—unilaterally

rewrotethemajorityofJordan’sindustrial,investment,trade,laborandregulatorypolicies,

authoringanewformofcapitalismintheprocess.96Next,IwillturntotheAqabaSpecial

EconomicZoneAuthority(ASEZA),anotherorganizationallyautonomousandintentionally

insulatedpolicymakingbodythatwillbedemonstratedtohavehadasimilareffectwithinthe

95 UnlikethepoliticalelitesempoweredduringHussein’stenure,anetworkofmenwho,nomattertheirfaults,

couldatleastbesaidtohaveretainedcommitmentsandconnectionstoawidersocialbase,IwilldemonstratethatAbdullah’skingsmen—drawnalmostexclusivelyfromatransnationallyorientedfractionoftheJordanianbourgeoisie—havenosuchtethering.Incontrasttotheirpredecessors,IwillalsodemonstratethattheyhavesoughttoadvanceanagendathatisexplicitlyantagonistictotheinterestsofJordan’svastmajority(includingitsbureaucrats).Byconsequenceofthesetwofactsandofthefactthatthesebusinessmenturnedpolicyeliteswerenotcreaturesofthestatethemselves,itwillbecomeclearwhytheimplementationoftheiragendarequiredtheestablishmentofahostofnewparallelpolicymakinginstitutions—i.e.theautocratic-technocraticinitiativesjustdiscussed.

96 AsIwillalsoshow,manyoftheindividualsempoweredintheseroyally-alignedinstitutionswouldlaterbe

appointedtoministerialpositionsingovernmentsotoinsurethepoliciestheyhaddrawnupwereimposedinasuitablemanner.

63

localcontextofsouthwestJordan.Finally,IwillclosewithananalysisoftheMunicipal

GovernmentofAmmanunderOmarMa’ani’sleadership,documentinghowhisautocratic-

technocraticgovernance—aidedandabettedbyforeignconsultants—furtherconsolidateda

capitalismbiasedtowardslowgrowth,elite-domination,andspeculationinthebuilt

environment.97Evincinghowthepalacehasbeendisembeddedfromthestateasmuchasthe

markethasbeendisembeddedfromsociety,thischapterwillrevealhowthepoliticalverymuch

investscontemporaryJordaniancapitalismwiththecrisistendenciesthatweredescribedinthe

introductiontothismonograph.

Ifchaptersixcoversthelegislativeandpolicyprocessesrelevanttotheestablishmentof

neoliberalcapitalism,chapterseven—TheMakingandManagementoftheEconomy:The

State/PalaceintheEconomy—willturnthelensontothedirectinterventionsthatthestateand

palacehavetakenintheeconomyoverthepasttwentyyears,demonstratinghowthese

interventionstoofunctionsotoinstitutionalizeandstabilizeanelite-oriented,socially

disembeddedmodalityofcapitalism.Iwillbreakthisanalysisintotwosubsections.Thefirstwill

focusinonwhatIwillconceptualizeasthestate’smass-orientedinterventions.Herein,Iwill

foregroundtherolethat(retreating)welfarismhasplayedinstabilizingcapitalaccumulation

(andindestabilizingmiddleandworkingclasslife)duringthetenureofAbdullah.98Withinthis

97 Investedwithtotaldiscretion,Iwillshowthatthistechnocraticpolicymakingoperatesoutsidethetraditional

apparatusesofthestateandthereforeoutsidethepatronagesystems,distributiverationalities,andwelfaristcommitmentsthatthestatehastraditionallybeenhostto.

98 Specifically,Iwillconsiderthesocialandeconomiceffectsgeneratedthroughpublichealthexpenditures,the

cancelationofuniversalsubsidies,andthestate’sprivilegingoftargetedtransfersinitspovertyalleviationoperations.Inaddition,Iwillexaminehowamoregeneralizabledeclineinthequalityofpublicserviceprovisionshasstressedmiddleandlowerclassfamilies—forcingthemtoborrowandspendgreatersumsonhealthandeducation—,andhowthesestressorsrelatetosocialinstability.

64

widerlineofwelfaristinquiry,Iwillalsotakeheedtoemphasizethegenerationaleffectsthat

relativedeclinesinpublicsectorhiringhavehadoverthelasttwentyyears—anddocumentthe

extenttowhichthesocialimpactofdirectstateemploymenthasdeclinedunderthecurrent

King.99

ThesecondsubsectionwillnarrowinonwhatIwillconceptualizeasthestate’selite-

orientedinterventions.Herein,Iwillbeginwithananalysisofthefiscalsociologythathasbeen

consolidatedunderAbdullah’swatch.Attheaggregatelevel,Iwillshowthatthissociologyisnot

onlyregressive,punitive,andeconomicallyinefficient,butthatitisalsoconduciveofupwardand

outwardredistributionsofwealth.100Henceforth,Iwillproceedtoconsidersixadditional

mechanismsofelite-orientedintervention:(1)privatization;(2)themanipulationofcurrent

accountliberalization;(3)theinstrumentalizationofpubliccreditinstitutionsforthepurposesof

boostingelite-ownedenterprises;(4)real-estateorientedindustrial/investmentpolicies;(5)

laissez-faireindustrialpolicies[asimplementedacrossJordan’sQualifyingIndustrialZones(QIZ),

SpecialEconomicZones(SEZ),andSpecialDevelopmentZones(SDZ)];and(6)militaryindustrial

policies.

Chaptereight—InstitutionalizingOligarchy:TheJordanianFormofMarketCompetition—

willaddressthenatureofcapital-capitalrelationsandmarketcompetitioninJordantoday.This

99 Inaddition,Iwillalsoshowthatpublicsectorhiringtodayremainsdetachedfromconsiderationsofmerit;this

beingthecase,IwillalsodocumenttheextenttowhichthisareaofpublicexpendituresiscompromisedbymuchthesameissuesaswereseenduringHussein’spost-1973years.

100 Morespecifically,IwilladdresstheemphasishehasputontheVAT,hisregime’sdefactoneglectofcorporateand

incometax,thetaxbreaksprovidedacrossJordan’smanyspecialeconomicanddevelopmentzones,thepervasivenessoftaxevasion,andtheeffectsthatissuingdomesticbondstolicensedbanksalonehavehadonthestate’sfiscalsociology.

65

analysiswillalsobebrokenintofoursubsections.Inthefirst,Iwillreviewthemodalityofstate-

capitalrelationsestablishedunderAbdullahanddiscusshowthisrelatestotheconsolidationof

Jordan’soligarchicmarkets.Insectiontwo,Iwilllinkclasshistorytotoday’smarketcompetition,

foregroundinghowthefracturingandhierarchizingofthecapitalistclassalsoinformssub-

optimalmarketperformance.Insectionthree,Iwillbrieflydiscussthefinancializationofthe

economyandhowthehegemonyoffinancialcapitalcontributestoanti-competitivedynamics.In

subsectionfour,finally,Iwilldisaggregatetheeconomyonasectorbysectorbasis,usinga

quantitativeanalysistomaptheoligopolisticmarketstructuresorganizingcontemporary

competition.

Chapternine—SocialControlUnderAbdullah—willexplorethelogicthroughwhichthis

deeplyinefficientandcorruptiterationofcapitalismmanagestostaveoffpopularrevolt.This

analysiswillbebrokenintofoursubsections.Inthefirst,Iwilldetailthelegal-coerciveaspectsof

contemporarysocialcontrol.Inthesecond,Iwillfocusinonthe(domesticandtransnational)

segmentationofthelaborforceandconnectthistothestabilizationofelite-oriented

accumulation.Inthethird,Iwillturntotheproliferationofmicro,small,andmedium-sized

enterprisesanddiscusshowtheyhaveproblematizedthemobilizationofworkersolidarity.

Finally,inthefourthsubsection,Iwilladdresshowthegeneralizedprecarityofthepopulation

mayalsocontributetosocialcontrolinthecontemporaryperiod.

Chapterten—Peripherality,Dependency,andtheExternalArticulationofJordanian

Capitalism—willconsidertheregionalandinternationalintegrationofJordaniancapitalism.This

analysiswillbebrokenintotwosubsections.Inthefirst,Iwillconsiderthejuridical

institutionalizationofeconomicopening.AsIwillhavealreadycoveredsomeaspectsofthis

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institutionalizationinpreviouschapters—principally,thecountry’simmigration,investment,and

industrialpolicies—,thisanalysiswillprimarilyemphasizetheparticulareffectsborneoftrade

andbudgetpolicy.Herein,Iwillprocesstracetheeconomicconsequencesyieldedbythe

country’saccessiontotheWTO,itssigningofhighlyinfluentialbilateraltradeagreements,andby

thestate’senduringdependenceonexternalbudgetarysources.101

Insubsectiontwo,IwillconsidertheconsequencesproducedbyJordan’sveryparticular

modalityofeconomicopening.Herein,Iwillhighlightandexplainfoureconomicoutcomesthat

arespecificallyrelevanttocontemporaryunderdevelopment.Thefirstconcernsthecountry’s

decliningtermsoftrade.Narrowinginontheexportsideoftheledger,thesecondconcernsthe

decliningsophisticationofJordan’sexportbasket.Directlyrelatedtoinvestmentpolicydecisions,

thethirdconcernstheeffectsoftheGulf’scolonizationofJordan’sdomesticcapitalstock,andwill

emphasizehowGulf-originatingFDItendstowardsnon-productivesectors,therebyundermining

industrialdevelopmentandtechnologicalconvergencealike.Bringingimmigrationpolicytothe

fore,thefourthwillexplainhowbraindrainhasbeeninstitutionalizedthroughthecollaborations

ofstateandcapitalistclassinJordan.

Chaptereleven—LegitimatingNeoliberalism:Inward/OutwardFacingIdeologyandthe

JordanianSSA—willcoverthematerialanddiscursivepracticesdesignedtonormativelyembed

contemporarycapitalism(anditsHashemitesponsors).Herein,Iwilldetailfourmasterscripts

101 Specifically,IwillbeexaminingtheJordan-UnitedStatesFreeTradeAgreement(JUSFTA)andtheEUAssociation

AgreementonJordaninconsiderabledetail.ThoughIwillalsotouchonahandfulofregionaltradeinitiativessuchastheGreaterArabFreeTradeAgreement(GAFTA),asthesehavebeenmuchlessimpactfulinpractice,theywillnotbegivenprideofplace.RegardingGAFTAforexample,thoughitwasmeanttoeliminateallimpedimentstotradeasof2005,extensivenon-tarifftradebarriersremaininplaceacrosstheregion,andintraregionaltraderemainsquitelowasaresult.

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mostcentraltothisideologicalprojectaswellastheinstitutionsandactorsthatareinvolvedin

theirarticulation:(1)TheFetishizationofGlobalization;(2)Thedepoliticizationofthe

governance102;(3)Thelionizationoftheentrepreneur;and(4)TheInterpellationofthe(social)

EntrepreneurastheIdealCitizen-Subject.

Finally,inthedissertation’sconcludingchapter,Iwillreviewthecentralthesesanchoring

thiswork,discussmattersofgeneralizationandthecontributionsthiscasestudycanmaketothe

fieldofcomparativecapitalism,andprobeavenuesforfutureresearch.

102 IntracinghowthePalacehasdefineditsself-styledtechnocracythroughnegation—throughfirstascribing

ontologicalcorruptiontothestate,etatisme,politicalpartiesandthepoliticalandthencastingtheKing,hisinsulatedpolicymakers,andthebusinessclassastheirantithesis—,IwilldemonstratehowtheideologicalcomponentoftheSSAinfusesandreinforcescapitalism’ssocial,political,andeconomicinstitutionalization.

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SECTIONONE

Jordan’sSocialStructuresofAccumulationinHistoricalPerspective

69

CHAPTERTHREE

APreamble:JordanbeforetheMandate,JordanduringtheMandate

ManystudiesoftheJordanianpoliticaleconomydepicttheperiodpriortotheBritish

arrivalasapremodernkindofether.103ThisconstructionofaBedawiterranulliusisproblematic

foranumberofreasons,firstamongstthemthatitnecessarilyattributesacreationisttypeof

historicalagencytothesubsequentadventoftheboththeBritishandtheHashemites.Itisalso

problematicforthefactthatitobscurestheprovenanceofJordan’scontemporaryclasssystem.

Giventhattheproto-consolidationofthebourgeoisieinthelate19thandearly20thcentury

precededandtherebyshapedtheformationofthestate,thisobscurationisevenmore

consequentialthanmightfirstappear.104

Sotoavoidmakingthesameerror,thispreamblewillintroducethereadertoanumberof

keysocial,political,andeconomicdevelopmentstranspiringwithinTransjordanduringthelate

Ottomanperiod.Henceforth,itwillbrieflysurveyboththeprocessesthroughwhichtheBritish

MandateoverTransjordanwasestablishedandtheprocessesthroughwhichtheHashemite

familyeventuallystakeditsclaimastheMandateauthority’sindigenouspartner.Ofnote,the

analysisinthischapterwilldifferfromtheanalysesfeaturedinthisdissertation’sotherhistorical

103 Notonlydothesestudiesinflatetheroleofthestateinconstructingtheeconomy;bysubsumingtheHashemite

Kingswithinthestate—inmakingtheMonarchyandtheemergentbureaucracyaunifiedactor—,theseanalysesalsoobscurehowthePalacehas,inpursuingitsowninterests,consistentlyunderminedthatbureaucracyandtheformationofarationalizedstate,asIwilldetail.

104 NowhereisthisahistoricismmoreapparentthaninPiro’s1998bookThePoliticalEconomyofMarketReformin

Jordan.Intheintroductiontothiswork,PiroassertsthatinJordan,thestatepreceded(andbyimplication,created)thenationaleconomy(p.6).Thisself-sufficientfactishighlyproblematic,asthefollowingpageswilldetail.

70

chaptersinthatitwillnotbearrangedaccordingtotheframeworksofsocialstructureof

accumulationtheory.DesignedsotoacclimatethoseunfamiliarwithJordanianhistorytothe

basiclayofthelandratherthansotoprovideacomprehensiveanalysisofcapitalism’ssocial,

political,andideologicalinstitutionalizationinthelate19thandearly20thcenturies,Ihopethe

readerwillnotfindthistoodisorienting.

…...…………..……..……..………..........……...........................……..….........….…….…...…………...…….….....………...…………

Inthemid-1800s,thelandsthatwouldlaterconstitutetheBritishMandateofTransjordan

hostedformsofsocialandeconomicorganizationthatinmanywaysresembledwhatwasseen

elsewhereintheArabMashreq.AswasthecaseinSyria,Palestine,andLebanon,the

Transjordanianeconomywasitselflargelydependentuponlongdistancetrade,derivativesofthe

annualhajj(i.e.caravanraiding),camelpastoralism,andsubsistenceagriculture.105Ifsharingin

suchgeneralizedproperties,however,TransjordandivergedfromitsLevantinepeersintwo

(intersecting)regards.First,duetotheintensityoftheclimate’saridity106,thecontingent

historiesofregionalempires,theacutepervasivenessoflocalBedouinraiding,andtheabsenceof

105 ThisarchetypewasdevelopedbySamirAmininUnequalDevelopment. Thoughcorrespondingimperfectlywithanyanalyticalarchetype,Transjordancouldbesaidtoapproximatea

poortributesocialformationintheseyears,onewherethe“centerofgravitywasthetownratherthanthecountryside.”

See:Mohammaedal-Masri,TheJordanianBourgeoisieCompositionandStructure1967-1989.Doctoraldissertation,DurhamUniversity(2005),p.85.

106 Regardingthepointonaridity,withtheexceptionoftheGhorregionandtheeasternhighlands—thelands

betweentheYarmoukRiverandtheSyrianbordersinthenorthandWadiMusainthesouth—,approximately91%oftheTransjordanianlandmasswasunsuitableforagriculture.Receivingunder200millimetersofrainfallperyear,TransjordanwouldthereforeseelittleofthegrainproductionpoweringmuchofSyria’s19thcenturycapitalaccumulation.

See:Masri,p.85andOddvarAresvik(1976),TheAgriculturalDevelopmentofJordan,p.58-60

71

aMediterraneancoastline,thearea’surbancenterswererelativelyunderdevelopedascompared

tothoseseenelsewhereintheMashreq.107Second—andagainduetoboththeclimate’saridity

andthepervasivenessoftheraidingeconomy—,Transjordan’sagriculturalbasewas

comparativelyunderdevelopedaswell.108Ifstillprovidingthematerialconditionsneededforthe

reproductionofsettled,nomadic,andsemi-nomadicwaysoflife,Transjordan’sprecariousfood

suppliesandlimitedeconomicsurplusallowedforneithersubstantialpopulationgrowthnor

capitalaccumulation.

Asregardsthepoliticalrealitiesoftheday,whilenominallyunderOttomancontrol

throughoutthe19thcentury,thelandsofTransjordansawlittleinterferencefromtheirimperial

overlordspriorto1850.OperatingoutofanadministrativecapitalinDamascusatmid-century,

logisticalchallengesandalackoffinancialincentivessawtheOttomansdevotelittleeffortor

resourcestoextendingtheirpresencebeyondtherelativelyfertileAjlunregionofnorth

Transjordan.Thisnegligenceanddisinterestdideventuallygiveway,however,onceamore

interventionistadministrationinIstanbultookaninterestinextractingpredictabletaxreceipts

fromitsMashreqiansubjects.Adoptingavarietyofmeansinserviceoftheseends—thebuilding

andstaffingmilitarygarrisons,theimplementationoflandregistrationthrough1858’sOttoman

107 Transjordan’scitiesandtownsweresignificantlylessprosperousthaneitherinteriortradingdepotslike

DamascusandAleppoorsea-trading,western-orientedportslikeHaifa,Jaffa,andBeirut.108 Forcedtonavigatethewhimsicalityofecologicalconditionsandbedouinpredations/impositionsoftributealike,

throughoutmuchofthe19thcentury,Transjordan’speasantrytendedtoconsistentlyrelocateandtorelyonmoreprimitivetoolsofcultivation(lesttheircapitalbeseizedbytheBedouin).

Formore,see:NormanLewis,“TheFrontierofSettlementinSyria,1800-1950”inCharlesIssawi(ed.)TheEconomicHistoryoftheMiddleEast1800-1914.UniversityofChicagoPress(1955),pp.259-264

MustafaHamarneh,SocialandEconomicTransformationofTrans-Jordan1921-1946.Doctoraldissertation,GeorgetownUniversity(1985),pp.79-80.

72

LandLaw109,theencouragementofsemi-sedentarizationamongsttheBedouin,the(forced)

settlementofCircassianmigrantsinAmman,Jerash,andZarqa,the(forced)resettlementofArab

ChristiansinKarakandMadaba110—,therevenue-drivenextensionoftheOttoman

administrativestatewouldconstituteacriticaljunctureinTransjordanianhistory,catalyzing

processesofeconomicdevelopmentandcapitalistclassformationthatprovedtobeofgreat

subsequentimportance.111

Tobegin,theextensionoftheOttomanstateandtherelativesecuritythisextension

oversawfacilitatedTransjordan’sintegrationintonetworksoftradeandcommercebasedinthe

Syrianinterior—networkswhichTransjordanianresidentshadpreviouslylackedaccessto.112

Thisproto-regionalintegrationaloneprecipitatedatransitionfromsubsistenceagricultureto

export-orientedagricultureinTransjordan,withmassiveincreasesintheexportofwheat,

cereals,barleyandfruitsachievedhenceforth.113Perhapsevenmoreimportantly,thebuildingof

OttomangarrisonsalsofacilitatedtherelocationofSyrianandPalestinianmerchantsinto

Transjordan’semergenttrading(andsmuggling)centers.Nolongerasvulnerabletothecaravan

109 ThenatureandsocialeffectsoftheimpositionoftheOttomanLandLaw(asitinteractedwithpre-existing

systemofmasha’a,miri,andprivateproperty)aresubjecttosomescholarlydebate.Forareview,see:MichaelFischbach,State,SocietyandLandinJordan.Brill(2000)

110 RegardingOttomansettlementpolicy,see:EugeneRogan,IncorporatingthePeriphery:theExtensionofDirect-Rule

overSouth-EasternSyria(Transjordan).Doctoraldissertation,HarvardUniversity(1991).111 RegardingthisstageofJordanianhistorymoregenerally,see:TariqTell,TheSocialandEconomicOriginsof

MonarchyinJordan.Springer(2013),pp.42-43.112 See:Masri(2005),pp.87-114.113 Togetherthoseproductscomprised75-90%ofTransjordan’stotalexportsatthisstage.See:Knowles(2001),

p.86.

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raidingoftheBedouin,thisarrivalofNablusi,Jerusalemite,andDamascenecapitalfurther

expeditedandacceleratedtheagriculture-drivengrowthalreadyunderway.

Introducinglevelsofinvestment,accumulation,anddispossessionhithertounseenin

theseterritories,thesenon-indigenousarrivalswoundupprofoundlyreshapingtheclass

structureofTransjordan.Totheextent,moreover,thatitwastheextensionofOttomansecurity

whichhadhastenedthearrivalofnon-indigenousmerchantcapitalinthefirstplace,onecanalso

seehowclassandstatewereboundbyaco-constitutiverelationsincetheveryinceptionof

modernTransjordan.114

Therelationbetweenmoneyandpoweronlydeepenedintheyearsaheadas

Transjordan’squicklymetastasizingbourgeoisiesetaboutestablishingcommercialempires

throughouttheterritory’semergingmarkets.AstheexamplesofWafaal-DajaniandSabriTaba’a

makeclear,memberofthisnon-indigenousmerchantclasswereconsistentlyaffordeda

privilegedstatusbytheOttomanBankacrosstheclosingdecadesofthe19thcenturyandearly

decadesofthe20thcentury.115Extendedbothcollateral-lesslettersofcreditandexclusiveimport

permits,suchactorswereabletoexploitsuchprivilegessotoamasssignificantfortunes.116Once

114 WithdemandforagriculturalproductsgreatlyexpandingduetotheMashriq’smoregeneralincorporationinto

theglobalcapitalistsystemandwiththebuildingoftheHijazrailwayfurtherfacilitatingboththeexpansionofthestateandthemovementofgoods,thesemerchantcapitalistssawtheirwealthsteadilygrowoverthecourseofthelate19thandearly20thcenturies.

115 ThesemerchantswonthefavoroftheBank’sDirectorHaydarShukri,whoprovidedthemwithaccesstowide

linesofcreditwithoutrequiringmuchinthewayofcollateral. Formoreonthisperiod,see:AblaAmawi,StateandClassinTransjordan.Doctoraldissertation,Georgetown

University(1993),p.481.116 Certainly,thecapitalstockofthismerchantclasspaledincomparisontothatwhichhadbeenaccumulatedalong

thecitiesofthemoredeeplyintegrated,significantlymoretraffickedMediterraneancoast. See:PhilipRobins,TheConsolidationofHashemitePowerinJordan1921-1946.Doctoraldissertation,Universityof

Exeter(1988),p.324

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thosefortuneswereestablished—fortunesderivedofpoliticalinterventionasmuchas

entrepreneurialspirit—,moreover,thisproto-capitalistclasssubsequentlyproveadeptat

leveragingtheirwealthtoextractassetsandrentsfromtheTransjordanianpeasantry.117

Thisphenomenawasmostobviouslymanifestuponthiseconomicelite’sembraceoftax

farmingandwhatmighttodayberecognizedaspredatorypaydaylending.118Withthevolatility

oftheweatherrenderingtheharvestinmanyareasofTransJordanhighlyunpredictable,cash-

strappedfarmers,forcedtoreckonwiththeimminentarrivaloftheOttomantaxman,were

somethingofaperfectmarkforthesetypesofoperations.119TheAbuJaberfamily,oneofthe

scionsofthecontemporaryJordanianeconomy,standsoutasoneofthemostnotorious

beneficiariesofthisparticularaccumulationthroughdispossessionracket,whichtheyusedto

acquiremassivelandholdingsintheareassurroundingAmmanbytheearly1900s.120Amongst

thedispossessed,thefarmersofBalqa,Karak,andMa’ansufferedmostacutely.121Ofgreat

117 Amawi(1993),p.469-470.118 OftenworkinginconjunctionwithOttomanbureaucrats,thesemerchantsturnedmoneymenwouldsetup

predatoryfinancialarrangementswherebytheyagreedtocoverafarmer’staxobligationsinexchangefortheultimatetransferofcollateral(i.e.property)orusuriousrepaymentrates.See:Masri(2005),p.121,andHamarneh(1985),p.183-184forgreaterdetails.

119 ItisworthnotingthatpeasantpopulationsinnorthernTransjordanprovedmoredeftinmanagingtheOttoman’s

taxadministration.120 Tell(2013),p.43121 Regardingthisrelationshipbetweenaccumulationanddispossession,see:Tell(2013),p.41-45 Inadditiontoaccumulationthroughdispossession,itisworthmentioningthatbycentury’sendandastradeand

commercegrew,smallscale,agriculture-basedindustryalsogainedafootholdintheTransjordanianeconomy.ThoughscarcitiesofcapitalandthedeficienciesinelectricityproductionanddistributionmeantJordanexperiencednothingevenapproximatingindustrializationproper,theestablishmentofflourmills,distilleries,andcigarettefactoriesnonethelessgavesomeindicationofthelargereconomictransformationthenunderway

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importance,onemustalsonotethatitwasinthesesamepre-MandateyearsthatTransjordan’s

non-indigenousbourgeoisiebothacquiredaclassconsciousnessandbegantoinstitutionalize

itselfasaclassforitself.Theseparticulartransformationswerebothreflectedandconsummated

intheestablishmentoftheAmmanChamberofCommerce(ACC)in1910.122

AsIhopethisbriefhistoricalreviewhasbeensufficienttodemonstrate,then,thedecades

precedingtheBritishMandatewereindeedofunambiguousconsequencetothesocial,economic,

andpoliticaltrajectorieslatertakeninTransjordan.Firstly,asthegenealogyofthecountry’s

foreignbourgeoisieattests,theseyearsendowedapolarizedandelite-dominatedclassstructure.

Evincingaswelltheextenttowhichpoliticalprivilegehelpedmidwifethebourgeoisieinthefirst

place,thissamegenealogycanalsohelpunwindthehistoricallogicinformingJordaniancapital’s

contemporaryproclivitytowardsrentandfavorseeking.Finally,havingdemonstratedhow

capitalinstitutionalizeditselfthroughtheACCpriortothefoundationoftheMandate,thishistory

Formoreonearlyindustrialization,see:MichaelMazur,EconomicGrowthandDevelopmentinJordan.Croom

Helm(1979).122 OntheformationoftheACC,see:Masri(2005),p.124-125. AsIwilldiscuss,theinfluencethemerchantswereabletoexertonearlystate-buildingwasadirectfunctionof

thefirstHashemiteEmir’senduringfinancialprecarity.Constantlyshortonthecashneededtosustainhispatrimonialistgriponpower,theEmirwasforeverinneedoffriendswhomighttidehimoverintheleanearlyyearsofhisMeccanexile.Cognizantofthis,themerchantcapitalistsorganizedattheACCwouldprovemorethankeeninextendingthisdesperateEmiraconstellationofloansandgrants.Holdinghisfateintheirdeeppockets,theywouldthenleveragetheEmir’sindebtednesssotoacquiredefactovetopowerovertheproto-legislativeprocess—particularlyintheareaoffiscalpolicy.UltimatelyabletocajoletheEmirintothedirectionstheypreferredasconcernedmattersoftaxationandrevenuegeneration,thesemerchantswoundupdefiningthefoundationsoftheHashemite’sfiscalsociology—foundationsthathaveprovedremarkablyresilient.Indeed,inthepagestocome,Iwillshowhowcapital’smoldingoftheHashemiteproto-state—aswellasthestate’sgrowinginfluenceovertheprospectsofcapital—coalescedsotoconstituteaverypeculiarpoliticaleconomy.InconjunctionwiththesociopoliticaleffectsderivedfromBritish-ledinitiativesinlandreformandinbuildinganationalmilitary,theseco-extensiveandseminalprocessesofclassandstateformationwouldbecomebasictotheinstitutionalizationofmoderncapitalisminJordan,andarethereforeofcriticalimporttotheproblematiqueattheheartofthisdissertation.

76

alsoaffordscluesintohowthisrelativelysmallgroupofactorswouldlatermanagetoshapethe

structuresofthemodernstateinamannerdetrimentaltolong-termdevelopmentaswell.

TheBritishMandate

In1918,thediplomatichorsetradingthathadprecededtheeventualpost-wardissolution

oftheOttomanEmpireultimatelyresultedintheUnitedKingdom,oneoftheprinciplevictorsof

WorldWarI,beingrewardedwithanumberofMandatesacrosstheMiddleEast.Thisfullhistory

isbeyondthescopeofthisdissertation,thoughtithasbeenaptlycoveredinanumberof

foundationaltexts.123AmongsttheterritoriestobeincludedwithintheUK’snewimperial

possessionswere,ofcourse,Transjordan’s.124IfBritishoriginsinTransjordancanbethereforebe

tracedbacktothebargainingandmapmakingofEnglishandFrenchcolonialofficials,thestoryof

theHashemite’sroadtoAmman(bywayofSalt)isslightlymoreconvoluted.

WithalineagetracingbacktothefoundinggenerationofIslam,theHashemitefamilyhad

longrepresentedoneoftheparamountreligio-politicalforcesinallofArabia.AsWorldWarI

commenced,infact,thefamily’spatriarch,Hussein,heldthetitleofSherifofMecca,apositionof

123 ForafullhistoriesontheSykes-PicotnegotiationsthatwouldcarvetheMiddleEastintoFrenchandEnglish

mandatesfollowingthisdismemberment,see: EugeneRogan,TheFalloftheOttomans:TheGreatWarintheMiddleEast M.E.McMillan,FromtheFirstWorldWartotheArabSpring:What’sReallyGoingonintheMiddleEast JamesBarr,ALineintheSand:Britain,FranceandtheStrugglethatShapedtheMiddleEast.124 ItisworthnotingthattheactualbordersoftheMandateofTransjordanwouldnotbesolidifieduntilthelate

1920s.

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significant(ifslightlyoverstated)symbolicandmaterialimportanceacrosswhatmightbe

(problematically)identifiedastheMuslimworld.

AsinfluentialashisauthoritiesinMeccahadalreadymadehim,theSherif(andhissons)

harboredfargreaterambitionsfortheirfamily.Havingobservedthepoliticalwindsoftheearly

20thcentury—andhavinganticipatedthecollapseoftheOttomanEmpire—,theseHashemites

daredtoimaginethatanindependentpan-Arabkingdommightsooncomeintofruition,andthat

suchakingdomwouldinevitablycomeundertheirfamily’sdynasticcontrol.Inanattemptto

speaktheserathergrandiosevisionsintoexistence,thefamilycultivatedtieswithBritish

intelligenceanddiplomaticstaffsotoexplorewhetherawartimepartnershipmightyielda

commensuratepeacetimedividend.SweptupinBritishduplicityanddouble-dealing,the

Hashemiteswereultimatelypersuadedtolaunchtheirmuch-ballyhooedGreatArabRevoltin

1916.

However,atthesametimeastheHashemiteswererevoltingandallowingthemselvesto

dreamofanexpansiveKingdomstretchingacrosstheGulf,Iraq,andtheLevant,theyfound

themselvesrenderedsuddenlyprecariousbackontheirtraditionalhomefront.Byvirtueofthe

Saudi-WahabiyyaaxisthenrampagingitswayacrosstheeastoftheArabianpeninsula,the

longtimestewardsoftheHejazwereacutallyseeingtheirgriponanancestralbirthrightslipat

theverymomentwhentheirpan-Arabistprojectseemedclosesttofulfillment.125Asthe

HashemitesweresoontobebetrayedbytheseparateagreementsthattheBritishhadalready

125 See:Tell(2013),pp.55-60 ThoughtheSherifheldontoMeccauntil1924(andMedinauntil1925),theHashemite’spowerinArabiawas

highlyprecariousfromthelatteryearsofWWIonward.

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signedwiththeZionistleadershipaswell,theSherifandhissonswerethereforeinahighly

dubiouspositiononcethegreatwarfinallycametoitsclose.

Unfortunately,thereisnotspacewithinthistexttoappropriatelycoverthelongand

complexhistorythatsubsequentlyproceededaslocalandforeignactorsjostledforpowerand

controlacrosstheregion.126SpecifictotheHashemitesinTransjordan,however,andforthesake

ofparsimony,wemayreducethishistoryasfollows:thoughAbdullahibnHussein,theeldestson

oftheformerSharifofMecca,hadinitiallybeenofferedtheIraqithronebytheIraqiNational

Congress(athronelatertakenupbyhisbrother,Faisal,thoughonlyafterhewasbanishedfrom

DamascusbytheFrenchArmy),aconstellationofvariables—includingtheimperial

gamesmanshipofthegreatwar’sEuropeanvictors,theparticularcolonialarithmeticofthe

Hashemite’schiefguarantors(theBritish)127,andAbdullah’sunilateralclaimingof

126 Formoreonthishistory(andmythology),see: TimothyParis,Britain,theHashemitesandArabRule:TheSherifianSolution(2004); EfraimKarshandInariKarsh,“Mythinthedesert,ornottheGreatArabRevolt”,MiddleEasternStudies(1997)

RashidKhalidi,TheOriginsofArabNationalism(1991) MCWilson,TheHashemites,theArabRevolt,andArabNationalism(1991) JosephMassad,ColonialIdentity(2001).127 Regardingthatcolonialarithmetic,anumberofpointsareworthmaking.First,Whitehallhad,ofcourse,issued

conflictingwartimepromisestoAbdullah’sfather(thentheSherifofMecca)andtheZionistleadershipthenconsolidatingtheirsettlercolonialprojectinthelandsofPalestine.OncetheBalfourDeclarationconsolidatedthelatter’s(partial)claimonPalestine,theGreaterArabiathathadbeenpledgedtotheHashemiteswasnolongerviable.

Simultaneously,WhitehallwasalsobecomingincreasinglyunnervedbythebrazenaggressivenessoftheSaud-

WahabiyyaaxisinArabia,which,asmentioned,displacedtheSheriffromMeccaandMedinain1924-1925.AstheWahabiyya’sraidingwasbecomingagrowingmenacetothelandsthatwouldbecometheBritishMandateofIraq—andasthismilitantBrotherhood’sambitionsextendedasfarwestasPalestine—,Abdullah’sunilateralmoveonTransjordansuddenlypresentedsomevaluefortheBritish.AHashemite-ledbufferstateinthesebackwaterlands,afterall,mightbeabletokilltwobirdswithasinglestone—honoring(inpart)thepromisestheBritishhadmadetotheSherifasregardedanArabKingdomwhilealsohelpingtosecureBaghdadandJerusalemagainstWahabiyyaencroachment.

SeeTell(2013),pp.60-70formoredetails.

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Transjordan128—sawtoitthatheeventuallywoundupontheeastbankoftheriverJordan.While

thebordersofthisBritishMandate—whichwastoeventuallybecomeAbdullahKingdom—would

notbefirmlysetatthetimeAbdullahwasnamedEmir(1921),andwhiletheraidingWahabiyya

wouldconsistentlytestTransjordan’ssouthernborderacrosstheearlyyearsofthe1920s,this

emergentpolityacquiredsomedegreeoflegalandgeographicsolidityby1923.129Ofnote,the

tribesofTransjordan,manyofwhomhadsupportedtheOttomansduringthewarandforwhom

thesonofaMeccanSherifwasacompleteunknown,werenotevennominallyconsultedonthese

matters.

ThePoliticalInstitutionalizationofaForeignKing

Asonemayhaveanticipatedfromwhatwasintimatedabove,Abdullah’sself-coronation

didnotgodowneasywiththelocalpopulationsthatweretobemadesubjectstosuchanon-

nativeandanonymoussovereign.Manylocaltribes,infact,forcefullycontestedtheEmir’sself-

aggrandizingpresumptivenessbyorganizingaproto-nationalistresistanceandrebellion

throughoutthefirsttwoyearsoftheMandate’sexistence.130

Duetohisevidentlackofcredibilityamongstdomesticactorsandhisdistancefromlocal

socialforces,itwouldbeunsurprising,then,whenAbdullahbuilthisinitialpoliticalcoalition

128 Ibid,pp.60-62. 129 Forthishistory,see:NaseerAruri,Jordan:AStudyinPoliticalDevelopment(1921-1965).Springer(1972),pp..4-5130 TheAdwantribewasquitefamouslytheleaderoftheserebellions.Formoreonthistopic,seeBettyAnderson,

NationalistVoicesinJordan:TheStreetandtheState.UniversityofTexasPress(2005),pp.43-52.

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throughpartnershipswithethnicnon-Transjordaniansalone.Evidenceofthis,hisearly

governmentswerestaffedalmostentirelybytheexiledmembersofHizbal-Istiqlal,themajority

ofwhomhailedfromLebanonandSyria.Theseemigres,manyofwhomwerecentralfiguresin

thearticulationandmobilizationofearlyArabnationalism,hadpreviouslyservedAbdullah’s

youngerbrotherFaisalduringhisbriefreigninDamascus.MakingtheirwayintoTransjordan

onlyaftertheFrenchmilitarycampaignhadbroughtFaisal’sreigntoanunillustriousend,they

werementhatultimatelysawtheirJordaniansojournasasteppingstonetosomethingbigger.131

Byvirtueofthefacttheirlong-terminterestslyingbackinDamascusandinthepan-Arabentity

theyhopedthatcitywouldbecapitalto,theIstiqlalistsgovernedTransjordanaccordingto

cynicalandinstrumentalistrationalities.Seekingnothingbeyondtherevenuesneededtoraisean

armysotoretakeDamascusandwhollylackinginbothknowledgeandconcernforpeopleof

Transjordan,Abdullah’spartnershipwiththeIstiqlalists,lastingthroughthemid-1920s,wouldbe

mostrememberedforthebrutaltaxregimeitimposeduponTransjordan’sagriculturalists.132

Duetothevagariesofimperialpolitics133andthesocialdislocationborneofthe

Istiqlalist’spunitivetaxregime,Abdullah’sfavoredSyrian-Lebaneseallieseventuallylostfavor

withtheEmir(andhisBritishminders).TheirsubsequentexpulsionfromJordanin1924

affordedtheKingtheopportunitytoJordanizehispoliticalelite.Hedidnot,however,avail

131 FormoreontheIstiqlalistsinJordan,see:Tell(2013),pp.62-64;Anderson(2005),pp.36-37.132 AsTell(2013)hasdetailed,thisresultedintheTransjordanianpeasantrybeingsqueezedfornineandhalfyears

worthoftaxationoverthecourseofthreeyears(p.63).133 Specifically,theFrenchrequestedthattheBritishcrackdownontheIstiqlalists,whocontinuedtoorganize

agitationagainsttheformer’sMandateinSyria.

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himselfofsuchanopportunity.Rather,hereplacedhisIstiqlalistswithsecondedMandateofficials

reassignedtoTransjordanfrompreviouspostingsinPalestine.Thissubstitutionofforeignlike

forlikemeantthatindigenouspoliticalrepresentativesremainedlockedoutoftheemergentstate

apparatus—wheretheywouldstayforthemajorityoftheMandateperiod.134Givingsome

indicationofthisnativediscrimination,oftheforty-eightgovernmentministersappointedor

electedduringtheMandateperiod,onlyeightwerenativeTransjordanians.135

Ofcourse,asimportantasAbdullah’sforeignconsiglieresweretothepoliticsandpolicyof

theearlyMandateperiod,theirinfluenceultimatelypaledincomparisontothatoftheBritish

authorities.Itwas,afterall,theBritishRoyalAirForceanditsarmoredcarsthatputdownthe

tribalandproto-nationalistuprisingsinal-Kura(1921)andAmman(1923).136Ifalwaysleaving

himabitshort(anddependentondomesticmerchantcapital,asIwilldiscuss),itwastheBritish

subsidyandannualgrant-in-aidthatunderwrotewhatindigenouslegitimationAbdullahwasable

topurchasethroughrathercrass,transactionalarrangementswithselecttribalchiefs—

principallythoseoftheBaniSakhr.137Lastly,itwasalsotheBritishResidency(andtheHigh

134 FormoreonearlyMandateeragovernance,see:PhilipRobins(1998)andAnderson(2005),p.53.135 Tell(2013),p.75 PriortoJohnGlubb’sestablishmentoftheDesertPatrol—anoutfitthatwouldrecruitfromandmakeofficersof

theHuwaytat,BankSakhr,andSirhantribes(Tell,76)—thesameregimeoflocaldiscriminationandanti-Transjordaniannesswouldalsoreignwithinthesecurityforces.

136 Anderson(2005),p.44.137 PerRobins(1988),p.298,theBritishprovidedtheEmirwithapersonalstipendof36,000£forthemajorityof

the1920s.Thisfiguregrewto100,000£bytheendofthedecade.SuchafigurewasmeanttocovertheEmir’spersonalexpensesandthecostsofmaintaininghisgovernment.Independentofthis,forthemajorityofthe1920s,theBritishstatealsoprovidedtheMandate’smilitaryforceswithannualgrants-in-aidrangingfrom66,000-180,000£.Thesegrantsfinancedsalaries,expenses,buildings,etc.

FormoreontheEmir’sselectivepatronageofthetribes,see:Tell(2013),pp.74-77.

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Commissionerinparticular)thatdroppedallpretensesregardingTransjordan’sapprencticeship

inself-rulesotogovernunilaterallyfrom1924onward.138

Proceedingonanadhocbasisinitially,Britain’sunilateralseizureoffiscal,administrative,

legislative,andmartialpowerswaseventuallyformalizedin1928uponthesigningofthe

AgreementBetweenHisMajestyandtheEmirofTrans-Jordan.139Sotoaddalegalist-moralist

sheenandadegreeofindigenouslegitimacytothiscoupofthecolonialoffice,theBritishalso

establishedaquasiconstitutioncalledtheOrganicLawthatsameyear.Nominallyspeaking,the

OrganicLawcontainedsomeprogressivemeasures.Forexample,itprovidedforthe

establishmentofanationalLegislativeCounciltobefilled,inpart,byelectedrepresentatives.

Despitetheadjectiveinitstitle,howeverthisCouncilwasonlyconsultativeinnature.Whatis

more,theEmir,whosehereditaryrightsastheheadofstatewerealsojuridicallyestablishedin

theOrganicLaw,wasalsotoretainthepowertodissolvetheCouncilwheneverhedeemed

necessary—ashewouldontheoccasionforthefirstLegislativeCouncilin1929—andwide

discretionaryauthoritieswhenitcametotheappointmentanddisqualificationof

representatives.140GiventhatthepopularrepresentativeschosentotheCouncilwerefiltered

throughanelectoralsystemcombiningindirectballoting(inheritedfromOttomanLaw)anda

138 Inkeepingwiththetimes,thisquietcoupwaslegitimatedthroughtheassertionthatneithertheEmirnorthe

Transjordanianpeoplehad“yetprovedtheircompetenceinlearninghowtoadminister[thecountry].” Massad(2001),p.31139 Aruri(1972),p.76140 Ibidp.4 Onthepositivesideoftheledger,itshouldbeacknowledgedthatAbdullahdidusetheLegislativeCouncilsto

integratethesonsofdociletribalnotablesintothemiddleandlowerranksoftheadministrativestate(Tell,2013,pp.73-75).

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muddledsystemofminority-orientedquotas—thetoothlessnessofthedemocraticinstitutions

bequeathedbytheBritishwerematchedbytheirnon-representativenessaswell.141The

institutionalizationofsuchapoliticalsystemprovedunsurprisinglyalienatingforthevast

majorityoftheMandate’ssubject-citizens.142

TheStateintheEconomy:LaissezFairetoGrowingWelfarism

Upuntilthelate1920s,theMandateAuthority’sinvestments/interventionsinthe

Transjordanianeconomywerebothnegligibleandsociallynon-impactful.Arelativebackwater

withintheBritishconstellationofArabMandates,TransjordanalsoreceivedlittlefromWhitehall

whenitcametoadministrativeresourcesandpersonnel.TotheextentthatTransjordan’s

Mandateofficerswereengagingwithquestionsofeconomicdevelopmentatallintheyears

precedingthegreatdepression,moreover,itwasthroughthe“prevailingorthodoxyofeconomic

liberalism.”143Withdevelopmentpolicytherebystructuredbythetenetsofbalancedbudgets,

141 The3%participationrateinthefirstelectionconductedunderthissystem(1929)demonstratestheextentto

whichtheTransjordanianpeoplerightlyperceivedthehollownessofthisinstitution. Formoreonthisperiodofpolitical/constitutionalhistory,see:TariqTell,“Bedouin,FallahandState”inEugene

RoganandTariqTell(eds.)Village,SteppeandState:SocialOriginsofModernJordan.BritishAcademicPress(1994),p.179;Also,seeAruri(1972),p.78.

142 Thealienationproducedbythesehollowedinstitutionsmanifestedinthegrowing(andconsistentlypro-

democracy)agitationbeingorganizedbyanemergentJordanianNationalMovement(JNM)throughoutthe1920sand1930s(Tell,2013,p.80).AtthesametimeastheKingwassigningawayJordan’ssovereigntytoBritaininexchangeforhisfamily’sdynasticclaims,theJNM’sGeneralNationalCongressofJuly1928wasissuingtheJordanianNationalCharter.Init,theyassertedthatJordanwas“anindependentsovereignArabcountry”,thatitwastobegovernedconstitutionallyanddemocratically,andthatanylegislation“thatisnotbasedontheprincipleofjusticeandthegeneralwelfareandtherealneedsofthepeople”wouldbeconsideredvoid(Massad,2001,p.30).

143 Knowles(2001),p.86

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freetrade,andmarket-ledinvestment,Transjordan’speripheraleconomymadelittleheadway

beyondwhatwasgeneratedthroughthecommercialarbitrageofitsmerchantcapitalists.

Threehistoricallycontingentevents,theeffectsofwhichwerecompounding—theglobal

economicdepressionofthelate1920sandearly1930s,thepersistentdrought-likeclimactic

conditionsthatwerecontemporaneoustothedepression,andtheGreatArabRevoltattempted

byPalestiniannationalistsbetween1936-1939—precipitatedsignificantchangesintheBritish

approachtoTransjordan’seconomy.TheAuthority’ssubsequentadoptionofanactivistmodality

ofinterventionismwouldbebifurcatedaccordingtowhatIhaveconceptualizedasmass-oriented

policiesandelite-orientedpolicies.IntegratingdiversesegmentsoftheJordanianbodypolitic

intowhatTellhascalledthemoraleconomyoftheHashemiteregime,themassorientedpolicies

oftheMandateauthoritieswerelargelyinkeepingwiththeKeynesianconsensusthateventually

rosetoprominenceinthewestfollowingtheonsetofthedepression.144Apublicworksprogram

wasestablishedin1931,forinstance,whichfunctionedsotobuildcriticalinfrastructureatthe

sametimeasitprovidedsustenanceandwagesforvulnerablepopulations.Havingbeenmade

acutelyprecariousduetothedroughtsofthe1920sandthebrashraidingcampaignslaunchedby

theArabianWahabiyya,thisinitiativeprovedalifesaverforthesouthernBedouininparticular.145

Beyondprovidingacriticalsourceofwages,theroadsandtrainlinesthatwerelaiddownduring

theseyearsofcoursefunctionedsotofacilitatethemovementofgoods(andthemovementofthe

144 ForacompletereviewofthisKeynesianturn,seeTell(2013),pp.77-80,83-108.145 Ibid,pp.85-93.

85

Mandate’ssecurityforces146)aswell.Suchindirectbutequallypositiveexternalitiesweretobeof

criticalimportforlong-termcapitalaccumulation.147

Intermsofnumbersemployedandlong-termsocioeconomicimpact,however,theeffects

ofthepublicworksprogramstillpaledincomparisontothosethatwouldbeachieveduponthe

MandateAuthority’sexpansionofitsmilitaryfootprint.Financedbyasharpincreaseinthe

Britishsubsidy148andledbyasingularlyinfamousfigureinJordan’smodernhistory—PashaJohn

Glubb—,thestaffingoftheMobileForce,ArabLegion,TransjordanianFrontierForce,andDesert

PatrolForceprovidedthousandsofsteadyjobsfortribesmenotherwisestrugglingtofindaplace

inthemodernizingeconomy.Coupledwiththesejobcreationefforts,moreover,wasanemerging

systemofmilitarywelfarismthatincludedhealth(aswasbestrepresentedbyGlubb’sDesert

MobileMedicalUnit)andeducationalinitiatives.149

146 ThisinfrastructureprovedessentialduringthePalestinianUprisingof1936-1939.Duringtheearlyyearsofthis

conflict,PalestinianforceshadevadedBritishmilitaryforcesthroughseekingandreceivingsanctuaryfromtribesinTransjordan.Oncetheseroadswerebuilt(andoncemanyofthesoutherntribeswerebroughtintotheemployoftheMandateAuthoritiesinTransjordan),thesesanctuarieswereclosed,andtherepressionoftheuprisingwasmadefareasier.

147 Mostimmediatelyhelpful—especiallyforTransjordan’simpoverishedagriculturalists—werethetaxexemptions

andsubsidiesonseedsthatwereprovidedacrossthe1930s.Whileaidingalotofdesperatepeople,thetribesmenoftheHuwaytatandBaniSakrcouldbesaidtohavebeentheprinciplebeneficiariesoftheseparticularinterventions.SeeTell(2013),pp.96-101.

148 Bytheearly1940s,Britishaidhadbeendividedintothreecategories:(1)budgetarysupportfortheMandate

government(2)apersonalstipendof100,000£totheEmirand(3)grants-in-aidforthevariousmilitaryforcesorganizedbyGlubb.

149 ThoughtheMandateadministrationwaslargelycontenttoleaveeducationinthehandsofreligious

organizationsandactors,theestablishmentofasmallHighSchoolinal-Saltinthe1930swouldendupeducatingmanyofthefiguresthatwouldgoontoleadtheJordaniannationalmovementandtostaffthehighestlevelsofthepost-independencebureaucracy.Amongsttheschool’smostfamousgraduateswereSulaymanal-Nabulsi,thePrimeMinisterwhowouldbeoustedbytheyoungKingHusseinin1957;Wasfial-Tall,oneofthecentralactorsintheattempttobuildadevelopmentaliststateinJordan;andHamedalFarhan,oneofthemostinfluentialeconomicplannersofthe1950s.See:Anderson(2005),pp.54,63,68-71.

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CentralGovernmentBudgets,1924-1944(Britishpounds)

Years Total Revenue Annual Average Total Expenditures Annual Average 1924/25-1937/38 4864236 347445.4 4859644 347117.4 1938/39-1943/44 8375516 1395919.3 8615645 1439940.8 Total 13239752 661987.6 13475289 673764.5

DataprovidedbyKnowles(2001),p.87

Inmanyways,Glubb’seffortsinthesespacesbotharticulatedthesocialcharacterofwhat

wouldbecomethemodernstateandlaidablueprintforhowtoembedtheeconomyinamanner

conducivetostabilityandclasscompromise.150Slightlylessglamorousifnolessimpactfulin

theseregardswerethepassageoftheLandSettlementLaw(1933)andtheenormousland

registrationeffortssubsequentlyundertakenbyErnestDowson’sDepartmentofLandsand

Surveys.InthenorthoftheMandate’sterritories151—regionsthathadbeenmoreextensively

administeredbytheOttomanbureaucracyandwheretheprecedentofpropertyrightshad

alreadybeenintroducedundertheOttomanLandLawof1858—,thelandregistrationprocess

wasunambiguouslysociallypositive.There,thedeedingandtitlingofpropertiesresultedinthe

consolidationofsmallfamilyfarms,ensuringadegreeofsocialequityatthesametimeasit

150 Politicallyspeaking,thismilitarizedwelfarefunctionedsotoremakepreviouslyrebellioussouthernBedouin

tribesintoessentialalliesoftheHashemitemonarchy.Complementedbyanumberofothereffortsintargetedco-optation—specifically,theappointmentofobedienttribalSheikhsandthesonsoftribalsheikhstogovernorships,judgeships,cabinetpositionsinpost-1930Mandategovernments,aswouldbebestexemplifiedduringthetenureofTawfiqAbual-Huda—,militarizedstatebuildingundergirdedmuchofthe(fragile)architectureuponwhichthepost-colonialstatewouldbebuilt.

SeeJoabEilonandYoavAlon,TheMakingofJordan:Tribes,Colonialism,andtheModernState.IBTauris(2007),pp.118-124.

151 ThesocialeffectsoflandregistrationinotherareasoftheMandatewereconsiderablydifferent,however,asIwill

detail.

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embeddedandlegitimatedtheMandatebureaucracyamongstthepeopleoftheregion.

Subsequentinterventionstosecuresmallfarmersagainsttheusuryanddispossessionthatwere

endemictothedroughteconomy—beitthroughdebtforgiveness,taxexemptionsorajudicial

systemthattendedtobefavorabletotheinterestofsmalllandholders—onlyfurtherensconced

thenorthintheMandate’smoraleconomy.152

Iflandregistrationhadcontributedtotheestablishmentoffamilyfarmsandhealthyclass

relationsinTransjordan’snorth,however,oneneedrecognizethatitsimplementation

engendereddislocationanddispossessioninthecenterandsouthofthecountryaswell.Ashas

beenamplydocumentedbyAlon,landtitlinginthoseareasoftenallowedinfluentialchiefs—

chiefswhowerealsoalliestothePalaceandtheMandateauthorities—tostokefearsofthatthe

titlingofpropertywouldimplyburdensometaxobligationsuponthetitlebearer.Cynically

manipulatingtheverysameandpartitioningandregistrationprocessesthathadprovedso

successfulinAjloun,suchchiefsfrequentlyappropriatedtheentiretyofwhatwereonce

commonlyheldtriballandsfortheirpersonaluse.Inthismanner,Mithqalal-FayizoftheBani

Sakramassedhugelandholdingsaswellasconsiderableinfluencewithinthestillmetastasizing

state.153Lateraffordedsubsidiesand(free)machineryinanefforttoeasetheirtransitioninto

landcultivation,theconsolidationofthechiefs’megalandholdingsinthesedecadesprefigures

theinefficient,water-depleting,elite-dominatedcommercialagriculturethathasprovedso

destructivetoJordanoverthepasttwentyyears.

152 See:Fischbach(2000)forthemostcomprehensiveanalysisofBritish-eralandreformefforts.153 Formoredetailsonal-Fayiz,see:YoavAlon,TheShaykhofShaykhs:Mithqalal-FayizandTribalLeadershipin

ModernJordan.StanfordUniversityPress(2016).

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Ofcourse,theseagriculturalpoliciesdidnotrepresenttheonlypraxisofMandate-era

elite-orientedeconomicinterventionism.Ifproceedingaccordingtolong-termsocialand

developmentalimpact,oneoughtactuallybeginwithmattersoftaxpolicy.Herein,oneneed

recognizethattheEmirwasconstantlyshortoncashthroughoutthe1920sand1930s,regardless

ofthestarkincreasethattheBritishinstitutedtotheroyalsubsidyfromthe1930sonward.By

Social Control and the Mandate SSA Social control during the Mandate period was less concerned about the shop floor and more about generalized order. The British High Commissioner’s decreeing of the Crime Prevention Law of 1927 went a long way in these regards by allowing Mandate Authorities to use warrantless arrests and indefinite detention for anyone deemed a security threat. The cause of social peace was similarly served by the Law of Collective Punishment and the Exile and Deportation Laws of 1928, which allowed the authorities to harass and expel not only dissidents within the nationalist opposition but also the tribes, communities, families, and parties to which they were member (Massad, 31). The violence of a British-imposed social peace was most acutely felt than amongst the Bedouin tribes of Transjordan’s southern territories. Institutionalized through 1924’s Law of Tribal Courts (amended in 1936) and 1929’s Bedouin Control Law (also amended in 1936), the Mandate Authority’s juridical interventions legally exceptionalized the Bedouin by placing those categorized as such outside the remit of prevailing citizenship rights. More specifically, the aforementioned laws established a kind of tiered legal system internal to the Mandate, a tiering that removed the Bedouin from the jurisdiction of civil law so to subject them to the intersecting remit of traditional customs and military law (Tell, 85). While each piece of legislation was introduced as a temporary measure nominally designed to ease the transition of the Bedouin into modernity, they stayed on the books until 1976. The formalization of the bedouin exception would prove highly conducive for social control. On the one hand, by inventing and institutionalizing tribal law, John Bagot Glubb—the British military officer then organizing and reinstitutionalization Jordanian security—also created the need for official tribal judges. The manufacturing of this need, in turn, created an opportunity for the distribution of patronage, which Glubb would seize by rewarding the docile amongst the tribal leaders with appointed judgeships. If that was the carrot side of this wider social control operation, the Bedouin Control Law provided the stick. Bringing southern Jordan under Glubb’s personal, autocratic jurisdiction while subjecting its peoples to the austere rationalities of military law, discipline could always be enforced should good behavior not be induced through the granting of favors. The specter of direct repression—as was suffered by the Adwan between 1921 and 1923—, made clear how far this disciplining could go. Upon the establishment of a tentative agreement between Ibn Saud and the Mandate government in 1925 as regarded the southern border—an agreement functioning so to fix the Bedouin in space through subjecting their movements to the logic and regulations of borders—, the lives of these communities would also be more tightly monitored by agents of the state (Massad 52).

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virtueofthisfact,hehadoneoftwooptionsinfinancinghisexpenditures.Ontheonehand,he

couldattempttoraiserevenuethroughtaxation.Sucheffortshad,ofcourse,failedquite

ignominiouslyundertheIstiqlalists.154Ontheother,theEmircouldturntolessformalmeansby

callinguponthemerchantsthathadaccumulatedsizablefortunesacrossthepreviousthreeor

fourdecadesinhopesofsecuringloans,grants,orsomecombinationofthetwosotomeetthe

Palace’sfiscalneeds.

BritishSubsidytoMandateTransjordan,1921-1944

*GraphprovidedbyKnowles(2001),p.57

154 History,ofcourse,hasmadeclearthatajustandrationallyadministeredtaxsystemisfundamentaltoany

country’spolitical,social,andeconomicfutures.Theimpositionofsomekindofincometaxsystem—regardlessofitsinitialprogressiveness—,afterall,investssocialequityandeconomicefficiencyintotheinstitutionalontologyofthestate-societyrelationship.Notonlydoesthisprovidethematerialconditionsneededforaneventualtransitiontowardsdemocraticgovernment;whatismore,thechallengesincumbenttotheadministrationofanincometaxsystemalsorequiresthatahighlycapableandrationalizedstatebeinstitutionalized.Astheestablishmentofaskilledbureaucracylaterallowsforhighlevelsofindustrialanddevelopmentplanning,theimpositionofanincometaxhasanumberofaddedknock-oneffectsaswell.

90

Fortheirpart,saidmerchantsrecognizedthattheinstitutionalizationofanincometaxsystem

promisedtocutintotheirprofitrates.Unwillingtocountenancesuchaninterventionintowhat

theydeemedtobetheirprivateaffairs,theyorganizedobstructionisteffortsthroughtheAmman

ChamberofCommerceanditsChairman,Sabrial-Taba’a,andultimatelymanagedtopersuadethe

Emirtoavoidsuchacostlyendeavorbypromisinghimthattheywouldpassthehatamongst

theirownsotomakesurehewasalwayslookedafter.155Investingwhimsicality,informality,and

inequityintothefiscalsociologyofanemergentstatewhoserevenuestrategyhadalreadybeen

compromisedbyitsexternaldependence,thehalflifeofthesepersonalistlendingarrangements

wouldprovelongindeed.

ThefinancialbeholdennessoftheEmirnotonlyaffordedTransjordan’smerchanteliteof

TransjordandefactovetopowerwithintheMandate-eralegislativeprocess.Italsoallowedthem

toextractfavors,privileges,andbusinessopportunitiesduringtheyearsofWorldWarII—a

constellationofbenefitsthatwouldinturnallowforunprecedentedlevelsof(highly

concentrated)capitalaccumulation.Thebusinessopportunitiesofofthewaryearswerelargely

introduceduponBritain’sestablishmentofaMiddleEastSupplyCenterin1941.Designedto

handlepotentialconflict-relateddisruptionstothemovementofgoodsandsupplies,theMESC

155 Acrossthe1920sand1930s,saidmerchantswoundupextendingthisEmiraseriesofdiscretionaryloans

whenevertheywereneededsotomakeupshortfallsinthePalacebudget.Thoughmanyoftheseloanswentunrepaid,thiswasasmalllosstotakeinexchangeforkillingoffthepossibilityofanincometax.AstheEmir’sprivatecreditors/benefactorsalsoreceivedappointmentstohigh-levelbureaucraticappointmentsandcabinetpositionsaswellasrightstopurchasepublicly-heldlandsintheJordanValleyatpriceswellbelowmarketvalueinexchangefortheirhelp,thepainofhaircutwasmadeevenlesssignificant(Fischbach,2000,pp.73-75).

FormoreontheunrepaidloanstheACCprovidedtheEmir,see:AnneMarielZimmerman,USAssistance,

Development,andHierarchyintheMiddleEast.PalgraveMacmillan(2017),pp.107-108.

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hadbeeninauguratedfortheexplicitpurposeof“overcomingthelimitationandshortagein

suppliesaswellastoensureeconomicstability”forthewiderMiddleEastthroughthe

institutionalizationofasystemofimportdistribution.156BytreatingallofBritain’scolonial

possessionsasasingle,integratedeconomicunit—adecisionthatwasitselftakenwithaneye

towardsreducingshippingcosts—,theestablishmentofsuchacentralizedbodymeantthatthe

movementofgoodsintheMiddleEastwouldhenceforthberegulatedbyandchanneledthrough

asingleadministrativenode.Inaddition,whilethelargersystemwasoverseenbyBritishand,

later,Americanofficials,localMandategovernmentsandtheirrespectivecustomsdepartments

weretobeassignedconsiderablediscretionarypowerinmanagingMESCoperationsonthe

ground.InTransjordan’scase,suchadministrativedecentralizationempoweredDirectorof

CustomsP.Livingstone,hisassistantR.T.Ledger,andtheaforementionedDirectoroftheOttoman

BankHaydarShukritounilaterallydecidemattersrelatedtotheissuanceofmonopolyimport

licenses,quotas,andshippingspaceregulation.157

Inbothexpeditingregionalcommerceandsuppressingcompetitionthroughthelicensing

system,theMESCpromisedtomakefortunesforthoseabletopositionthemselvesfavorably

withintheimporteconomy.Assuchpositioningwasinevitablypolitical—andastheallocationof

favorswasundeniablydeterminedbyanindividual’sproximitytotherelevantBritishcustoms

officialsaswellasbytheirstandingwithinthenetworksofprivilegeuponwhichthePalacehad

156 FormoreonthefoundationoftheMESC,see:Masri(2005),p.126.157 SeeAmawi(1993),pp.422-430,461-465.

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consolidateditspowerandpatrimonialismoverthepreviousten-oddyears158—,itshouldnot

strikethereaderasshockingthattheprimarybeneficiariesoftheMESC’swar-timemarket

controlswoundupbeingthesamemerchantelitethathadpreviouslyfinancedthePalace’s

budgetdeficits.

ThemagnitudeofaccumulationfacilitatedthroughtheworkingsoftheMESC—andthe

impactthishadonJordanianclassformation—arehardtooverstate.Specifictoaccumulation,the

aggregategainsachievedthroughthecombinationofamerchant’smonopolycontrolofgrain

markets,hoardingpractices,andsmugglingofcontrabandwereofascalequalitativelylarger

thananythingpreviouslywitnessedinTransjordan.159Asthisrelatestoprocessesofclass

formation,byexcludingallbuttheeliteofelitefromparticipatingintheselicensingrackets,the

MESCfurthercleavedanalreadyrupturedandsegmentedcapitalistclass.Concentrating

unprecedentedlevelsofwealthinthoseAblaAmawiwouldidentifyasthequotacoteriewhile

subjectingtherestofTransjordan’ssmallbusinessmentoincreasinglevelsofprecarityand

deprivation,thegapthatopenedupbetweenahandfulofpoliticallyconnected,commerce-centric

elitesandeveryoneelseduringtheprecariouswartimeyearswouldproveunbridgeableoverthe

158 PerAmawi(directlyreferencingMESCreports),theMESCgavepreferentialtreatmentto“establishedtraders”

andthose“whowerereliableandcouldfinanceoperations”inawardingimportlicenses.Byconsequence,pre-existingwealth/influence/prestigewouldoperateasthedefactocriteriathroughwhichmonopolyimportrightsweredetermined.Seepp.484-485.

159 Masri(2005),p.128 Thoughmuchoftheirprofitswereachievedthroughexploitingimportmarketsforluxurygoods,itisworth

notingthatsomeinstancesofaccumulationunambiguouslyrequiredthedispossessionanddeprivationofthelessfortunate.Ofthoseinstances,thehoardingofgrainsisbutthemostobviousexample.Forhoweachofthesemerchantsenrichedthemselves,see:Amawi(1993),pp.483-488.

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decadestocome.160Asmembersofthequotacoteriesubsequentlyintermarried161and

institutionalizedtheircollectiveinfluencethroughcontroloftheAmmanChamberofCommerce,

thedisjunctureofaninsulatedelitefromtherestofthebusinessclasswasonlydeepened

throughsocialandorganizationalpartitionsaswell.162

Bybothbestowingparticulartendenciesandinterestsuponthebusinesseliteand

impartingconflictual,antagonisticpropertiesintodomesticcapitalasawhole,theMESC’seffects

onJordan’seconomicfutureprovedprofoundlysignificant.Whenitcametoeither

industrializationortheprospectsofmarketcompetitionmoregenerally,forinstance,the

consolidationofsuchahegemonicclassfractionwas,inandofitself,ahighlyadverseoutcome.

Afterall,asthemembersofAmawi’squotacoterieallretainedanendogenousmaterialinterestin

traderelatedarbitrageandadependenceonimportconsumption,theywouldnecessarilyimpede

theprotectionismandindustrialinvestmentthatwouldbeneededforlong-termeconomic

development.Whatisworse,byrewardingstatus,proximity,andpoliticalinfluencewith

monopolizedimportrightsamongstotherprivileges,theMESCalsomanagedtodeepenthisclass

fraction’stendencytowardsrent-seekingratherthanprofit-seekingactivities.Completingthe

circularlogicinherenttothisformofstate-capitalrelations,themassiveratesofcapital

accumulationrealizedthroughrent-seekingatthistimealsobolsteredthepoliticalinfluenceof

thissmallhandfulofactorsasMandateTransjordaninchedcloserandclosertoindependent

160 Amawi(1993),p.502.161 Specifically,theSafadiandal-Bitar,NuriandTabaa,Ma’albakiandTabaa,BudeirandMalhas,HaffarandBudeir,

andMuasherandal-Bakhitwereallboundbymarriages.162 Foradetailedhistoryofthisconsolidationofpower,see:Amawi(1993),pp.509-529.

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Jordan.InlockingboththePalaceanditsbourgeoiseliteintoasub-optimalcodependency

consummatedthroughrentsandfavoritism,then,themodalityofstate-capitalrelations

institutionalizedduringWorldWarIIwouldnotonlyprefiguremuchofthecronyism,investment

conservatism,andcommercialbiasthathaveunderminedJordaniancapitalismacrossits

existence.ByconsolidatingadirectlineofcommunicationbetweenPalaceandelitecapital,italso

insuredthattheparticularinterestsofthisclassfractionwouldcometobepoliticallyarticulated

andprivilegedinthepost-colonialperiod,therebyunderminingthedevelopmentofarationalist

stateaswell.163

TheQuotaCoterie

Itisworthpausingheretotakestockoftheparticularfamiliesthatcomprisedthequotacoterie(andthewidereconomiceliteoftheearly1940s)assodoingwillallowthereadertobetterappreciatetheremarkablecontinuitiesbridgingpastandpresentwhenitcomestoJordan’seconomicelite.164 Regardingthequotacoterieitself,Amawiidentifiesthirty-oneindividualsofmixedethnicbackgrounds,anumberofwhomwereeitherboundbymarriageofhailingfromthesamenuclearfamily.AswasmeticulouslydetailedinAmawi’sdissertation,thisslimmestofclassfractionswaslargelycomprisedofthefollowingmen(ethnicbackgroundislistedwithintheparentheses):HamdiMango(Palestinian),IbrahimMango(Palestinian),Sabrial-Taba’a(Syrian),Hashimal-Taba’a(Syrian),theHatahitfamily(Syrian),Umaral-Ma’albaki(Syrian),ShawkatAsfur(Palestinian),MuhammedKhayrAbuIrsheid(Syrian),RushdiQatramiz(Syria),Abdelal-HamidAjami(Syrian),ZakiIdlibi(syrian),Abdal-RahmanMadi(Transjordanian),KhalilMalas(Syrian),Wajihal-Aqil(Palestinian),RashidDarwaza(Palestinian),Salimal-Bakhit(Transjordanian),Najib 163 ThepoweroftheseeconomicelitesintroducedtensionsattheveryheartofJordan’spoliticalandsocialsystems.

Whilethesetensionscould(andwould)bepartiallyassuagedthroughtheeconomicelite’sfinancingofpublicemployment,therehasalwaysbeenabasicdisjuncturebetweentheinterestsofthePalace-bourgeoisaxisandtheinterestsofpeasant,Bedouin,andproto-proletarianpopulations.Whenitcametopolicyquestions,therewouldalsobeafundamentalantagonismbetweenamerchantelitebiasedtowardsanimport-dependentaneconomyandanemergentcoreofnationalist,developmentalistbureaucratsseekingtobuilddomesticindustry.

164 Assectiontwoofthisdissertationwilldealwithextensively,thecontemporaryJordanianbourgeoisieremains

dominatedinnosmallpartbythedescendantsofthisquotacoterie,heirsandlegacychildrenwhohaveevolvedwiththeirco-dependentsponsorsinthestatesotoadapt,reconstitute,andappropriatetheopportunitiesandrentsprovidedbychanginginstitutionalcontextsandevolvinginternationaleconomicsystems.

95

(Continued)al-Bakhit(Transjordanian),Subhial-Halabi(Syrian),YasinTalhuni(Transjordanian),Wafaal-Dajani(Palestinian),Isma’ilal-Bilbaisi(Palestinian),Ramzial-Haffar,MuhammedAliB’deir(Syrian),Khalilal-Shuqayr(Syrian),AhmadMalhas(Palestinian),TawfiqQattan(Palestinian),Jamilal-Safadi(Syrian),HusniBahlawan(Syrian),YasinDiyab(Syrian)andAbdal-HamidDiyab(Syrian).165 Thoughnotamongstthisquotacoterie,anumberofotherprominenteconomicfamiliesalsoestablishedtheirfootholdamongstthebourgeoiseliteduringthelateMandateperiod.IhavealreadydiscussedtheAbuJaber’s(Transjordanian)massivelandholdingsandexploitativecreditbusinesses,bothofwhichwereaugmentedacrossthe1930sand1940s.Alsonotableamongstthetheirwar-timeopportunistswerebothMunirShuqayr—aformercivilservantwhosuccessfullymanagedtostakeoutaclaiminclothimportation—andJawdatSha’sha’a.FortunateenoughtoinvolvehimselfwithbothBilbaisi’sShellOildistributionmonopolyandSpirHaddad’sluxuryimportbusinesses166,Sha’sha’awouldbeoneofthefewthatmanagedtojumpthegapsotojointhemembershipofthequotacoterie,drivinghisfamilytotheverytopoftheJordanianclass structureintheprocess.167ItwasintheseyearsthatthewealthoftheMu’asher(Transjordanian)andAbual-Raghib(Syrian)familieswereaccumulatedaswell.168 Finally,IneedalsoacknowledgethatuponJordan’sacquisitionoftheWestBankin1948-1949,theMESC-derivedcapitalistfractionwouldalsowelcomeanumberoffinancialandmerchantcapitalistsbasedoutofJerusalem,Nablus,andHebronintotheranksoftheirelite.169MostrelevantamongstthenewadditionsweretheShoman,Touqan,Kawar,al-Sakhtiyaan,Nuql,Jardeneh,andMasrifamilies.Merchants,bankers,andproto-industrialiststhemselves,thepatriarchsofeachfamilyswiftlyascendedtheranksoftheTransjordanianeconomicelite.Particulartothissubgroup,itisworthnotingthatwithJordan’spoliticalintegrationofthetwoBanks,AbdelMajidShoman—whohadfoundedArabBankinJerusalemin1935—instantaneouslybecamethemostinfluentialrepresentativeoffinancialcapitalinindependentJordan.170

165 AslocalagentoftheShellOilCompanyandthroughhisexclusivecontroloverthedistributionfuel,Ismai’ilal-

Bilbaisiacquiredhisfortune.ThroughduopolisticcontroloftheimportationofPersiantobacco,monopolisticcontroloverPersianrugs,Englishtextiles,andagrainextractionscheme,IbrahimMangobuilthis(Ibid,486).HewasjoinedinPersiantobaccoimportationbyMithqalAsfur,andbyAjamiandMa’albakiinhistextileandgrain-basedaccumulation(Ibid,486-488).

Forthefulllist,seep.480.166 HaddadcontrolledthemarketforvelvetacrossMandateTransjordanandMandatePalestine.167 Amawi(1993),pp.499-505.168 See:Masri(2005),Appendix10.169 Forthishistory,seeIbid,p..131.170 OnShoman,seeIbid,p.295.

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Conclusion

Inthischapter,Ihaveattemptedtoexcavatethesocial,political,andeconomicfoundations

ofbothJordaniancapitalismandtheHashemitestate.Havingrevealedhow,where,andwhythese

foundationsintersect,itismyhopethatthisexcavationhasallowedthereadertobetter

appreciatethepathdependenciesanddeep-runninghistoricallogicsunderpinningnotonly

today’spoliticaleconomybuttheunderdevelopmentitengenders.Havingrevealedhow

fundamentallyco-imbricatedprocessesofclassandstateformationhavebeeninJordan,itisalso

myhopethatthereaderwillbebetterabletodiscernthebehavioralpropertieshistoryhas

conferreduponcontemporarypoliticalandeconomicelites,andhowthistoocontributesto

Jordan’scapitalismofcrisis.

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CHAPTERFOUR

IndependentJordan’sfirstsocialstructureofaccumulation:1946-1973

Asindicatedinitstitle,thischapterwillreviewindependentJordan’sfirstsocialstructure

ofaccumulation.Afterfirstappraisingthepoliticaldomain,thisreviewwillproceedtoanalysesof

the(i)particularformofeconomicinterventionismadoptedbythestateduringthisperiod;(ii)

theparticularformofstate-capitalrelationsconsolidatedduringthisperiod;(iii)theformof

marketcompetitionconsolidatedduringthisperiod;(iv)thesocialcontrolregimeconsolidated

duringthisperiod;(v)theexternalarticulationoftheeconomyduringthisperiod;and(vi)the

ideologicalinstitutionalizationofpower/capitalevincedduringthisperiod.Thechapterwill

close,finally,bydetailinghowthiswidersocialstructureofaccumulationcameundonebeginning

inthelate1960s.

…………………………………………………………………………………………………………………………………………………

ThePoliticalInstitutionalizationofthepost-independencesocialstructureofaccumulation

TheBritishMandateinTransjordancametoaclosein1946.Notwithstandingthe

pageantrythatmarkedtheterminationofthiscolonialarrangement,theindependenceand

sovereigntyofthefreshlydeclaredHashemiteKingdomofJordanwastobehighlylimitedforthe

firstdecadeofthecountry’sexistence.TheselimitswereafunctionofthenewTreatyofAlliance

thattheEmirhadsignedwiththeBritishamonthpriortotheMandate’stermination.Amongst

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otherthings,thistreatystipulatedthatBritishofficers(principally,PashaJohnGlubb)retained

controlandleadershipoftheArabLegion.Havingabsorbedandintegratedthevariousentities

previouslyconstitutingtheJordanianarmedforcesoverthepreviousfive-oddyears,this

stipulationmeantthattheentiretyofthestate’ssecurityapparatuswouldtherebyremainunder

thedirectionofnon-nationals.171Supplementingthisabdicationofthesovereign’smonopolyon

violence,thenowKingAbdullahalsoagreedtocontinuestationingBritishtroopsonJordanian

territoryforthedurationoftheTreaty.Withthefiscalcapacityoftheyoungstatestillwholly

dependentonBritishbudgetsupportaswell,continuitiesinthebasicontologicalcharacterofthe

statewouldhavemadeitdifficulttoparseexactlywheretheMandateendedandwhere

independencebegan.

Notwithstandingtheenduringsamenessoftheearlypost-colonialstate,theseyearsdid,

ofcourse,introduceanumberofratherprofoundchangestolifeintheHashemiteKingdomas

well.WindfalloftheKing’sbackroomdoubledealingwithGoldaMeirintheyearsimmediately

precedingthePalestiniannakba172,itwasatthistime,afterall,thatboththephysicalgeography

andthepopulationofJordaneffectivelydoubledthroughthecountry’sacquisitionoftheWest

BankandJerusalem.

Thetransformationsimpliedandprecipitatedviatheswiftandunilateralannexationof

theseterritorieswereimmediate,irreversible,andwide-ranging.Nowstewardtooneofhistory’s

mostcontestedovercities—andnowpositionedattheverycenterofwhatwouldbecomeoneof

171 Aruri(1972),p.87172 ThisdoubledealingwasformalizedduringnegotiationsatAl-Shunahin1949-1950,andiscoveredinIlan

Pappe’sBritainandtheArab-IsraeliConflict1948-1951(Springer,1988).

99

theworld’slongestrunningconflicts—,Abdullah’sbackwaterKingdomovernightacquiredthe

kindofinternationalrelevancethatitsHashemitemonarchhadsolongaspiredfor.Uponthe

passageofanaddendumtoJordan’sCitizenshipLawin1949,thecitizenryoverwhomthis

monarchwastorulealsoacquiredadiversity(andmagnitude)wellbeyondwhathehadgrown

toknowduringtheMandateperiod.173Andthentherewasthemostdirecttransformationofall,

theoneborneofthefactthattheKing’sannexationalsobroughtabouthispersonaldemise.

AssassinatedinAl-AqsaMosquebyanethnicPalestinianunwillingtocountenancetheKing’s

complicityintheerasureofthePalestiniannation,Abdullah’sdeathsetinmotionasuccession

transitionattheverymomentthatregionaldebatesoverpost-colonialrepublicanism,socialism,

anddevelopmentwerereachingacrescendo,atransitionthatwouldprovehighlyconsequential

tothesocialstructureofaccumulationthateventuallyconsolidatedinindependentJordan.

ThistransitiondideventuallyconcludewiththeascensionofKingHussein.Priortothat,

however,therewasabriefthoughinfluentialinterregnumduringwhichAbdullah’seldestson,

Talal,heldexecutivepower.EventuallydeposedthoughTalalwas174,theshortnessofhistenure

173 OnthetemporalandgeographicacrobaticsthatwouldinformJordaniancitizenshipfromthestart,seeMassad

(2001),pp.22-92. InternaltothedemographicchangesintroducedviatheabsorptionoftheWestBankandthehundredsof

thousandsofPalestinianrefugeesthatcametosettleontheeastbankintheaftermathof1947-1948,moreover,wereaseriesofvariablespoisedtoreorderthepolitical,economic,andsocialfoundationsoftheKingdomaswell.Thoughtheeffectsofthesevariableshavebeenoccasionallyoverstatedbyscholarsofthisperiod,theintegrationofamoreindustrializedandmorecosmopolitanWestBankunambiguouslyprecipitatedsignificantchangesinthekindsofpoliticalideasthatwerebeingarticulated,intheformsofpoliticalorganizationbeingmobilized,inthenatureofcapitalaccumulation,andintheextenttowhichclasscametoinsinuateitselfintoallofthis.

174 TheofficialreasonforTalal’sremovalwasmentalunfitness.Mostscholarsacceptthegeneralveracityofthis

claim.TotheextentthatthisclaimwasaggressivelypushedbyAmericanandBritishofficerswhowereconcernedwiththeJordanianleft’sinfluenceoverTalal,however,therearesomereasonsforbeingskepticalofthesehistoricalaccounts.SeeMassad(2001),pp.166-171forsomedetailsonthevariousintriguesatplay.

100

didnotpreventhimfromoverseeingthedraftingofJordan’ssecondpost-independence

constitution(thefirstwascodifiedin1947).

PromulgatedinJanuaryof1952,Talal’sconstitutionwasasprogressiveasaconstitution

enshriningadynasticparliamentarymonarchycanbe.175Ofitspositiveattributes,beyond

articulatingawiderangeofsocial,political,andcivilrights,the1952constitutionalsodelineated

adivisionofpowersandestablishedabicamerallegislaturecomprisedofanelectedLowerHouse

alongsideaSenatedirectlyappointedbytheKing.Totheextentthatitsimultaneouslymanaged

thehermeneuticalacrobaticsneededtolegallyreimaginethenation(anditscitizensubjects)in

thecontextofmassiveterritorialaggrandizement,itwasadocumentnotbereftofmerits.Of

course,onewouldberemisstoignoretheshortcomingsthatwerealsofundamentaltothe1952

constitution.BeyondmakingtheKingCommanderinChief,italsorenderedtheMonarch

somethingofaSchmittiansovereignthroughassigninghisperson(ratherthantheelectedLower

House)thepowertoappointanddismissboththePrimeMinisterandthegovernmentwritlarge.

Inalsoprovidingthemonarchwithpowersofthepursue,withthepowertocallforelections,and

withdiscretionarykindsoflegislativeauthority—theconstitutionstipulatedthattheKingcould

decreelegislationbyroyalordinanceintheabsenceofparliamentandthathecouldevoke

emergencypowersmoregenerallyshouldlegallyunderspecifiedcrisisconditionsmakeit

necessary—,theconstitution’sdivisionofpowerswerenominalinmorethanoneway.176When

onealsoconsidershowtheconstitutionquietlyretainedsweepingDefenseRegulationsinitially

175 RussellLucas,InstitutionsandthePoliticsofSurvivalinJordan:DomesticResponsestoExternalChallenges,1988-

2001.SUNYPress(2005),p.17.176 Formoreonthepoliticalimplicationsofthisconstitution,seeLucas(2005),pp.22-23.

101

legislatedbycolonialofficersin1939—regulationswrittenwiththegoalofaidingtheMandate

Authority’seffortsinquellingthePalestinianuprisingsofthelate1930s—,therather

pronouncedlimitationsofthedocumentcomeintoevenstarkerrelief.177

TheselimitationsandthedangerstheycreatedforJordan’sfledglingdemocracywere

quicklymaderealuponTalal’sdisplacementin1953.Usheredintopowerattheripeageof

eighteen,Talal’sheir,KingHusseinwouldinitiallyflirtwithmanyofthesameprogressive

nationalistandpan-Arabistforcesashadhispredecessorbeforeultimatelyyielding—withapush

fromtheCentralIntelligenceAgency—totheseductionsofanautocraticpowergrab.178Takingan

allegedcoupattemptin1957asthecasusbellineededtobringJordan’sexperimentwithpopular

governmenttoanunfortunate(andsemi-permanent)close,hisconsolidationofpowerwouldbe

swift.179DeclaringMartialLawonApril24thofthatyear,Husseindismissedthegovernmentof

Sulaymanal-Nabulsiandmovedshortlythereaftertounwindandrepressalltheinstitutional

foundationsofJordan’sdemocracy.Hewasaidedintheseeffortsbyacoterieofrehabilitated

Mandateeraconservatives.180

177 UrielDann,KingHusseinandtheChallengeofArabRadicalism:Jordan1955-1967.OxfordUniversityPress(1989),

p.5.178 Thehistoryoftheseflirtationsandthecontingentdevelopmentsthatsawhimeventuallyabandonprogressivism

isbeyondthescopeofthisdissertation,thoughithasbeensubjectedtoprocesstracingandthickdescriptionbyanumberofoutstandingscholarsshoulditbeofinteresttothereader

See:Massad(2001),p.165-189. AsherSusser’sOnBothBanksoftheJordan:aPoliticalBiographyofWasfial-Tall(Routledge,1994)containsa

numberofinterestingdetailsaswell.179 ItisalsoworthnotingthatHusseinhadabrogatedhiscountry’streatywithBritainanddismissedJohnGlubb

fromhisperchatoptheArabLegionin1956inanattemptatbrandishinghispan-Arabistcredentials.180 Forhistoriesontheseyearsofpoliticalstruggle,seeMassad(2001),pp.165-194;Dann(1989),pp.21-52

102

Amongstthejuridicalmaneuversmostessentialbothtothisparticularcrackdownandthe

subsequentasphyxiationofJordaniandemocracy,oneneedbeginwiththesuspensionof

parliament,thegerrymanderingoflaterelections181,andtheillegalizationofpoliticalparties.182

Herein,therescindmentofthefreedomofassociationwasperhapsthemostimpactfulvis-a-vis

thelong-termhealthofthepolity.Bycancelingpoliticalparties,afterall,Husseineffectively

emptiedthepublicsphereoftheoneinstitutioncapableofstabilizingJordan’sfragilepolitics

duringthosecriticalmomentswhenthecountrywasfeelingitswaythroughthedisorienting

initialexperienceofindependence.Leavingthedemoswithoutanylegal-formalmechanismfor

mobilizingandarticulatingcollectivegrievanceandaspiration;withoutanymechanismfor

conductingthemasseducationcampaignssodesperatelyneededbyapost-colonialpolity;

withoutanyinstitutionabletorepresentsocietyinthestateasmuchasrepresentingthestatein

society;andwithoutanymeansofintegratingbourgeoisie,workingclass,andlumpenproletariat

alikeintoparticipatorygovernanceandapluralistnationalproject,thisdissolutionofthe

partisansundercutJordan’sdemocracyattheverymomentitwasgatheringitsfeet.183

181 Dann(1989),p.120182 Ofcourse,oneshouldnotromanticizetheelectoralsystemthathadbroughtNabulsi’sgovernmenttopowerin

thefirstplace.Structurallybourgeoisified,theelectoralsystemthatvotedintheChamberofDeputiesin1956hadonlyextendedthefranchisetotaxpayers(thereforepropertyowners)andneitherrefugee,thebankrupt,normilitaryservicemanwereentitledtothevote.Notwithstandingtheseobviousissues,theElectionsLawof1960,writtenintheaftermathofthecoup,wouldmakethisexclusivistsystemappearasanexemplarofrepresentativenessandpopularagency.

SeeDann(1989),p.6;andIlanPappe,“JordanbetweenHashemiteandPalestinianIdentity,inJordanintheMiddleEast,1948-1998:TheMakingofaPivotalState(eds.JosephNevoandIlanPappe),1994,p.70-71formoredetails.

183 Whatismore,inexemptingtheMuslimBrotherhood’sIslamicCenterCharitySocietyfromthisotherwise

comprehensivecrackdownonassociation,healsoassuredthattheywouldbetheonlyentitywiththeorganizationalinfrastructurenecessarytothriveinelectoralpoliticswhenthetimecameforpoliticalliberalization.

103

ComplementedasthismaneuverwasbyrepressivePressLawsandthereimpositionof

censorshipacrossthe1950sand1960s,onecanseehowthereproductionofthemonarch’s

hegemonycametobeinseparablefromthe(coerced)politicalimmaturityofhisdemos—and

howthepoweroftheformerrequiredthenon-realizationofthecitizen.184

EquallyfundamentaltothepoliticalinstitutionalizationofJordaniancapitalisminthis

periodwasawidersecuritizationofpolitics.Withmartiallawineffectthroughoutthe

tumultuoussixteenyearsthatfollowed1957,thissecuritizationcollapsedthetraditionaldivision

separatingtheinternalfromtheexternalsphereofpolitics.Institutionally,thiscollapsewasfirst

operationalizedthroughtheArmy’sabsorptionofpolicinganddomesticsecurityresponsibilities

intheaftermathof1957.185Fromthisfoundation,amorecomprehensivesecuritizationof

Jordan’spoliticswouldfollow—aswellasamoretotaldissolutionofJordandemocratic

institutions—upontheoutbreakoftwonewpoliticalcrisesin1967and1970-1971,respectively.

ThefirstofthesecrisescostJordantheWestBankandresultedfromtheKing’sjoiningof

theArabwareffortagainstIsrael.Thelossofterritoryinturnprovidedtherationalefor

continuingthesuspensionofelectionsasitwasdeemedinappropriateandunfeasiblethatthe

citizenrygotothepollswhilehalfthecountrywasunderIsraelimilitaryoccupation.Thoughthis

suspensionwasintroducedasareluctantandtemporarymeasure,itwoundupextendingfor

twenty-twoyears.186Ifthepoliticalsystemwastherebyincreasinglydisarticulatedfromthe

184 Aruri(1972),p.150185 Intermsofpersonnel,regimestalwartHabisal-MajaliwouldbeassignedcontroloftheArmedForceswhile

Muhammadal-Kilanirosetoprominenceandbuiltabaseofpowerasahighlyinfluentialheadofdomesticintelligence(Massad,2001,p.202).

186 Ibid,p.97

104

demosasthe1960scametoaclose,thesecondoftheaforementionedcrises—thecivilwar

pittingtheprimarilyPalestinianFedayeenagainsttheMonarchyin1970-1971—cementedthe

breakbyintroducingentirelynewlevelsofrepressiveness,violence,anddiscriminationintothe

polity.187Havingalreadysuspendedelectionsandcrackeddownonpoliticalexpressionin1967,

Husseinnowproceededtosuspendtheoperationsofthe(gerrymandered)parliamentitself.188

From1974through1984,thePalaceactuallygovernedinthetotalabsenceofalegislative

counterweight.189NotwithstandingtheextenttowhichtheLowerHousehadalreadybeen

renderedarubberstampinstitution,thesuspensionofparliamentwasstillsignificantinthatit

allowedtheexecutiveandanemergentsetofPalaceappointedpolicyinstitutionstorulethrough

187 Jordan’sethnicPalestinianssufferedanumberofacutediscriminatoryeffectsuponthedefeatandevictionofthe

Fedayeen.ThiswassodespitethefactthatthePalestinianfedayeencountedmanyethnicTransjordanianamongsttheirnumber—anddespitethefactthattheregime’ssupporterscountedmanyethnicPalestiniansamongsttheirnumber.WhilefacileaccountsofBlackSeptembertendtopresentthisasaconflictpittingPalestiniannationalistsagainsttheirJordaniancounterparts,therealitywasfarmorecomplex.

Formoreaccuratedepictionsofevents,seeMassad,p.236-248;YezidSayigh,ArmedStruggleandtheSearchfor

State:ThePalestinianNationalMovement1949-1993;HelenaCobban,ThePalestinianLiberationOrganisation:People,Power,andPolitics;p.;.IrisFruchter-Ronen,“BlackSeptember:the1970-1971eventsandtheirimpactontheformationofJordaniannationalidentity”,CivilWars.

Regardingthesediscriminatoryeffects,inadditiontoinauguratingadePalestinizationofthestate—apolicy

severelydiminishingthebureaucracy’scapabilities—,post-1971,Hussein’slieutenantswouldalsouprootPalestiniannationalistsfromthetradeassociations,professionalassociations,laborunions,andculturalgroupswheretheyhadpreviouslymobilized.In1986,hewouldalsoelectorallyredistrictthosePalestinianrefugeecampsthatwerelocatedeastoftheriverJordantotheWestBank,anactofremarkablecartographicimaginationthatwouldtreathundredsofthousandsofvotersinthevicinityofAmmanasiftheywereresidentsofRamallah.Atoncesimplifyingtheregime’sgerrymanderingeffortsandeffectivelydenationalizing/deterritorializingEastBank-basedcitizen-subjects,itwasameasureforeshadowingthekindsoflegalotheringofcampPalestiniansthatwouldbesoeagerlyadoptedbyHussein’sson.

Formoreonthesehistoricalprocesses,see:AdnanAbuOdeh,Jordanians,Palestinians&theHashmiteKingdomin

theMiddleEastPeaceProcess(1999);Massad(2001),p.259.188 See:Susser(1994),p.157-159.189 LaurieBrand,Jordan’sInter-ArabRelations:ThePoliticalEconomyofAllianceMaking(1994),p.71.

105

royaldecreeandtheunilateralissuanceofprovisionallaw.Thesubsequententrenchingofsuch

governingpraxes—apermanentizationoftheExecutive’stemporarylegislativepowers—would

becomedeeplyconsequentialforJordaniancapitalisminthepost-1973context.

Ifitwasnotalreadythecase,then,thepoliticalcrisesof1967and1970-1971wouldsee

toitthatregimesurvivalcametoconstitutethesingularlogicandmodusoperandiorienting

Hashemitegovernance.Withthemaintenanceofroyalpowernownotonlysupersedingbutalso

subsumingthedevelopmentalistdutiesofthenation-state,theprioritiesofthePalacewould

becomeincreasinglydissociatedfromthoseofstateandsociety.TheeffectsofthePalace’s

divergencefromthestatewerequicklyevincedinthedomainofeconomicpolicymaking.Not

withstandingHussein’seffacementofdemocracy,tohiscredit,itisworthnotingthatpriorto

1973,theKinghadnotovertlyimpededtheworkoftheambitious,nationalistbureaucratsthat

hadcomeintoinfluenceacrossthepost-independencedecades.Theseetatistes,fromMustafa

Wahbahal-TalandhissonWasfial-TaltoHazzaMajali,HazimNuseibeh,Hamadal-Farhan,Munif

al-Razzaz,KamalalSha’ir,andIbrahimHabashnah,allsoughttobuildthekindofmeritocratic-

rationaliststatetheyknewtobenecessaryforJordan’slong-termdevelopment.Manyofthese

individualshadbeeneducatedfirstinJordan’sfirstsecondaryschoolinSaltandlaterunderthe

guidanceofConstantinZuraykwhileattendingtheAmericanUniversityofBeirut.190Staffingthe

MinistryofEconomy,thesemendirectednotablesuccessesinlandreform,electrification,

190 Zuraykwasoneofthepre-eminentintellectualsdrivingthepan-Arabisttrendandchampioningthevictimsofthe

Palestiniannakbaduringthepost-colonialperiod.

106

irrigation,andinestablishingindustrially-focusedcreditinstitutions,especiallyduringtheyears

followingal-Tal’sappointmentasPrimeMinisterin1962.191

Alas,justlikeJordan’sdemocracy,thestate-buildingprojectenvisionedbythese

bureaucratswouldcomeundoneunderthepressuresandchangesintroducedunderthecrucible

ofthelate1960sandearly1970s.AsthemanmostdirectlyresponsibleforthePalace’swaron

theFedayeenin1970-1971,al-TalwounduptargetedandkilledbyaFatehdissidentgroup(Black

September)ashemadehiswaytoanArabLeaguemeetinginCairo(1971).Withhisdeath,the

rationalist-developmentalistmovementinJordanwasdealtablowfromwhichitneverrecovered.

Boundforirrelevanceasitalreadywas,thismovement’sfatewasonlyfurthersealedoncethe

Palace’scofferscametobefilledwithsecondaryoilrentspost-1973’sOPECcrisis.Inthe

immediatesense,theserentsdiminishedtheKing’sneedforarationalistbureaucracycapableof

collectingtaxesorplanningdevelopmentprojects.Inconjunctionwithal-Tal’sdemise,thisledto

thedisplacementofthenationalistbureaucratsandtheriseofacrewofcorrupt,reactionary,and

largelyincompetentregimeloyalistsattheheartoftheadministrativestate.Thisnewpolicy

elite—principallycomprisedofIbrahimHashem,Samiral-Rifa’i,Akefal-Fayez,NuriShafiq,Kamil

AbuJabir,MudarBadran,SuleimanTouqan,SharifbinNasir(theKing’suncle),andBahjatal-

191 Formoreonthisgenerationofpolicymakers,see:Tell(2013),pp.127-129 CyrusSchayegh,“1958Reconsidered:StateFormationandtheColdWarintheEarlyPostColonialArabMiddle

East”,InternationalJournalofMiddleEastStudies(45),2013;p.429-430. PaulKingston“RationalizingPatrimonialism:Wasfial-TallandEconomicReforminJordan,1962-1967”,inTariq

Tell(ed.)TheResilienceoftheHashemiteRule:PoliticsandStateinJordan. Kingston,Paul."Breakingthepatternsofmandate:economicnationalismandstateformationinJordan,1951–

57."Village,steppe,andstate:thesocialoriginsofmodernJordan.London:BritishAcademic(1994):187-216. Susser,Asher.OnbothbanksoftheJordan:apoliticalbiographyofWasfial-Tall.Routledge,1994..

107

Talhuni—largelydominatedgovernmentministriesandtheRoyalCourtacrossthenexttwenty-

oddyears.192

TheStateintheEconomy:ParallelInstitutionsandMilitarizedRooseveltianism

Tounderstandthestate’sroleintheeconomyduringthepost-independenceperiod,one

needbeginwiththeforeignfinanced(andforeignmanaged)parallelinstitutionsthatbuoyedit

throughout.ThoughnotoftheJordanianstateitself,theseinstitutionsoughtbeincludedinthis

sectionbyvirtueofthefactthattheyfulfilledmanyofthatstate’ssocial,developmental,andfiscal

responsibilities.FunctioningsotostabilizeHussein’sruleasmuchasthesocialformationaround

him,theseparallelinstitutions—inclusiveoftheUnitedNation’sReliefandWorksAgencyfor

PalestineRefugeesintheNearEast(UNRWA)aswellasthevariousaidandsupportinitiatives

overseenbyboththeforeignofficesofbothBritishandAmericangovernments—constitutedone

ofthecriticalfirewallswithinthepost-warsocialstructureofaccumulation.

192 AsIwillshowinthediscussionofthenextJordanianSSA,orientedbytherationalitiesofregimesurvivalalone,

KingHusseinwouldnotonlyunderminehismostcapablebureaucratsoutoffeartheymightbuildanindependentpowerbasewithinthestate;hewouldalsochannelpolicymakingpowersintoanumberofautonomous,politicallyinsulatedinstitutionsappointedby(anddirectlyaccountableto)thePalace.SealingthedivorceofPalacefromstate,theseinstitutionsandtheaforementionedpolicyelitewouldmakeanumberofdisastrousdecisionsthatarebasictothe(under)developmentofthecontemporaryeconomy.

Formoreonthiselite,see:TimothyPiro,ThePoliticalEconomyofMarketReform,pp.79-90.

108

Proceedingsequentially,UNRWAwasfoundedin1949.Asitsnamesuggests,thiswasan

entitywhoseinstitutionalraisond’etrewastoprovideforthematerialneedsandhuman

developmentofthe700,000Palestinianrefugeesethnicallycleanseduponthefoundationofthe

Israelistatein1947-1948andsubsequentlydispersedacrossGaza(thenunderthecontrolof

Egypt),theWestBank(underthecontrolofJordan),EastBankJordan,Syria,andLebanon.193

193 ItisworthnotingthatUNRWAwaswidelycriticizedintheArabpublicsphereduringitsearlyyearsof

operations.Thetypicalchargewasthattheinstitutionanditsbackersamongstwesterngovernmentswereattemptingtonormalizetherefugeecrisis(andtheIsraelistate)througheconomicdevelopmentprojectsdesignedtoembedthePalestiniandiasporawithintheirhostcountries.

Foreign Aid: State Building/State Degrading While helping stave off a humanitarian disaster in the wake of the Palestinian nakba, it is important to note that each of these interventions also functioned so to undermine the long-term development of a rationalist/developmentalist bureaucracy. This undermining effect was partially a function of the parallel, largely autonomous, foreign-staffed institutions that were established by UNRWA, the British, and Point Four during the early post-independence period. Adopting, out of necessity, many of the basic roles incumbent upon a sovereign state—from irrigation, water systems, infrastructure, and development policymaking to the entirety of the refugee portfolio—, the many successes these institutions realized in Jordan always implied a tacit though commensurate decline in local capacity building. What is more, given that many of these institutions also poached the Jordanian state’s most high skilled labor, their consolidation did more than preclude the Jordanian state from doing (or learning to do) many of the jobs required of a sovereign government. It also led to a quiet asset stripping of the Jordanian bureaucracy. To the extent that these autonomous institutions’ management of critical public policy areas allowed the Palace to devote its energies towards patronage-related activities as well, they also indirectly contributed to the non-efficient patrimonialism that would come to bedevil Jordanian governance throughout the next sixty years. In many ways, then, the cost of stabilizing the Jordanian polity, economy, and social body, was the undermining of the sovereign state, the deepening of that state’s external dependence, and the embedding of corruption. Though these effects were mitigated during those years when al-Tal et al retained influence at the Palace, they have been prevalent across Jordan’s post-colonial period (up and through the present day).

109

InJordan,thismandatewasoperationalizedthroughtheswiftconstructionofwhatbecame

knownastheUNRWAbluestate,asprawlinginfrastructuredesignedtogovernandcareforthe

country’snumerouscamp-basedrefugeepopulations.Togivesomeperspectiveonthescopeof

UNRWA’sremit,thoughrepresentingonlyafractionofthetotalPalestinianrefugeepopulationin

Jordan,camp-based,UNRWA-registeredPalestiniansstillconstitutedupwardsof35-40%ofthe

nationalpopulationatthetime.

ThepurviewofUNRWA’swelfaristresponsibilitiesextendedfrommattersofshelterand

educationtonutritionandhealth.Inacontroversialsynthesisofwelfare,internationalpolitics,

anddevelopment,thebluestatealsopushedaworksprograminitsearlyyearsmeanttoembed

theformerpeasantryofPalestineintotheeconomyofJordan—therebyeasing(ornormalizing)

thepermanentizationoftheirexile.Regardless,economicallyspeaking,thetotalityofUNRWA’s

effortsclearlyfunctionedtopropupaggregatedemandandtocontainthedisruptionsandsocial

antagonismsthatmighthaveotherwisebeenintroduced.194Notwithstandingthebluestate’s

otherdevelopmentaldemerits195,then,itmostcertainlybolsteredpost-independencecapital

accumulation.

OnUNRWA’sroleinthepost-colonialhistoryoftheLevant,see:RiccardoBocco."UNRWAandthePalestinian

refugees:ahistorywithinhistory."RefugeeSurveyQuarterly28.2-3(2009):229-252. MichaelKagan."TheUNSurrogateStateandtheFoundationofRefugeePolicyintheMiddleEast."UCDavisJ.Int'l

L.&Pol'y18(2011):307.194 ForasummaryofUNRWA’seconomicandsocialinterventions,see:AnneMarielPetersandPeteMoore,“Beyond

BoomandBust:Externalrents,DurableAuthoritarianism,andInstitutionalAdaptationintheHashemiteKingdomofJordan”,StudiesinComparativeInternationalDevelopment(44:3),2009.pp.269-274.

195 Thesedemeritsarediscussedinthetextboxonthepreviouspage.TothepointsmadethereIwouldonlyadd

thatcompletelynecessaryandeffectiveasUNRWA’scaregivingwaswhenitcametodealingwitharatherprofoundhumanitariancrisisforwhichnoneofthepost-colonialArabstates(Jordanincluded)waspreparedto

110

Thesamemultisidedeffectscouldbeattributedtothematerialsupports,expertise,and

personnelthattheBritishandtheAmericangovernmentsprovidedtheJordanianstateinthese

years.TheinfluenceoftheBritishwasmostapparentbetween1946and1956,andnowhere

moresothaninthedomainsofsecurityanddefense,eachofwhichremainedthepersonal

preserveofthenowsecondedBritishmilitaryofficerJohnGlubb.196BeyondGlubb,British

representativesoftheMiddleEastOfficealsocontinueddictatingdevelopmentpolicymaking

acrossthemid-1950sthroughtheirstewardship(andfinancing)oftheJordanianDevelopment

Board.Handlingtheallocationof(British-issued)developmentloansandmilitaryaidand

determiningtheprioritiesoftheKingdom’spubicinvestments,theseofficersorientedthe

trajectoryandstructureofJordanianeconomicdevelopmentduringthefirstdecadeofthe

country’sindependenceasmuchasanyoneelse.197OncetheBritishfinallystartedbeatingtheir

moregeneralizedretreatfromtheregion—awithdrawalfurtherhastenedbythedisasterof

1956’sSuezCrisis—,theAmericansquicklysteppedintothevoidbytakingoverthedirectorship

oftheJordanianDevelopmentBoard,increasingdirectbudgetsupport,andinitiating

programmaticoperationsthroughtheUnitedStatesOperatingMissionanditsTechnical

CooperationAgency(colloquiallyreferredtoasPointFour).Specifictobudgetsupport,US

externalassistancetoJordanbetween1956and1967constitutedroughly20%ofannualGross

NationalIncome.198Equalinpercentagetotherevenuesthenbeingcollectedbythestateand

handleontheirown,itneverthelessholdsthatthesheermagnitudeoftheiroperationscouldnothelpbutconstituteachallengetoHashemitesovereigntyovertime.

196 PetersandMoore(2009)coverthisperiodofJordanianhistorywell.See:pp.266-267.197 Formoreontheirinfluence,seeKnowles(2001),pp.59-62.198 AscitedinZimmerman(2017),p.152.

111

financingnearlyallofJordan’scapitalspending,thissupportunderwrotethesolvencyofthe

post-colonialstatetonosmallextent,andwithit,theprospectsofcapitalaccumulation.199

Movingbeyondtheserathercrudeanddirect(ifalsoessential)interventions,PointFour’s

collaborationswiththeFordFoundationalsosawtoitthatthetermsofJordan’slong-term

economicplanning—asdelineatedinaseriesoffiveandsevenyeardevelopmentplans—were

moresubtlydictatedbyAmericanhandsaswell.GroundingJordan’spolicyapproachinthe

teleologiesofmodernizationtheory,theplanningassistancethatwasprovidedbytheseforeign

institutions(aswellasbytheWorldBank)anchoredJordan’sdevelopmentstrategiestothe

tenetsofstaticcomparativeadvantageandtheagriculturalinvestmentsthosetenetsrequired.200

Thoughhelpingsecuresomedegreeofcapitalaccumulation,byleavinglittleinvestmentfor

industrialization,AmericanplanningalsohelpednudgeJordantowardsaparticularmodalityof

exportorientation—onethatwouldtendtowardsvolatilityanddecliningtermsoftradeover

time.Nordidthenegative(ifunintended)consequencesofAmericaninterventioninJordanend

attheplanningprocess.Byofferingsalarieswellinexcessofwhatwasonofferinthe

bureaucracy—andbyoperatinginisolationfromthatbureaucracyaswell—,PointFour(like

contemporaryUSAidandINGOprojects)alsocontributedtothestuntingoftheJordanianstate.201

199 OnPointFour’simpact,Schayegh(2013)andKingston(2001).200 AlongwiththeIBRD,PointFourandtheFordFoundationwouldlargelydelineatethecontentsofthe1962-1967

5YearPlanforEconomicDevelopmentandthe1963-19707YearPlanforEconomicDevelopment. FormoreontheinfluencethatforeignexpertshadonJordanianpolicymaking,see:Masri(2005),p.133201 AsdetailedbyKingston(1994,p.208),PointFouremployedover1500individualsatsalarieswellbeyondwhat

thePalace-deprivedstatecouldafford.Insodoing,itssomewhatwell-intendedoperationsreducedthetalentavailabletothestate,andtherebyreducedthechancesofJordandevelopingthemeritocraticbureaucracyitsodeeplyneeded.

112

Inaddition,byallowingthePalacetomanipulateaspectsofitsdevelopmentprojectssotofunnel

rentsintothepocketsoftheirnetworksofprivilege,Americanparallelinstitutionsalsohelped

entrenchtheelite-orientedpatrimonialismthatwouldcompromiseHashemitedevelopment

effortsacrossthenextseventyyears.202Forallthesereasons,auditingtheultimatelegacyofthis

eraofAmericaninterventionismishighlycomplicated,astheeffectsbornofbudgetaidand

infrastructuredevelopmentcametobepartiallyoffsetbythosederivedfromPointFour’s

contributionstobothHashemitecorruptionandtotheenduringimmaturityoftheJordanian

state.203

AsfortheeconomicinterventionsundertakenbytheHashemiteregimeitselfinthis

period,oneshouldbeginwithmattersoffiscalsociology.Asthetablesonthenextpageevince,

indirecttaxesandfeesdominatedtherevenuesideofthestateledgerduringtheperiodunder

question.Unwillingorunabletoinstitutionalizeprogressiveincomeand/orcorporatetax

measures,thisrevenuestrategyensuredthatthefiscalsociologyofindependentJordanwas

groundedinthesameclass-biased,upwardlyorientedfoundationsaswasthefiscalsociologyof

MandateJordan.

202 Zimmerman(2017,pp.110,149)andPetersandMoore(2009,p.271)havebothdevelopedthispoint.While

certainlyhelpingagreatmanysmallfarmers,thePointFour-ledEastGhorCanalProject,forexample,alsoprovidedamassivepublicsubsidyforthosemegafarmsandpropertiesthathadbeenconjuredandawardedtopoliticalallies,whetherbyKingHusseinorhispredecessor.In1955,Husseindistributed2000acresofJordanValleyLandtoloyaltribesmenservingintheOfficerCorps.Similarly,asubstantial,$166millionPointFourfinancedfoodaidproject—thetermsofwhichwerelaidoutinPublicLaw480—intendedforthebenefitofJordan’ssmallfarmersalsowoundupfinancingtheestatesandluxuryimportsoftheKing’sfriends.

203 Forinstance,theplanning,construction,andmanagementofhydraulicandirrigationinfrastructureaswellas

transportationnetworkswereundertakenbyinstitutionsautonomousanddisconnectedfromthestate.Indeed,USmoneyandpersonnelthatundertookthemassiveEastGhorCanalproject,themostambitiouseffortofthe1950sandaprojectthatwouldeventuallydeliveredwaterto750,000peopleintheJordanValley(PetersandMoore,269).

113

SourcesofDomesticRevenues,1953-1966

Unit:Percentage

Direct Taxes Indirect Taxes Fees Other Receipts Total 1953/54 13.49 50.01 11.08 25.42 100 1954/55 11.92 50.48 10.03 27.57 100 1955/56 11.75 47.91 12.4 27.93 100 1956/57 13.53 45.64 11.4 29.43 100 1957/58 12.33 46.5 10.21 30.96 100 1958/59 10.36 44.73 10.62 34.28 100 1959/60 9.84 46.25 12.15 31.76 100 1960/61 10.18 46.08 12.1 31.64 100 1961/62 9.11 36.95 8.81 45.13 100 1962/63 11.22 45.08 10.23 33.48 100 1963/64 9.13 42.59 9.02 39.26 100 1964/65 10.02 47.17 11.45 31.36 100 1965/66 10.1 52.88 9.96 27.06 100

AllocationofStateExpenditures(1953-1966)

Unit:Millions(JD)

Civilian Services

Defense Public Security

Current Expenditures

Development Total

1953/54 13.27 2.12 15.39 1954/55 13.87 2.69 16.56 1955/56 4.34 9.35 1.28 14.97 2.76 17.73 1956/57 4.77 12.13 1.36 18.26 3.06 21.32 1957/58 6.59 11.33 1.64 19.56 4.3 23.86 1958/59 6.79 14.66 2.07 23.52 5.82 29.34 1959/60 7.85 15.81 2.34 26 4.8 30.8 1960/61 8.44 16.15 2.27 26.86 5.98 32.84 1961/62 9.34 16.42 2.29 28.05 4.94 32.99 1962/63 10.82 16.8 2.31 29.31 7.6 37.53 1963/64 12.18 18.57 2.45 33.2 6.15 39.35 1964/65 13.43 18.57 2.46 34.46 9.17 43.63 1965/66 14.12 18.76 2.84 35.72 11.27 46.99 DataoriginallyprovidedbyMinistryofFinance.204

204 IspecificallygatheredthedatainthesetablesfromMasri(2005),Appendix4,Tables1and4.

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Partiallyeveningoutthesocialeffectsofthisrevenuestrategy,however,wastheallocation

ofstateexpenditures.Thisisbecausethemillionsthatwerespentonthecivilianservice,defense,

andpublicsecurity(andthatweredocumentedinthetableabove)largelyfunctionedasa

mechanismforpublicsectorjobcreation.205Helpingmanagethedisruptivepotentialofthe

country’ssurpluspopulationsandstabilizethelargerpoliticaleconomyintheprocess,thepublic

ledgerfinancedatriplingofmilitaryemployment206andaneartriplingoftheCivilService.207

Thoughrelativelysmallinscaleinviewofwhatwastocome,thisinstitutionalizationofaquasi-

(andmilitarized)statejobguaranteegeneratedenormoussocialdividends,particularlyforthe

mostvulnerable.Inviewoftheeconomy’slackofanindustrialbaseandthelowlevelsoflabor

marketdemandthatthisimpliedforlowandsemi-skilledworkers,theeffectsofthese

expenditureswereevenmorepronounced.Complementingthecontributionstheaforementioned

parallelinstitutionshadmadeinsecuringthewelfareofcamp-dwellingPalestinians(ifonlyata

basiclevelofsubsistence),Hussein’spublicemploymenteffortstooprovidedabulwarkupon

whichthecountry’slowgrowth,peripheralcapitalismcouldstand,howeverprecariously.208

205 See:PeteMoore,DoingbusinessintheMiddleEast:PoliticsandeconomiccrisisinJordanandKuwait.Cambridge

UniversityPress,2004.p.8 Between1955and1960alone,annualdefenseexpendituresincreasedby74%.Withthevastmajorityofthese

expendituresbeingallocatedforthepurposesofexpandingtheconstellationofforcesinitiallyestablishedbyJohnGlubb(ratherthanforupgradingequipment),militaryspendingincreasesallowedforasubstantialincreaseinpublicsectoremployment.

206 Thistriplingofmilitaryemploymentoccurredbetween1960and1975.ItisdocumentedbyLawrenceTal,

Politics,theMilitary,andNationalSecurityinJordan:1955-1967.PalgraveMacmillan(2002),p.75.207 Piro,p.66:Civilserviceemploymentnearlytripledbetween1960and1985.208 Representingoneofthestate’stimeinvariantpraxesofmass-orientedactionhenceforth,thesocialefficacyofthe

Hashemite’spreferredformofpublicemploymentcontinuestobecompromisedbyitseconomicinefficiency.

115

State-Capital Relations

Astouchedonintheprevioussection,parallelinstitutionsandforeignaidwentalongway

towardssecuringthewelfareofJordan’slowerclassesinthepost-independenceperiod.Oneof

theexternalitiesborneofthiswasthatthePalace,nothavingtosecurethoselowerclasses

themselves,wasfreetoengagewiththebusinessclasseswithoutconcernforeithereconomic

efficiencyorsocialpeace.Consolidatingahighlyconciliatoryformofstate-capitalrelations,the

cronyistpartnershipthatresultedwouldgeneratehighprofitratesforadiscretegroupof

politicallyconnectedeconomicelites.Atthesametime,however,thiscronyismalsoprefigured

theeconomy’slong-termunderdevelopmentbydeepeningtheimport/consumption

dependence209ofboththecapitalaccumulationprocessandthepublicrevenuesystem.The

consolidationofaneconomybiasedagainstproductiveactivitieswouldalsoengendersignificant

andmultiformpoliticalconsequencesaswell.210

209 Incontinuingtoindulgeinnon-productiveactivities,moreover,itisimportanttonotethatJordan’smerchants

metlittlepoliticalresistance.Duetothefactthatthestate’srevenuestrategyatthisstagewasduallypremisedonexternalaidanditscapacitytolevydutiesongoodscomingintothecountry,thisimportdependencywasactuallysanctioned(ifnotexplicitlyencouraged)bypolicychoices.Theinstitutionalizationofsuchasub-optimalquidproquo,onewherethebusinesseliteandthestatebothbecameincreasinglyinvestedinaconsumption-based,import-heavygrowthmodel,was,ofcourse,developmentallydisadvantageous.Whilethereareagreatmanyissueswithimportsubstitutionindustrializationandnon-marketorientedprotectionistindustrialpoliciesmoregenerally—andwhileJordan’ssmallness,bothinpopulationandincapitalstock,wasalwaysboundtolimitthecountry’sindustrialgrowth—,itneverthelessholdsthatJordan’slong-termprospectsatthisstagestillunavoidablyhingeduponpolicymakersandbusinesselitesfindingawaytobuildanindustrialbase.Indeed,likewasthecaseforanyotherlatedevelopingeconomyatmid-century(particularlyonewithoutanysignificantnaturalresources),industrializationprovidedthemostviablepathtotechnologicalcatch-up,toincreasingthecomplexityofthecountry’sexportbasket,andtoimprovingthecountry’stermsoftrade.Byforegoingrequisitelevelsofindustrialinvestment,theimport-basedaccordbondingthisfractionofthedomesticcapitalistclasstothestateprefiguredthecountry’senduringunderdevelopment.

210 Concentratedworkforces,shopfloorpoliticaleducation,andtheestablishmentoflaborpartiesareallconducive

tothedemocraticprocessbecausetheyallhelptointegrateandsocializetheworkingclassesinamannerbefittingthestabilityofthewiderpoliticalsystem.Theabsenceofconcentratedworkforces,shopfloorpolitical

116

State-capitalrelationsofthissortwereconsolidatedandinstitutionalizedacrossanumber

ofdifferentspaces.Atthelevelofpolicyplanning,merchantsofquotacoteriestockwere

appointedtotheboardsoftheIndustrialDevelopmentBank(aPublic-PrivatePartnership

foundedin1965),theNationalPlanningCouncil(whichhadreplacedtheJordanDevelopment

Boardasof1971),andtheHousingandUrbanDevelopmentCorporation(1966).Thissame

cliquealsofilledtheleadershipoftheCentralBankofJordan,whichwasfoundedin1964upon

Jordan’sdeparturefromtheSterlingArea.211Leveragingtheinfluencetheseperchesprovided,

Jordan’smerchantcapitalwereabletoinfluencetradepolicyinparticularsotoensurethatthe

Palacemaintainedtheopennessandthesystemof(monopolized)importlicensesthathadserved

themsowellduringthewaryears.212Theseactorswerealsoabletoinsertthemselvesintothe

industrial(commodity-based)investmentsthattheJordanianstateanditsinternationalpartners

inauguratedintheseyears.Offeredequitysharesinconsiderableexcessoftheactualcapitalthey

investedinenterprisesliketheJordanCementFactory,thisprivilegedfractionofthecapitalist

classwereabletosecuresignificant(state-backed)annualdividendswhiletakingonlimited

personalrisk.Asthedividendsearnedonsaidinvestmentswerealsotax-free—andaseachof

Jordan’sbigfive(commodity-based)industrialassetswasawardedadomesticmonopolyon

extractionrights—,theseearmarkedequityholdingscamewithanumberofsecondaryadded

education,andlaborparties—allofwhichwerepartiallyderivedthroughJordan’slackadaisicalindustrialization—,leftthepoliticalprocesswithoutanymeansforintegratingandsocializingtheworkingclassesinamannerbefittingdemocracy.

211 Formoreonalltheseinstitutions,seeKnowles(2001),pp.89-99.212 Saidlicenseswouldnowextendintonew,modernproductslikeautomobiles.

117

benefitsaswell.213Whenonealsoconsiderstheeffectofa1964reformtothetaxcodethat

providedexemptionsonincomederivedfromlandsalesandpropertyrentals—areform

positioningthesesamemerchantstocapitalizeontheremittance-derivedrealestatespeculation

thatwouldtakeholdduringthe1970s214—,onecanbegintounderstandwhyaBritishdiplomat,

observingtheJordanianeconomiceliteofthe1960s,cametodescribethemasa“commercial

junta.”215

FormofMarketCompetition

Asonemayhavesurmisedfromthepreviousreviewofstate-capitalrelations,market

competitioninJordanstrayedratherfarfromtheJeffersonianideal.Giventhattheeconomywas

dominatedbycommerce216,thefactthatpoliticalinfluence(andone’ssocialproximitytothe

Palaceinparticular)wassufficientforsecuringanindividualexclusiveimportordistribution

licensesmeantthatahandfulofactorswereabletoestablishhegemonicpositionsacrossmost

retail,wholesale,andtrade-basedsectorsoftheeconomy.217Leveragingthecapitalaccumulated

213 Formoreontheseelite-orientedindustrialpolicies,see:OliverWils,“CompetitionorOligarchy?TheJordanian

BusinessEliteinHistoricalPerspective”,inManagementandInternationalBusinessIssuesinJordan(2001),p.126. Also,seePiro(1998)pp.37-54.214 Zimmerman(2017),p.111.215 Wils(2001),p.135.216 Masri’sstudyshowsthatasof1973,over2/3ofallprivateenterpriseswithequitiesover20,000JDoperatedin

commerce,and40.9%oftotalprivatecapitalwasinvestedincommerce(245).217 Leveragingpoliticalinfluenceintoexclusivelicensingarrangementsinmuchthesamemannerastheydidduring

thedaysoftheMiddleEastSupplyCentre,thepost-independenceperiodwouldseethecountry’soldmoney

118

throughtheircommercialsuccesses,moreover,thesesameactorsweresubsequentlyableto

securedominanceoverthecountry’semergentbanking,insurance,andconstructionsectorsas

well.218Byconsequence,themarketstructuresthatprevailedinmostareasoftheeconomy

duringthe1946-1973periodarebestclassifiedasoligopolisticormonopolisticinnature.Asthe

capitalrequirementsforindustrialventureswerebeyondthemeansofmostprivatesector

enterprises—andasthestatehadawardedmonopolyextractionrightstothelargelypublicly

ownedphosphate,potash,cement,andoilandgascompaniesestablishedinthisperiod—,

marketsinthesesectorsgavehosttopreciouslittlecompetitionaswell.Theaggregateeffectsof

thislargersystem,then,weretodisarticulateprofitsfrommattersofriskandinnovation,to

deepentheeconomy’sconsumptiondependence,andtorendermarketcompetitionasimple

competitionforrents.Andwhilethepost-independenceformofmarketcompetition—

underpinnedbyconciliatorystate-capitalrelationsandintracapitalrelationswhollydominated

byanelitefraction—wassufficienttogreasetheaccumulationprocessforatime,itdidsoby

deprivingtheeconomyoftheactualproductiveandcreativeenergiesitneededforlong-term

development.

maintainitscontroloftraditionalretailandwholesalemarketsandcolonizemanyoftheemergingimportmarketswroughtbyJordan’smodernization(Masri,p.283).Themostlucrativeofthesenewmarketswasthatofautomobiles,wheretheMango,Mu’asher,Taba’a,andDajanifamiliesexploitedlocalmonopoliestoextractsizablerents(Debruyne,2012,p.132).

218 Thoughnotoperatingthroughthesamecorporatestructureasthemultisectorfamilyownedcorporationsthat

emergedinSouthAmericaintheseyears,thecross-sectorbusinessholdingsandinvestmentsofthisfractionofthecapitalistclasswerenonethelesssignificant.Havingtakenupprimepositioninconstructionandfinanceaswell,themerchants’migrationfromanexclusivefocusoncommercialactivitieswouldstandthemreadytothriveduringthemassiverealestateboomthatcommencedfollowingtheinjectionofGulfcapitalinthepost-1973period.

119

Asfortheoligopolistsandmonopoliststhemselves,onewouldbeunsurprisedtolearn

thattheelite-dominatedformofstate-capitalrelationspreviouslydetailedwoundupworkingto

thebenefitoftheMandateeraquotacoterie.219AsdemonstratedinMasri’smagisterialstudyof

theJordanianbourgeoisie,bythemiddleofthe1960s,thisnarroweliteofroughlyforty-odd

familiesstillcollectivelycontrolledover54%oftheaggregatecapitalintheeconomy.220Herein,

theAsfur,Sha’sha’a,Mu’asher,AbuHassan,AbuJaber,Malhas,Haddad,Hattahit,Shuman,Ali

Bdeir,Bilbeisi,Mangu,MasriandAbual-Raghibfamiliesremainedespeciallyprominent.221This

continuedconcentrationofimmensewealthinthehandsofaselectelitetherebywidenedthe

internalfracturesthathadopenedwithinthedomesticcapitalistclassbackinthe1940s.

SocialControl

Asmentioned,theconstitutionpromulgatedduringTalal’sbriefreignin1952wasa

relativelyprogressiveone.Specifictoworkers,Article23assertedthat“Workisarightforall

219 Asmallnumberofindividualsdidmanagetobreakintothehigherreachesofthebourgeoiseliteinthisperiod.

Generallyspeaking,theydidsothroughsuccessesintheconstruction,manufacturing,and/ortransportationsectors(Masri,p.295).

220 Masri’sfiguresarecalculatedthroughmeasuringtheaggregateequitysharethatthesefamiliesheldinallextant

privateandpublicenterprisesaboveabaselinecapitalizationof20,000JD(pp.245,292).221 See:Masri(2005),p.275-277. Disaggregatingthesefiguresdowntothelevelofindividuals,Masri’scomprehensivesurveyofarchivedataatthe

MinistryofTradewouldshowthatamere179individualsheld57.2%ofallprivatesectorequityinthisperiod.Wideningthelensjustabitfurther,thesameanalysiswouldrevealthat768individualscollectivelypossessedafull80%oftotalprivatesectorequity.

RegardingMasri’smethodology,itisworthnotingthathiscalculationsexcludedtheequityholdingsofsmall

firmswithcapitalization’sofunder20,000JD.

120

Jordaniancitizens,thestatehastosecureitbysteeringthenationaleconomyandsupportingits

growth.”Italsocontainedanumberofprovisionsestablishingbasicrightsvis-a-visworking

hours,paidannualleave,unionization,childlabor,andsocialprotectionsintheeventof

termination,sickness,orinjury.Byconsequence,therewasajuridicalfoundationinplaceatthe

verystartofthepost-independenceperioduponwhichemergentworkingclassescouldadvance

theircollectiveinterestsanduponwhichalargersocialpeacemightbeconsummated.222

FollowingthepassageoftheLaborTradeUnionsLawNo.35in1953,apieceoflegislation

establishingthatanygroupofsevenormore(whetherunitedbyprofessionorplaceofwork)had

therighttounionizeandtostrike,aratherrobusttradeunionmovementdid,infact,riseand

consolidateconsiderableinfluenceinthehopefulanddemocraticenvironsofpre-1957Jordan.By

1954,sixoftheearliesttradeunionscoalescedsotoformtheGeneralFederationofJordanTrade

Unions(GFJTU),andworkingclassorganizationallifereallybegantoflower.Withinayearofthe

GFJTU’sfoundation,thetotalnumberofstate-recognizedlaborunionshadgrowntothirty-six,

twenty-fiveofwhichweremembertotheGeneralFederation.Adoptinganactivepoliticalroleas

well,Jordan’searlylaborandtradeunionsweremajoralliesofthenationalist,pan-Arabist,and

leftistpartiesthenthrivingduringJordan’sbriefdemocraticopening.Alliestothegovernmentof

Suleimanal-Nabulsiinparticular,thelaborunionmovementbackedthePrimeMinisteras

tensionsescalatedwiththePalace—andasthePalaceoptedtoexecuteitscoupagainsthimin

Aprilof1957.223

222 HaniHourani,TheJordanianLabourMovement,FriedrichEbertStiftung(2002),p.12.223 Hourani(2002),pp.12-15.

121

Giventheseallegiances,itwouldbeunsurprisingwhentheKing’sgeneralizedpost-1957

counterrevolution,impositionofmartiallaw,andcancelationofdemocracybroughtJordanian

laborintothecrosshairsofJordan’sreactionaryturn.Duringthecrackdownofthelate1950sand

early1960s,manylaborleaderswereforcedintoinvoluntaryexilesinSyriaandEgypt.Having

ascribedcommunistagitationnotonlytotheleadershipcadrebutalsototheunionasan

institution,thePalacewouldnextlaunchedamorewholesalecampaignagainsttheGFJTUandits

membership.Byconsequenceofthesemachinations,asof1961,thenumberofactiveunionsin

Jordanwasreducedfromthe1956highofthirty-ninetoameresixteen.Throughsuchaculling,

thenumberofworkersrepresentedbyunionswasreducedtoatotalof9,000.

Thepoliticalthawingthatbeganlaterthatsameyear(1961)didbrieflyreverselabor’s

fortunes,especiallyfollowingthepromulgationLaborLawno.21.Withinfiveyears,thenumberof

unionsrecognizedbythegovernmenthadrecoveredtoahealthyfigureofforty.Withinnine

years,unionmembershiprollsquadrupledfromthelowsof1961aswell.224Alas,whatpolitical

momentsgivethpoliticalmomentstaketh,thistimeupontheoutbreakof1970-1971’scivilwar.

HavingalignedthemselveswiththeFedayeen—anunsurprisingoutcomegiventhattheunions

representedmanyofthesameleftistforces,TransjordanianandPalestinian,asdidthe

paramilitarygroups—,theregimehadthejustificationitneededtomoveagainstthelabor

movementwithunprecedentedlevelsofforceandcomprehensiveness.

Thepost-1970repressionofthetradeunions—andthepost-1970institutionalizationof

socialcontrolinJordan—wascarriedoutinanumberofsteps.Tobegin,followingBlack

224 Ibid,pp.13-14

122

September,laborissueswouldsubsequentlycomeunderthejurisdictionandauthorityofa

specialdepartmentattheGeneralIntelligenceDirectory(GID).Thisadministrative

reorganizationmeantthattheworkers’portfoliocametobedealtwithundertherationalitiesof

domesticsecurity.SubjectedtothetactileandcoerciveprerogativesoftheJordanianmukhabarat,

theactivitiesofworkingclassinstitutionswouldswiftlygroundtoahalt.225Complementingthe

physicalityofthisfirstdimensionofpost-1970socialcontrolwereahostofmoresubtle

interventionsaswell.In1971,theMinistryofSocialAffairsandLabordissolvedthe

democraticallyelectedExecutiveCommitteeoftheGFJTUandreplaceditwithacommitteeof

comprisedofgovernmentselectedappointees.Buildinguponthismoveagainstlabor’sleadership

class,throughaseriesofsubsequenttemporarylaws(specifically,TemporaryLaborLaw67and

Decree14/K1/1971),theMinistrynextgranteditselftheauthoritybothtointerfereinthe

internalaffairsofthetradeunionsandtodisestablishthoseunionsdeemedpoliticalactiveor

involvedinthe“propagationofdestructiveideologies.”226Inthismanner,thelessdocileamongst

Jordan’stradeunionswereeitherdisbandedormergedwithamoreobedientoutfit;withina

year,thetotalnumberofunionsoperatinginthecountrywasreducedtoseventeen.Whatis

more,asatroikacomprisedoftheMinistryofLabor,theGFJTU,andtheChambersofCommerce

andIndustryweresimultaneouslyempoweredtoadjudicatetherecognitionofanysubsequent

unionizationefforts,thatstate’sinterventionismalsoallowedforatightregulationofthefreedom

ofassociationgoingforward.Wieldingtheseregulatorypowerswithanironfist,since1971,the

225 Ibid,p.69226 Ibid,p.15

123

statehasrefusedtorecognizeasinglenewunionbeyondtheco-optedseventeenunderits

thumb.227Inadditiontoinvestingitselfwiththeauthoritytoissueinjunctionsagainststrikesand

thepowertolevyfinesandcriminalchargesagainststrikeorganizersandparticipants,the

Ministrywouldalsoillegalizestrikesinvitalindustriesatthistime.228

Throughanumberofadministrativeandlegalmaneuvers,theindependence,

representativeness,andpoliticalefficacyoftheJordaniantradeunionmovementwasbroughtto

adecisive,unambiguousend.229Withadocile,co-optedeliteplacedinpositionsofleadership

withintheindividualunionsandwithintheGFJTU,socialcontrolwouldhenceforthbepreserved

throughtheMinistry’smaintenanceofthisdisarticulationbetweenJordan’slaborinstitutions

andthecountry’sworkingclasslife.230

ExternalArticulation:Engagingwiththeregionalandinternationaleconomies

TheexternalarticulationoftheJordanianeconomyduringthisperiodwasdefinedbytwo

principalattributes:(1)Amodalityofregionalandglobalintegrationthatwasgenerativeof

structuraltradedeficitsand(2)Abudgetstrategythatrenderedthestatefiscallydependenton

externalsources.231Regardingthefirstoftheseattributes,whileanumberoftariff-related

227 AhmadAwad,“Jordan’sParadoxicalApproachtoTradeUnions”,PhenixCenterReport(2017),p.4228 Aruri,p.108;Hourani,p.70.229 Ibid,pp.15-21230 Awad(2017),p.2.231 Itisalsoworthnotinghowthestate’sbudgetarydependence(andthemoregeneraldependenceofthestate)

manifestedinthesecuritysector.ThemartialdependenceofthestatewasofcoursebestpersonifiedbyPasha

124

restrictionsontradewereimposedthroughouttheperiodunderexamination,suchmeasures

wereprimarilyimplementedforthepurposeofrevenuegeneration(ratherthanforthepurpose

ofnurturingdomesticindustry).Stayingwellawayfromtheimportsubstitutionindustrialization

(ISI)modelsthenenvoguethroughoutthethirdworld,Jordanlargelyacceptedtheconventional,

US-backedwisdomofcomparativeadvantagewhenitcametotradepolicy.Theadoptionofthis

tradestrategyresultedinunprecedentedinflowsofconsumeritems232(aswellasincreased

inflowsofcapitalgoods)andtheconsolidationofanexportbasketcomprisedprimarilyof

agriculturalgoodsaswellasvolatile,relativelylow-pricedcommoditiessuchaspotashand

phosphates.233Thecontentandmagnitudeoftheserespectiveinflowsandoutflowsyielded

consistentandconsiderabletradedeficits.By1964,theannualdeficitonthetradebalancehad

reachedJD40.7million.Twoshortyearslater,ithadjumpedallthewaytoJD56.8million.Asof

1973,itclimbedwithinafewwhiskersofJD100million.

JohnGlubb,whoretainedauthorityovertheJordanianArmedForcesupandthrough1956.Itwouldcontinue,moreover,evenafterGlubb’sdismissalandtheabrogationoftheJordan’smilitarytreatywithBritain.ItwastheAmericansandDulles’StateDepartmentthatmateriallysecuredtheKingwhenhemadehismoveagainsttheNabulsigovernmentin1957.ItwasBritishparatroopersthatlandedinJordanin1958followingthecoupagainsttheIraqiKing,moreover,furthercontinuingtheexternalizationofHussein’spraetorianguardianship(Dann,89-90).Finally,itwastheAmericansand,covertly,theIsraelisthatagainsecuredtheregimeagainstthePalestinianFedayeenandtheirinternationalsupportersin1970-1971.

232 Importsincreasedby36%between1964and1966alone.Duringthisperiod,therateofgrowthseeninthe

aggregatevalueofimportedconsumeritemsoutpacedpopulationgrowthrates(Masri,142).233 Between1964and1966,agriculturalgoods(fruits,vegetables,andoliveoil,primarily)constituted58%ofall

commodityexports.Subsequenttothat,phosphates(anditsderivativeproducts)cametodominatetheexportledger.

Masri,p.141

125

DataoriginallyprovidedbyJordanianDepartmentofStatistics.234

DataoriginallyprovidedbyJordanianDepartmentofStatistics235

234 IspecificallygatheredthedataforthesechartsfromMasri(2005),Appendix4,Table8.235 IspecificallygatheredthisdatafromMasri(2005),Appendix4,Tables21-25.

126

Asforthegovernment’sbalancesheet,externalbudgetarydependencenotonlyleftthe

stateinapositionwhereitsdevelopmentambitions(andcapitalspendingmorespecifically)

wereatthewhimsofforeigndonors236;italsogreatlyaffectedtheforeignpolicychoicesavailable

toJordan’spolicymakers.Theregime’srelianceonGulfbudgetaryaid,forinstance,pushedthe

KingintoabindwherehewasforcedtodispatchJordanianmilitarytoSaudiArabiaandKuwait

forthepurposesoftrainingthosecountries’respectivemilitaries—andforthepurposeofstaffing

thepersonalsecurityofthetworoyalfamilies.237ThoughBrandandRyanhaveshowedhowdeft

theKingprovedinmanagingtheIsraeliquestionandthedifferentplayersinArabregional

conflictsinthepost-1973period,thestate’sincapacitieswhenitcametoraisingdomestic

revenuesneverthelessmeantforeignpolicydecisionswouldalwaysneededtobeevaluated

throughconsiderationoftheinterestsofJordan’sforeignsponsors.

SourcesofGovernmentRevenues,1953-1966238 Unit:%ofTotal

Domestic Revenue

External Budget Support

Development Grants

Foreign Loans

1953/54 36.19 63.81 0 0

1954/55 42.44 57.56 0 0 1955/56 42.31 47.51 1.75 8.43

1956/57 41.14 43.89 7.58 7.39

236 BritainprovidedthemainsourceofbudgetsupporttoJordanpriorto1957,atwhichpointtheUnitedStatestook

onthebruntoftheresponsibility.ThoughessentialtothemaintenanceofHussein’sruleintheaftermathofhiscoupagainsttheNabulsigovernment,onceconfidentthatleftistforceswerenolongercapableofthreateningthemonarchy,Americanassistanceeventuallybegandeclining(andsharplyso).Thisleftpost-1962Jordaniangovernmentswithashortfallinrevenue,ashortfalltheywouldonlybeabletomakeupfollowing1967(andtheinfluxofGulfsupport)and1970’sBlackSeptember(andthere-influxofAmericansupport).

237 Brand(1994),pp.87-93;124-134.238 DataoriginallyprovidedbyMinistryofFinance.IspecificallygatheredthisdatafromMasri(2005),Appendix4,

Table3.

127

1957/58 38.95 55.85 3.86 1.33

1958/59 35.57 53.58 7.16 3.69 1959/60 42.03 48.58 1.51 7.87

1960/61 44.01 52.27 3.56 0.16 1961/62 44.05 48.61 5.86 1.48

1962/63 54.31 37.81 2.63 5.25 1963/64 53.3 38.5 4.62 3.58

1964/65 51.57 29.6 3.72 15.1 1965/66 59.95 28.8 5.45 5.81

Jordan’sForeignPatrons(1964-1973)

Units:ThousandsofJD

Tablesprovided

byBrand

(1994),pp.44-

45

128

Ideology

InlegitimatingboththeJordanianmodalityofcapitalismandtheHashemite’sstewardship

oftheeconomyandnationduringthisperiod,KingHusseinetaladoptedanumberofdifferent

ideologicalscripts.Regardingpoliticallegitimacy,heandhisPalaceinitiallyplayeduptheKing’s

pan-Arabistcredentials—primarilysotofendofftheNasseristchallenge.Between1948and

1969,theregimealsopositionedtheKingastheunifyingpersonageembodyingandguidingthe

Palestinian-Jordanianunion.239Intheaftermathof1970-1971,politicallegitimationpivoted

towardsTransjordanianchauvinism,tribalism,andtraditionalismwithatouchofreligiosity.240

Unsurprisinggivenhisregionalalignmentwitharoyalist,conservativeaxisandgiven

Jordan’spositioningontheAmericansideoftheColdWar,Husseinetal.’sideologicalpositionson

theeconomypartiallydrewuponliberaltropesregardingmarketsandbusinessmen.Thiswas

mostobviouslyevincedintheeffortsheandhischiefpolicymakerstooktointerpellatethe

domesticbourgeoisieasthesingularagentofdevelopmentandprogress—,aswasevincedinthe

fawningtreatmenttheprivatesectorwasgivenineachofthethree,five,andsevenyeareconomic

planspublishedbetween1962and1986.241Alongwitharticulatingthesemoreliberalpositions,

239 MohammedAliOudatandAymanAlshboul,“’JordanFirst’:Tribalism,Nationalism,andLegitimacyofPowerin

Jordan”,IntellectualDiscourse(18:1),2010,p.73.240 RobertSatloff,FromAbdullahtoHussein,p.49-50.Seealso:Massad(2001),pp.207-263,241 Eachoneofthesedocumentsinvariablypronouncedthattheprivatesectorwouldbethekeytodevelopmentand

thattheprivatesectorwouldtaketheleadintermsofproductiveinvestment. Thiswasso,ofcourse,despitetheJordanianbourgeoisiehavingabnegatedthehistoricalroletraditionally

incumbentuponitsclass,anabnegationmanifestinboththeJordanianbusinessclass’rentseeking,itsdisinterestinindustrialinvestment,anditsdisinterestindemocraticgovernance.

129

Husseinetalwerewasalsoconsistentinmakingideologicalappealsgroundedinthepost-

colonialliturgyofwelfarismanddevelopmentalism.Speechesanddevelopmentplanspublished

bytheregimeconsistentlyexpressedthesentimentthateconomicgrowthnottobeconceivedof

asanendintoitself—butasameanstowardsadvancingthecollectivewelfare.Pairedwiththis

claim,moreover,wasasecondonemoredirectlyhedgingagainsthispreviouslyarticulated

liberalism,onesuggestingthatmarketswereonlydesirabletotheextentthattheyimproved

collectivesocialwelfare,andonechargingthatthestateneededtotakeanactiveroleininsuring

thatsuchimprovementswererealized.242ArticulatingthesameRooseveltianbalanceaswas

evincedinhispublicsectorhiringpolicies—andintheconstitution’senshringofagovernment

jobs’guarantee—,theseaddendatohiscoreideologicalpositionstherebyelevatedthestate

alongsidethebourgeoisie,positingthatneitheronenortheothercouldbefullysufficientin

drivingthecountry’smodernization.Takeninconjunction,itcouldthereforebeargued(asMazur

has)thatHussein’sideologicallegitimationoftheeconomyemphasizedasynthesiswherethe

“fundamentallyfree-enterprisephilosophy(oftheKing)wasfusedwitha‘benevolent

paternalism’involvingahighdegreeofadministrativediscretion.”243

CrisisandCollapse:Theendofthepost-independenceSSA

Notwithstandingthemanyissueswiththepost-independencesocialstructureof

accumulation—includingtherelativelylowlevelsofcapitalaccumulationthatit

242 Scheyagh,p.430.243 Mazur(1979),p.235.

130

institutionalized—,itheldrelativelysteadyforthefirsttwentyyearsofJordan’spost-colonial

existence.Asintimatedthroughoutthischapter,however,thisSSAdidindeedcomeundoneunder

thepressureoftwoseparatepoliticaleconomiccrises.

Asmentioned,thefirstofthesecrisesoccurredin1967,whenJordan’sparticipationinthe

ArabwareffortagainstIsraelcostittheWestBankandJerusalem.Theeconomiceffectsofthis

losswereenormous.Priorto1967,theWestBankhadcontributedroughly33-38%ofJordan’s

annualgrossdomesticproduct.Havingcomprised55%ofJordan’sservicesector,43%ofitsretail

andwholesaletradesectors,41%ofitsrealestatesector—andhavingcontributedbetween10-

18%ofindustrialoutputandmorethan33%ofthecountry’selectricityandagricultural

output—,thiscontractionhitvirtuallyeveryareaoftheeconomy.244Whatismore,giventhatthe

WestBankhadalsoconstitutedmorethan40%oftheeconomy’sdomesticconsumermarket,its

losswouldalsogreatlyreducedemandforJordaniangoodsgoingforward,whethertheybe

producedbypublicorprivatefirms.Industrialfirms—particularlytheJordanianPetroleum

RefineryCompanyandtheJordanianCementFactory—sufferedmostacutelyduetothelossof

thisconsumerbase,onlyfurthersettingbackthecountry’sdelinquentindustrialization.245

Tomakemattersevenworseforanalreadyflailingeconomy,theIsraelioccupationofthe

WestBankalsoprecipitatedasecondwaveofrefugeemigrationintoJordan.Intotal,anestimated

300-400,000PalestinianswoundupcrossingtotheeasternsideoftheriverJordanfollowingthe

(illegal)Israeliconquestof1967.Thoughmanyoftheserefugeeswereabsorbedintothe

244 Masri(2005),p.194245 Mazur(1979),p.212

131

infrastructureoftheUNRWA’srelativelyautonomouspoliticaleconomy—andwhileothersfound

materialsecuritythroughjoiningtheranksofthePalestinianfedayeen—,thismassiveinfluxof

populationstillputanenormousamountofstrainonsocial,political,economic,andecological

fabricsthatwerethreadbaretobeginwith.Ontheeconomicfront,thisstrainwasmostdirectly

feltinthelabormarket,whereaprolongedunemploymentcrisiswouldstubbornlypersistupand

throughthemid-1970s.WiththeUnitedStatesalsoadoptingpunitivemeasuresinresponseto

Jordan’sparticipationinthepan-Arabwareffort—measuresprincipallymanifestinthefreezing

ofitsbudgetsupportandtheceasingoftechnicalassistance—,theprecarityofbothregimeand

societywasonlydeepened.

Alreadyflatliningduetotheshocksandupheavalsof1967,theeventsof1970-1971only

acceleratedthedeathspiralthattheJordanianeconomyhadalreadyfalleninto.Thoughthe

regimeultimatelyprovedvictoriousinthecivilwaritwagedinthoseyearsagainstaloose,

disorganizedcoalitionofPalestinianparamilitarymovements,victorywassomewhatPyrrhicin

thatitalsoresultedinJordan’sbanishmentfromthewiderregionaleconomy.AstheFedayeen

wereexiledtoLebanon,SyriaandIraqwouldrespondbyclosingtheirborderstoJordanian

exports,SaudiArabia’sbyshuttingofftheTAPline—whosepassagethroughJordanianterritories

hadprovidedthegovernmentwithakeysourceofrevenues—,andLibyaandKuwaitby

curtailingtheirannualaidpayments.Noteventherecommencement(andsizableincrease)of

Americanexternalsupportcouldstoptheresultingdriftintocontractionanddepression.246

Foreignreservesshortages,fiscalinsolvency,andthebankingsystem’scollapseredoundedoff

246 Forthishistory,seeKnowles(2001),p.91

132

oneanothersotoproducedepressionlikeconditions,andtheviabilityofboththenational

economyanditsHashemitemindersappearedtenuousatbest.247

Alas,thewhimsicalityofinternationalpoliticswouldeventuallyturninthePalace’sfavor

andinsodoingoffertheJordanianeconomyalifelineinitsmomentofdesperateneed.Critical

herewastheArabwareffortagainstIsraelin1973.AsthememoryofBlackSeptemberfadedand

Jordanwasrevalorizedasafrontlinestatewithinthisrenewedregionalconflict,thePalacefound

itselfratherauspiciouslypositionedwithinaregionaleconomypoisedtoexpandmanytimes

overfollowingtheexplosionofoilpricesinthepost-1973period.

Henceforththerecipientofunprecedentedlevelsofofficialexternalassistance,

remittances,andlowinterestloans,capitalaccumulationrateswouldtickupwardacrossthe

1970s.Theydidso,however,throughaformofcapitalismthatwassubstantiallydifferentthan

thepre-1973iteration.Flushwithcash,thePalace—nottheelitefractionofthecapitalistclass—

wastobecomethelargestandmostinfluentialactorintheeconomy.Consolidatingasystemof

whatKnowleshascalledinducedstaterentierism,theHashemitepoliticaleconomywould

therebyevolveintoaderivative,poorman’sversionofthecapitalismstakingrootintheGulfat

thesametime.248Facilitatedintheseeffortsbyanextremelyfavorableexternalenvironment—

247 WhilethecrateringoftheeconomyinevitablyaffectedJordan’spoortoagreaterextentthananyoneelse,the

effectsofthismultilevelquagmirewerealsoacutelyfeltbytheelitefractionofJordan’scapitalistclass.Inastateoftorpidityifnotexistentialdespair,theyearsbetween1967and1973wouldseetheirinvestmentscease,theirbusinessactivitiespause,andtheircontributionstogrossfixedcapitalformationdriftintonegligbility.AsArabBank—byfarthebiggestfinancialinstitutioninJordan—wasownedbyAbdelMajidShoman,anethnicallyPalestinianindividualknowntohavemaintainedacloserelationshipwiththePLO,theregime’swarontheFedayeenwouldgenerateuncertaintyinhighleverageplaces,uncertaintythatinturnprecipitatedthiscollapseininvestment.Withthedomesticcapitalistclassshortonconfidenceandcapital,itwouldlargelycedealleconomicagencytothePalaceoverthecourseofthenextfifteenyears,asIwilldetailinthenextchapter.

SeeMasri(2005),p.212andPiro(1998),p.62,formoredetails.248 Knowles(2001),p.110.

133

oneprovidingbothaninfluxofcapitalandalabormarkettoabsorbthehighandlow-skilled

ethnicPalestiniansthatwereabouttobemadeincreasinglyprecariousthroughthepost-Black

Septemberpracticesofthestate—,arevitalized,reintegratedstructureofsocial,political,

economic,andideologicalinstitutionswassoontobeestablished,astructurethatwouldstabilize

JordaniancapitalismasmuchasitdiditsHashemitecustodian.

AsIwillshow,itwasalsoatthistimethatHussein’sembeddedneopatrimonialismmaturedintoitsfinalform.

Driveninnosmallpartbyabrieflymobilizedmilitarycoupin1974—onethatsawtheverysameactorsthathadjustsecuredtheKing’sthronethreeyearspriornowthreatentochallengehisrule—,theKingwouldincreasepublicsectorhiring,increasepublicsectorwages,andestablishauniversalsystemofsubsidiesandpricecontrolssotosecurethematerialwelfareofhundredsofthousands,withspecialbenefitsgiventohisethnicallyTransjordanianallies.

134

CHAPTERFIVE

Oil,inducedstaterentierism,andJordan’ssocialstructureofaccumulation:1973-1986

Aswasdetailedatthecloseofthepreviouschapter,despiteholdingrelatively(and

surprisingly)steadyfortwenty-oneyears,thepost-independenceSSAultimatelycollapsedunder

theweightofthepolitical-economiccrisesof1967and1970-1971.Thoughtheprovenanceof

thesecriseswereexogenoustoJordan(atleastinpart),theyneverthelesscatalyzedarather

profoundtransformationinthecountry’sendogenouseconomicorganization.Thepost-1973SSA

thateventuallyemergedconsolidatedandstabilizedanentirelynewmodalityofcapitalisminthe

HashemiteKingdomofJordan.

Aswillbedetailed,thestabilizationandgrowthofJordan’snewcapitalismwerelargely

achievedthroughexternallyfinancedcurrentexpendituresandhighratesofprivate

consumption.249Byvirtueofthesespikesinstateandhouseholdspending,aggregatefinal

consumptioncametoaverageapproximately111%ofGDPbetween1973and1986—andthe

economy’sexpansioncametobewhollydisarticulatedfromdomestictotalfactorproductivity,

whichwasstagnantacrosstheperiodunderexamination.250Thedivergenceofprofitratesand

capitalaccumulationfromTFPwouldofcourseprovedeeplyproblematicforlong-term

development.

249 TotheextentthatconsumptionwasitselfunderwrittenbythereceiptofGulf-originatingremittances,moreover,

ittooshouldbeconceptualizedasaderivativeoftheexternalenvironment.250 Masri(2005),p.342 ThisstagnationinTFPoccurredinspiteofpublicexpendituresprovidingforrelativelyhealthyratesofgross

fixedcapitalformation.

135

Boththenon-realizationofTFPgainsandJordan’smoregeneralsquanderingofitspetro-

derivedinflowscanbeexplainedbythenearsightednessoftheregime’spoliticalsurvival

strategy.Thisstrategyinstitutionalizedasystemwherebythecapitalthatwasmadeavailable

throughexternalaidandremittanceswasfunneledintoallocativeandpatronage-related

activitiesratherthanproductiveones;italsotradedlong-terminvestment,planning,anddelayed

gratificationforthesocialopiateofimmediateconsumptionandeliterent-seeking.Similarly

problematic,italsorefastenedthedependencythatboththePalaceandthecapitalistclasshad

developedvis-a-vistheimportmarket.Asprivateprofitrates,thedomesticrevenuesofthe

Palace,andtherent-seekingstrategiesofaninstitutionallyweakenedbureaucracyeachcameto

(directlyorindirectly)requirethereproductionofmassivetradedeficits,theinstitutional

interestsofeachsuchactor/organizationalsocametorequiretheenduringunderdevelopmentof

theeconomy.Byconsequence,muchoftheboomthatwasinherenttopost-1973capitalinflows

evaporatedintohouseholdconsumption,governmentspending,andinflation(especiallyinthe

realestatesector251).

ThestabilizationofcapitalaccumulationprovidedbythisSSAcouldonlybutbebrief,

then,aswellasbeingfundamentallyvulnerabletoexogenousshocks.Oncesuchshockscame

throughthecollapseofoilpricesintheearly1980s,Jordaniancapitalism(anditsauthoritarian

251 AsdetailedinapublicationofthePrimeMinster(atthetimeofwriting)OmarRazzaz,landpricesroseby500%

between1970and1976,andthenbyanother500%between1975and1985(OmarRazzaz,“ContestedSpace:UrbanSettlementaroundAmman”,MiddleEastReport1993).

SeeKnowles(2001),p.106onthebuiltenvironment’sshareoffixedcapitalformationduringthisperiod.

136

overseer)wouldenterintoanotherlongperiodofcrisis,onethathasbeenstabilizedthough

neverentirelyescaped.

Organizationally,thischapterwillcloselyfollowthestructurelaiddownduringmyreview

ofJordan’spost-independencesocialstructureofaccumulation.Afteragainbeginningwitha

reviewofthepoliticaldomain,Iwillproceedtoanalysesof(I)theparticularformofeconomic

interventionismadoptedbythestateduringthisperiod;(ii)theparticularformofstate-capital

relationsconsolidatedduringthisperiod;(iii)theformofmarketcompetitionconsolidated

duringthisperiod;(iv)thesocialcontrolregimeconsolidatedduringthisperiod;and(v)the

externalarticulationoftheeconomyduringthisperiod.Aswaspreviouslythecase,Iwillalso

concludethischaptermydeconstructinghowthissocialstructureofaccumulationeventually

gaveway,thetimeinthelate1980s.Theonlysubstantiveanalyticaldifferencebetweenthetwo

chapters,then,isthatthisonewillomittheideologicalinstitiutionalizationofcapital/powerfrom

consideration.Thischoicewasmadeonthebasisofthefactthatideologicalinstitutionalization

waslargelyinvariantacrossthetwoperiodsunderexamination.252

………………………………………………………………………………………………………………………………………………………..

ThePoliticalInstitutionalizationofJordan’sNewCapitalism:InsulatingPolicymaking,the

HegemonyofthePalace,andtheDeclineoftheRationalistState

252 Despitebeingpublishedinthemidstofaneconomiccrisisgatheringspeedwitheachpassingday,the1986Five

YearPlannotonlyarticulatedtheverysameoptimismashadpreviousplanningdocuments,butalsoreinflatedthisimaginaryofprogressandmodernizationachievedthroughthehealthyandefficientbondofbusinessclassandstate.

137

Politicsproperinthepost-1973periodremainedorderedbythelogicofemergencyand

executivesupremacy.Theillegalizationofpoliticalassociationstayedineffectthroughthemid-

1980s,andparliamentarylifecontinuedoninitsstateofpermanentabeyance.Having

reproducedsuchinstitutionalandorganizationalvacuums,theKingandhisallieswerefreeto

rulethroughroyaldecreeandtheissuanceofprovisionallegislation.Keentopreventany

alternativepowercenterfromemerging,thoseallieswouldthemselvesbemanagedthroughelite

circulationandco-optation.253

Theinstitutionalizationofsuchanaristocraticallystyledsystemofhousepoliticssawtoit

thatindividualssuchasZaydal-Rifa’i254,MuhammadShafiq255,MudarBadran256,WalidAsfur257,

253 Thoughsomeoftheoldmerchantelitewereincludedinthissystemofelitecirculation,theseactorsfound

themselvessomewhatpoliticallyrelegatedduringthisperiod.Whichisnottosaythatsuchelitesdidnotbenefitfromthepoliciesimplementedatthisstage,asIwilldetail.

254 Rifa’iwasappointedPrimeMinisterin1973atthetenderageof36.255 ShafiqservedanumberoftermsasMinisterofFinanceandwiththeNationalPlanningCouncil(abodylater

reorganizedastheMinistryofPlanning).256 BadraninitiallyservedasMinisterofEducationinRifa’i’sgovernment.HetoowouldserveasPrimeMinister

between1976-1979and1980-1984.257 AsfurservedasChairmanoftheJordanFertilizersIndustriesCompany,MinsterofIndustryandTrade,andasa

boardmemberontheJordanCementFactoryCompany,amongsthisotherposts.

138

Alial-Nusr258,Umaral-Nabulsi259,Mahiral-Shukri260,ZiadFariz261,HanaAwda262,andAhmad

Ubaydat263wereshuffledinandoutofpositionsofprominence,whetheringovernment,atthe

RoyalCourt,oramongstJordan’sgrowingnumberofstateownedenterprises(SOEs).264Though

theconstantshufflingwassuccessfulinachievingitsprimaryobjective—preventingthe

emergenceofsecondarypowercenters—,suchanachievementcameattheexpenseofpolicy

coherence,organizationalcompetence,andlong-termplanning.Asthisrelatestoeconomic

policymakinginparticular,inconjunctionwiththedeepeningdisjunctureofgovernmentfrom

thedemos,thedegradationofthebureaucracythatwasbroughtaboutthroughtheKing’selite

shuffling265createdthespaceforanumberofnewautonomous,Palace-alignedpolicymaking

bodiestoemergeandaccrueconsiderableinfluenceovertheplanningprocess.

258 Al-NusrsatontheboardsoftheJordanCementFactoryCompanyandtheJordanFertilizersIndustriesCompany

aswellasservingasMinisterofPlanning.259 Al-NabulsiservedasMinisterofAgricultureinRifai’sfirstgovernmentinadditiontosittingontheboardofthe

ArabPotashCompany.260 Al-ShukrisatontheboardsoftheJordanCementFactoryCompany,theArabPotashCompany,andtheJordan

FertilizersIndustriesCompanywhilealsoservingasDeputyDirectoroftheCentralBankofJordan.261 FarizsatontheboardoftheArabPotashCompanybeforetakingupseniorpositionsintheMinistryofFinance

andattheCentralBankofJordan.262 AwdaservedasSecretaryGeneraloftheNationalPlanningCouncil,asMinisterofFinance,andasChairmanof

theJordanFertilizersIndustriesCompaniesamongsthisotherposts.263 UbaydatwasPrimeMinisterbetween1984-1985.264 Foremoreonthisnewgenerationofpollicymakers,seePiro(1998),p.63.265 Thisdisarraywascompoundedbythefactthattheearliergenerationofrationalistpolicyplanners—best

representedbyWasfial-Tal—hadfallenoutoffavorwitharegimenowflushwithcash(andthereforelessconcernedwithwhatameritocratic,efficientstateapparatuscouldoffer).

139

FirstamongstthesePalace-alignedinstitutionswastheEconomicSecurityCommittee

(ESC).StewardedbyCrownPrinceHassan,theESCwasestablishedatthebehestofCentralBank

GovernorDr.Khalilal-SalimfollowingthelossoftheWestBankandbroughtintoofficialexistence

withthepassageofa1971PlanningLaw.WithaboardofdirectorscomprisedoftheMinisterof

Finance,theMinisterofTradeandIndustry,theMinisterofTransport,andtheaforementioned

GovernoroftheCentralBank,theinstitution’sofficialmandatewasaconsultativeone.Though

investedonlywiththeauthoritytoaidthegovernmentasitnavigatedthechallengesbornofthe

naksa,theESCquicklyoutgrewanysuchlimitedbailiwick.266By1974andwithafullRoyal

blessing,theESCwasoperatingasbothanunelectedlegislatureandactivistappendageofthe

executivebranch.Henceforth,theESCoverturneddisagreeableexistinglegislation,decreednew

lawatitsowndiscretionandwithoutpublishingthecontentsofsaidlawsinthestate’sOfficial

Gazette,dissolvedandreappointedtheboardsofpublicshareholdingcompanies,anddictatedthe

borrowingandlendingbehavioroftheCentralBank.Insodoing,theESCmorethananyother

policybodycametodefinethejuridicalfoundationsforthecountry’snewcapitalism.267

SupportingitintheseeffortswasasecondPalace-alignedpolicybodymidwifedinto

existencebythesameCrownPrinceHassan.FoundedpriortotheESC(in1970),theRoyal

ScientificSociety(RSS)wasinvestedwithamandateexplicitlycenteredonlong-term

266 OntheoriginsoftheESC,see:Brand(1994),p.67;Knowles(2001),p.97;Masri(2005),p.211.267 ItisworthnotingthattheESCalsooversawthebusinessoftheJordan-IraqCommitteeforEconomicCo-

ordination.AsIwillshow,thiscommitteefunctionedasoneofthecriticalmechanismsinthePalace’selite-orientedpatronagestrategy(Brand,1994,p.68).

140

developmentplanning.268AstheRSS’sseniorstaffwascomprisedofprominentindividuals

simultaneouslyservingontheboardsofthecountry’sindustrialSOEs269,however,conflictsof

interestandadegreeofmyopiawerebakedintotheinstitution’spolicyprocess.

Notwithstandingtheseissues,therewereanumberofhighlycompetentpeopleemployed

attheRSSduringtheseyears.270BassamAsfur,headoftheRSSin1978,forinstance,evincedsuch

competencebyadvisingtheKingtomovetheeconomyawayfromitsdependenceon

consumptionandtheservicesector.Bassamal-Sakat,headofitsEconomicsDepartment,

moreover,evincedhisbycautioningCrownPrinceHassanagainstcontinuingaloosecredit

systemthatwasmerelyfeedinganinflationary,speculativebubbleinrealestate.271Regardlessof

themeritsofitspersonnel,however,totheextentthattheRSStoowasdesignedtobeboth

institutionallyautonomousanddirectlyaccountabletothePalace,ittoocontributedtothe

witheringofJordan’sdevelopmentalistbureaucracy.

TheStateintheeconomy

Inordertobettersociallyembed(andtherebystabilize)themarketinthepost-1973

period—andinordertoensurethatprofitsflowedintotherightpocketsandatsufficient

268 ItwouldbetheRSS,then,ratherthantheappropriategovernmentministry,thatauthoredthetwoseminal

strategicdocumentsofthisera—1976and1981’srespectivefive-yearplans.269 Bassamal-Sakat,forexample,servedasChairmanoftheJordanCementFactoryCompanyatthesametimethat

heheadedtheEconomicsDepartmentattheRSS.270 AshasbeenthecaseacrossJordanianhistory,itshouldalsobenotedthattheRSS’developmentplanswerenever

faithfullyimplemented,atleastinfull.271 Piro(1998),p.71

141

levels—,thestatescaledupbothitsmass-orientedandelite-orientedinterventionsinthe

economyconsiderably.Italsodiversifiedtheinstitutionsthroughwhichtheseinterventionswere

implemented.

ConsolidatingwhatKnowlesclassifiedasaformofinducedstaterentierism,thisnew

modalityofinterventionprovedbothsociallyeffectiveandeconomicallymisguided,ensconcing

allocativestatepracticesratherthanproductiveandfurtheringthedisjunctureofconsumption

fromproduction.Throughentrenchingarevenuestrategyduallypremisedonexternalaidand

thedirectandindirectleviesthatcouldbeimposedonimport-basedconsumption,thisinduced

staterentieirismalsolockedboththestateandthebourgeoiseliteintoanincreasingdependence

oncommercialarbitrage.272Bymoregenerallyconsummatingthedivorcebetween

interventionismandeconomicrationalities—aswillbecomeclearasIreviewthestate’sfiscal

policies,socialwelfarepolicies(inclusiveofpublicemployment),creditpolicies,andindustrial

policies—,finally,thoughthisrentierismmayhavecontributedtostability,itdidsoatthe

expenseoflong-termdevelopment.273

Regardingtherevenueaspectofstatefiscalpolicy,thepost-1973Jordanianstateretained

andscaledupapre-existingdependenceonexternalassistance,importduties,indirecttaxes,

domesticandinternationalborrowing,andnon-taxformsofextraction(suchasthefeesleviedon

postandtelephoneservices).Theshareoftotaldomesticrevenuesattributedtoimportduties

272 Thoughthisfiscalsociologyimpliedandrealizedthroughsuchanarrangementwasnotparticularlyinequitable,

itwasatonceunsustainableandpoliticallydestructive.273 Iwillalsoconnecttheseinterventionstotheregime’sevolvingauthoritariansurvivalstrategy.Asthisstrategy

remainsstructurallyunchangedtoday,thissubsectionwillgivethereaderapreviewofmuchofthematerialthatwillbecoveredinsectiontwoofthisdissertation.

142

duringthisperiodfluctuatedbetweenahighof44.98%in1977toalowof18.37%in1989,while

theaforementionednon-taxrevenuestreamsconsistentlycontributedbetween25-40%formost

theyearsunderquestion.

SourcesofDomesticRevenues,1974-1989(%)274

Income tax

Others Total Direct Tax

Import Duties

Taxes on consumption

Licenses Fees Total Indirect Taxes

Post, Telephone

Interests and Profits

Others Total non-tax revenues

Total

1974 8.19 4.96 13.16 25.63 13.67 7.57 6.27 53.13 2.38 12.88 18.45 33.71 100 1975 11.22 4.51 15.73 25.28 12.89 7.15 9.27 54.59 2.7 13.17 13.81 29.68 100 1976 8.68 6.86 15.54 37.17 8.46 9.86 11.77 67.25 2.11 9.39 5.71 17.21 100 1977 9.28 6.47 15.74 44.98 6.96 9.21 5.9 67.04 2.46 8.71 6.04 17.22 100 1978 11.71 6.1 17.81 38.71 4.42 8.39 8.46 59.97 4.79 9.06 8.36 22.21 100 1979 11.91 7.15 19.06 38.85 5.62 8.3 9.08 61.35 4.72 8.35 6.52 19.59 100 1980 11.84 8.05 19.89 34.5 5.84 8.36 8.64 57.35 5.3 9.36 8.11 22.75 100 1981 12.93 6.57 19.5 30.42 5.46 8.14 11.82 55.85 4.1 14.56 6 24.65 100 1982 12.06 6.29 18.35 30.3 6.66 6.85 10.49 54.3 5.72 14.68 6.95 27.35 100 1983 11.49 5.97 17.46 30.1 8.81 6.43 10.5 55.84 5.84 14.85 6.02 26.7 100 1984 11.73 6.81 18.55 28.44 8.96 6.92 10.73 55.05 8.03 8.76 9.61 26.4 100 1985 12.34 6.44 18.79 26.76 10.39 6.42 9.62 53.19 8.68 9.97 9.37 28.02 100 1986 9.32 5.14 14.46 21.77 10.03 5.83 8.02 45.66 8.86 7.72 23.3 39.88 100 1987 8.53 5.69 14.22 20.42 10.97 6.2 9.42 47.01 7.86 6.96 23.94 38.77 100 1988 7.94 6.23 14.17 21.51 11.21 6.61 9.29 48.63 9.29 5.06 22.85 37.2 100 1989 9.09 7.29 16.37 18.37 13.7 5.71 11.02 48.81 11.09 7.9 15.83 34.82 100

Specifictothestate’sdomesticborrowing,thiswasoperationalizedthroughtheissuance

oftreasurybillsandtreasurybondsaswellasthroughthereceiptofdirectloansfromlocal

commercialbanks.Excludingthedirectloansprofferedbycommercialbanks,domesticand

internationalborrowingcontributed15-25%ofgovernmentfinancingacrossthetenureofthis

SSA.275AshadbeenthecasesincetheACCfirstwontheearofEmirAbdullahinthe1920s,direct

274 DataprovidedbyMasri(2005),Index14,Table5.275 AsIwillshow,excessiveinternationalborrowinginthemid-1980swouldultimatelytriggeradebtcrisisin

Jordanthatsubsequentlysenttheeconomyintoatailspinfromwhichithasneverproperlyrecovered.

143

taxesonincomeandbusinessweretoremainmarginaltothestate’srevenuestrategyacrossthe

yearsunderexaminationremained.276

DataprovidedbyMasri(2005),Index14,Table4

Withtheexceptionoftheeffectsgeneratedbydomesticborrowing—borrowingthat

functionedsotoredirectwealthupwardandintothepocketsoffinancialcapitalinparticular—,

thefiscalsociologyendowedbythisrevenuestrategywasverymuchinkeepingwithprecedent.

Themarginalityoftheincometaxmadecertainthatsocialinequityandeconomicinefficiency

enduredattheontologicalcoreofthestateproject.Problematicasthisalreadywas,theabsence

276 Between1967and1973,forinstance,incometaxesreceiptsaveragedouttoapproximately25%ofthereceipts

providedbyimportduties.Acrossthefollowingfifteenyears,moreover,directtaxes’aggregateshareofannualstaterevenuesaveragedoutatonly16.8%(Masri,330).

144

ofanincometaxbasealsorenderedthestate’srevenuestrategyendemicallyvolatileand

externallydependent—attributesthateventuallyopenedthedoorforfurthersocialinequity

courtesyoftheIMF’sstructuralreforms.277Asforthespendingsideoftheledger,despitethe

hugeincreaseinstaterevenuesthatwereultimatelyrealizedthroughafavorableexternal

environment,stateexpendituresinthepost-1973periodwereneverthelessofsuchamagnitude

astoimplyconsistentannualdeficitsandagrowingnationaldebt.278Publicspendinggrewata

shockingannualrateof15.6%peryearbetween1973and1986—agrowthratethatyieldeda

nominaljumpfrom146.6millionJDingovernmentspendingin1974to1.1billionJDin1989.279

277 Onceexternalinflowswerenolongersufficientinfightingofffiscalcrisis,thisabsenceofincomeandcorporation

tax-basedreceiptsforcedthestatetolookelsewhere—therebyallowingfortherealizationofafarmoreregressivetaxfuture.Asthisactuallyplayedout,thelossofexternallygeneratedrevenueswouldprecipitatethestate’sinevitableturntoeasytoadminister,IFI-backedGeneralSalesandValue-Addedtaxesasitattemptedtofillthegaps.Duetothefactthatthegeneralavailabilityofthesepolicyleverscannotbeunderstoodapartfromthefailuretoinstitutionalizedirecttaxationinthisperiod—andduetothefactthattheseconsumptiontaxesinvesteddecidelypunitive,sociallydislocating,andclasstargetingpropertiesintothefiscalsociologyofAbdullah’sHashemiteregime—,then,oneneedaccountforthedistalconsequencesofthestate’srevenuestrategybetween1973-1986asmuchastheimmediateonesifoneistohaveacomprehensiveunderstandingofthisaspectoftheSSA.

278 EvenpriortothereceiptofGulf-generatedwindfalls,governmentexpendituresgrew19.8%peryearacrossthe

1967-1973period(Masri,201). Ontheconsistentdeficitsrunbetween1973and1989,seeKnowles(2001),p.103,114.279 DatagatheredfromMasri(2005),Index13,Table4.

145

Disaggregatinghowthisspendingwasallocated,approximately70%ofthetotalwasdevotedto

annualcurrentexpenditures.Primarilyfinancingaqualitativeexpansionofthepublicsector

laborforce,suchexpenditurespoweredatriplingofthecivilservicebetween1970and1984.280

Incombinationwithsignificantexpansionsinmilitaryemployment281,thepublicsector’sshareof

aggregateemploymentwouldtherebyreachfullparitywiththeprivatesectorasofthemid-

1980s.282

Byprovidingsteadywages(andconsistentwageincreases),substantialbenefits,and

healthservices,publicsectoremploymentsecuredwhatamountedtomiddleclasslifestylesof

hundredsofthousands(ethnicallyTransjordanianpeople283).Governmentjobholderswereeven

shieldedfromtheinflationarypressuresrunningrampantatthetime.284Mostrelevantinthese

280 Innominalterms,theranksofthecivilservicegrewfrom27,000in1970to74,000in1984(Piro,66).281 Defenseexpendituresabsorbedbetween28-40%oftheofficialannualbudget(Masri,205,334),though

Kanovsky,drawingonUSArmsControlDisarmamentAgencydata,hasestimatedthatmilitaryspendingwaslikelythreetofourtimesgreaterthanwhatwasreportedinthosebudgets(Jordan’sEconomyfromProsperitytoCrisis).Whilesomeofthisspendingwasdirectedtowardsweaponsprocurement,muchofitwenttowardshiring,wagesandthemilitary’spensionandhealthcaresystems.

282 Functioningalmostexclusivelyasamechanismforpatronagedistribution—onethatcouldwidenthesocialbase

oftheregimethroughfurtherembeddingTransjordanianfamiliesandcommunitiesinthelargesseofthestate—,however,itshouldalsobenotedthatthishiringcampaignwasnon-meritocraticinnature.Withthevastmajorityofthestate’snewchargesbeingofthelow-skillvariety,thesocialbenefitsderivedfrompublichiringwerepartiallyoffsetbyboththeeconomicinefficienciestherebyproducedandthenegativeeffectsthattheabandonmentofmeritocracyexertedonstatecapacity.

Aswillbediscussedinthesocialcontrolsection,duetotheGulf ’sopeningofitslabormarkettoJordanasof

1974—amovethatprecipitatedamassmigrationofprimarilyeducatedPalestinians–thesocialimpactofthisnon-meritocratichiringpolicy,onedesignedlyfavoringethnicTransjordanians,wasnotquiteaspronouncedasitotherwisewouldhavebeen.

283 Withpreferentialadmissionstandardsandquotasputinplaceatpublicuniversitiessotoinsurethatthechildren

ofHussein’sethnicallyTransjordanianalliesgotalegupinhighereducationaswell(Satloff1986,AbuOdeh,2000).

284 Thisinflationwaslargelydrivenbytheinflowsofaidandremittances(aswellasbytheallocative,consumption-

orientedpracticesofthePalace).

146

regardswastheestablishmentoftheCivilConsumerCorporation(CCC)in1975.Operatingunder

theMinistryofSupply,theCCCprovidedcivilservantsandmilitarypersonnelwith“durableand

non-durableconsumergoodsatcostprice,dutyfreeinrespectofimporteditems.”285Laterthat

decade,specialsupermarketswerealsointroducedwhilerentcontrolpoliciesandthe

subsidizationofhousingwereimplementedtocontroltherealestatemarket’sanimalspirits.

Bytheearly1980s,thePalacemovedbeyondthispublicsectorwelfarismsotoestablisha

moreuniversalsystemofpricecontrolsandsubsidies.Operatingoutoftheaforementioned

MinistryofSupplyaswell,thissubsidyregimewasoneofthefeweconomicinterventionsofthe

timethatmanagedtodelivermass-orientedandelite-orientedbenefitsatoneandthesametime.

Regardingitsmass-orientednature,thestate’ssubsidizationofwheat,flour,sugar,rice,meat,

poultry,oliveoil,andmilkhelpedsecureabasiclevelofwelfareandhouseholdconsumption,

regardlessofemploymentstatus.286Asforitselitebenefits,thosesubsidiesalsosecuredsteady

profitsforanewquotacoteriepredominantlycomprisedofethnicallyTransjordaninanmerchant

capitalists.Specifically—andfollowingmuchthesamelogicastheMiddleEastSupplyCentre—,

thesubsidyprogramprivilegedpoliticallyconnectedmerchantsthroughawardingsaid

individualswithexclusiveimportlicensesforthoseproductsincludedundertheMinistryof

Supply’sconsumersubsidizationprogram.287Therebyaffordedaguaranteedbuyeranddefacto

285 Knowles(2001,p.110286 Ibid287 PetersandMoore(2009),p.273

147

monopolycontrolofsubstantialwholesalemarkets,subsidiesfunctionedsotofunnelhealthy

profitsintothesemerchants’pocketsacrossthe1980sandbeyond.

Forthe30%oftotalpublicexpendituresthatweredevotedtocapitalinvestment,whilea

greatdealofthisbudgetwasallocatedfordebtrepayments,overhalfofitwasdevotedtoland

purchasesandtheconstructionofgovernmentbuildings.288Thoughtheyieldofthisinvestment

providedsomethinginthewayofpublicgoods,suchexpendituresalsoprovidedaprivateboon

forthosedevelopersandconstructioncompaniesfortunateenoughtoprocurethecontractsthat

weretenderedtherein,therebyevincingthesamemass-elitedualismashadthegovernment’s

foodsubsidizationefforts.289

Asmentionedattheoutsetofthissection,thestatealsointervenedintheeconomyviaa

constellationofcreditinstitutions.Thisseriesofnominallyautonomous,specializedlendingand

investmentfacilities—themostprominentofwhichwerethePensionFund(whichwouldbe

renamedtheJordanInvestmentCorporation),theIndustrialDevelopmentBank,theSocial

SecurityCompany,andtheHousingBank—,wastypicallyusedbythePalacesotofinancea

numberofpoliticallyimportantthougheconomicallydubiousenterprisesanddevelopment

projects.ThisoftenmeantbridgingthefinancialgapsneededtokeepanumberofthePalace’s

misguidedindustrialventuresturningoverinspiteoftheirgrowinglosses.Criticalastheymay

thereforehavebeeninstavingoffthecollapseofcommodityextraction(aswellasthejobsthat

sectorcreated),thepoliticizedinvestmentstrategiesfollowedbythesecreditfacilitieseventually

288 Masri,p.335289 Unsurprisingly,theprincipalbeneficiariesoftheseprocurementprocessesweremanyofthesameindividuals

thathadpreviouslybenefitedfromthestate’sindustrialpoliciesand/orissuanceofimportlicenses.

148

engenderedenormousanddiversifiedportfoliosloadedwithtoxicassets.Offeringsome

indicationofhowthescopeofthiscreditbackstopgrewovertime,Knowleshasshownthatthe

aggregateassetsofthefourinstitutionsmentionedabovequadrupledbetween1973and1983.In

nominalterms,by1989,theirtotalloanportfolioreached542.7JDmillion.290

Whatismore,theseautonomouscreditinstitutionsonlyeverconstitutedasinglepartof

thestate’sinvestmentoperations,asmoredirectformsofinvestmentandownershipwerealso

practicedinthisperiod.Takenincombination,theaggregateresultsofthisaspectofstate

interventionismareratherstaggering.Asof1989,itwasestimatedthatthestate(loosely

defined)held58%equityintheminingsector291,23.2%equityinthemanufacturingsector,and

20.8%equityintheservicessector.Moregenerallyspeaking,AnaniandKhalafcalculatedthatthe

stateheld32.2%oftheaggregatecapitalsubscribedacrossthecountry’sthirty-onelargest

firms.292

Beforeclosingonstateinterventionisminthepost-1973period,ahandfulofspecialpolicy

initiativesmeanttorevitalizetheelitefractionofthecapitalistclass—agroupofactorswholly

disorientedbythecrisesof1967and1970-1971—arealsoworthmakingnoteof.Inthedomain

oftradepolicy,preferentialimportlicensingarrangementsallowedtheseactorstoretainthe

monopolisticandoligopolisticmarketpositionstheyhadearlieracquiredthroughpreviousstate

290 Knowles(2001),p.116291 ThestateheldmajoritysharesinallthebigfiveindustrialassetsapartfromtheJordanianPetroleumRefinery

Corporation,whereit’sequitystakewas24%.292 JawadAnaniandR.Khalaf,“PrivatisationinJordan”,inEl-Nagger,S.,(ed.)AdjustmentPoliciesandDevelopment

StrategiesintheArabWorld,pp.210-233.

149

interventionsinthewholesaleandretailsectors.293Throughitsrefusaltodevaluethecurrency—

arefusalthatcamedespitetheobviousutilitythatdevaluationwouldhaveinreducingthetrade

deficit294—,moreover,thePalacealsoensuredthatthedemandforimportswouldnotbestifled

intheleast.Havingprivilegedimportdutieswithinthestate’srevenuestrategy,thestatewould,

infact,directlyalignitsinstitutionalinterestwiththeparticularistinterestsofthemerchantas

well.

Withpolicytherebystructuredacrossanumberoffrontsinsuchamannerastoinsure

thatimportconsumptionwounduppoweringahugeproportionofGDPgrowthinthisperiod,

policyalsoprovedverygoodforthoseactorspositionedsotocontrolJordan’simportmarkets.In

addition,thesesameeliteactorsbenefitedthroughtheinterventionsoftheJordan-Iraq

CommitteeforEconomicCoordination(JICEC),whichwasdesignatedresponsibilityforawarding

speciallicensesforexportingtotheIraqimarket.Thoughthisfraud-ladenprocessthatwould

latercomeundoneinspectacularfashion,initsearlydays,theJICECdeliveredwonderfulprofits

293 Indiscussingimportsandtradepolicy,IwouldberemisswereInottoacknowledgehowthesedomainsalso

cametobenefitanumberofgovernmentministries(andtheirrespectiveworkforces).Specifically,by(purposefullyorunpurposefully)establishingasystemofoverlappingauthorities—asystemreferredtoasal-izdiwajiyya—bureaucraticredundanciesallowedtheMinistriesofPlanning,Finance,andIndustryandTradetoeachclaimresponsibilityforsimilarlywideandintersectingdomainsofoperations.Insodoing—andinalsobringeachMinistryintotherent-ladenorbitofimportpolicy—al-izdiwajiyyasawtoitthateachMinistrywasabletolegitimategrowingbudgetrequests,requeststhatinturnallowedeachinstitutiontogrowtheirowninternalclientelesofmiddlemanagers(Piro,84).Intotal,tenofthetwenty-twoministriesoperatingasof1984managedtoimplicatethemselvesinthemanagementoftheeconomytoonedegreeoranother.Thoughtheinstitutionalizationofal-izdiwajiyyaundeniablyweakenedtheinstitutionalcapacityandrationalityofthebureaucracy,itsimultaneouslyfunctionedsotomakeeachministryorganizationallyrobustthroughprovidingthemhealthybudgetoutlaysandaccesstoimport-basedrentextraction.

294 Thedecisionnottodevaluewasalsomadeoutofthefearthatitwoulddriveawayremittances(Piro,71).Though

desperatelyneededinordertoalleviatethetradedeficit(andinordertohelpdomesticindustrialcapital),thenearsightednessofthePalace’seconomicsmeantitwasneverconsideredpriortotheIMF’sarrivalin1988-1989.

150

foraprivilegedfewfirmsinthecement,pharmaceutical,andbankingindustries.295Finally,tothe

extentthatonlylicensedcommercialbankswereallowedtoparticipateinthedomesticbond

market—andtotheextentthatthesecommercialbanksweredisproportionatelyownedby

membersoftheoldquotacoterie—,itcouldalsobearguedthatthestate’sdebtissuancesalso

functioned,atleastinpart,asanelite-orientedinterventionintheeconomy.296

SocialControl

Asdiscussedinthepreviouschapter,theregime’scrackdownonpoliticalassociationin

theaftermathofBlackSeptemberalsoextendedintothenon-partisandomainoftradeandlabor

unions.Usingavarietyofjuridicalmeans,theGeneralIntelligenceDirectory(workingin

partnershipwiththeMinistryofLabor)laidsiegetothemajorinstitutionsofworkingclasslife,

culminatinginthedefactoconquestoftheGeneralFederationofJordanianTradeUnions

(GFJTU).297Consolidatingadisjuncturebetweenlabororganizationsandthesocialforcesthey

295 FormoreonthisseePiro(1998),p.67296 Itwouldbedisingenuous,ofcourse,tosuggestthatthisarrangementworkedpurelytothebenefitofthe

commercialbanks.Thebankswere,afterall,verymuchatthebeckandcallofthePalace.Forinstance,between1984and1986,theCentralBankwoulddemandthatcommercialbanksinvestbetween4-9%oftheirdinardenominateddepositsintreasurybillsanddevelopmentbonds.In1986,theCentralBankwouldalsorequirethatcommercialbanksinvestatleast15%oftheircapitalintheshareholdingcompaniestradedontheAmmanStockExchange(thatfigurewoulddropto9%asof1987).Andyet,asexploitativeandeconomicallydestructiveasthesepolicieswereinthelongterm,theinterestratesattachedtothegovernment’sbondsmadeitworththetroubleforJordan’scommercialbanks,atleastforatime.Priortothedebt,currency,andbankingcrisesof1988-1989,moreover,returnsoninvestmentintostateownedenterpriseswerealsopoliticallyguaranteed.

See:Masri(2005),p.343297 Havingbothdivestedthisbodyofitsinternaldemocracyandhavingco-optedthoseindividualsatthetopofthe

GFJTU’sleadershipstructure,Jordan’sFedayeen-aligned,politicallyantagonisticunionswerelargelybroughttoheel.

151

weremeanttorepresent,thissystematicdiscipliningofthetradeunionmovementanchoredthe

entiretyofthepost-1973socialcontrolstrategyandistherebydeservesprideofplaceinany

analysisofthisperiod.

Complementingthesecoerciveformsofintervention—andperhapsevenmoreeffectivein

theestablishmentofsocialcontrol—however,wasthemigrationsystemputinplacebytheArab

statesfollowingtheoilboomof1973.ForJordan,theoutflowingendofthissystemsawhundreds

ofthousandsofJordanianworkerssecurelivelihoodsinthecash-flushedGulf.298Togivesome

senseofthemagnitudeoftheseoutflows,atanygiventimebetween1975and1985,onewould

havefoundroughly40%oftheJordanianlaborforceworkingand(permanently/semi-

permanently)residingintheGulf.299

Foraneconomyandsocietyshellshockedbythecrisesof1967and1970-1971,theGulf’s

acceptanceofJordan’shighandlow-skillsurpluslaborprovedanessentialpreconditionfor

subsequenteffortstoreconstituteanewmodalityofdomesticsocialpeace.Helpingclosethe

structuraldisarticulationoflabormarketsupplyfromlabormarketdemand,theyfirstand

foremostalleviatedathendeepeningemploymentcrisis.Morethanthat,theGulflabormarket

298 YannLeTroquerandRozennHommeryal-Outdat,“FromKuwaittoJordan:ThePalestinians’ThirdExodus”,

JournalofPalestineStudies(28:3),p.38. WhiletheGulfhadlongprovidedacriticalreleasevalvefornakba-dislocatedPalestinianlaborersinparticular—

evenbefore1970,Kuwaitgavehosttoover140,000Palestinians,manyofwhomhadarrivedduetorelaxedmigrationcodesoftheearly1950sandsubsequentlycometofilltheKuwaitibureaucracyandconstructionsector—,thepost-1973yearswitnessedaqualitativejumpinGulf-boundemigration.

299 Innominalterms,asof1986,thisdistributiontranslatedto592,000Jordaniansworkingathomeand325,000

Jordanians(oftenaccompaniedbytheirfamilies)laboringacrossKuwait,SaudiArabia,theUnitedArabEmirates,andQatar.

See:Oroubal-Abed,“Thediscourseofguesthood:ForcedMigrantsinJordan”,inA.HFabiosandR.Isotalo(eds.)ManagingMuslimMobilities.PalgraveMacmillan(2014).

152

alsoactedasareleasevalveforthePalestinianquestionbyprovidinglucrativework

opportunitiesfortheethnicPalestinians,theGulf’simmigrationpoliciestookmuchofthesting

outoftheJordanianstate’songoingdePalestinianizationcampaigns.300

Complementingthesocialcontrol-relatedeffectsderivedfromGulf-bounddepartures

werethoseborneofthelowskill(primarilyEgyptian)arrivalsthatflowedintoJordanduring

thesesameyears.Forsomebackground,priorto1984,outsideArabshadbeenallowedtolegally

resideandworkinJordanwithoutneedforalaborpermit.301Whilealackofeconomic

opportunitymeantthatrelativelyfewforeignworkersavailedthemselvesofthispan-Arabistrelic

duringthe1950sand1960s,onceexternalaidandremittancesbeganrushingintopost-1973

Jordan,sotoodidlowskill(primarilyEgyptian)laborseekingtheirownsmallpieceof

300 Ititworthnotingtheextenttowhichtheregime’ssocialcontrolstrategyhadadistinctlyethniccomponentand

howthesubjectingofPalestinianpopulationstoaparticularregimeofsurveillance,discrimination,andprecarityalsocontributedtogeneralizedquietude.Havingneverpromulgateddomesticlegislationconcerningrefugeesandforcedmigrants—adecisionpartlyinformedbythePalace’sunderstandablereluctancetonormalizethePalestinianexodus—andhavingneversignedthe1951UNConventionRelatingtotheStatusofRefugees,thePalacewasabletorespondtoBlackSeptemberbyassigningitsMinistryofInterioranditsdomesticintelligenceforcesprimarylegalresponsibilityfordealingwithcamp-basedPalestinianpopulations(Al-Abed,83).Inaddition,inalsotieringthelegalstatusesofdifferentfractionsofPalestinianrefugees—GazanmigrantsintoJordanhaveneverbeengrantedcitizenship—theregimehasalsobeenabletoconstructandexploitjuridicalambiguitysotorendercitizenshipandthelegalexistencethatimpliesinherentlyprecariousforlargesegmentsofthesecommunities.InadditiontothedePalestinianizationofthepublicsector(see:AbuOdeh,190),from1976onwards,aquotasystemwouldalsobeestablishedatJordanianuniversitiessotoaffordpreferentialadmissionstoethnicTransjordanians(Massad,258).

OntheGulf-boundoutflows,IshouldalsoaddthatwhiletheirPalestinianandprivatesectorcompositionis

typicallyemphasized,itisimportanttonotethattheopeningofGulflabormarketsalsoimpliedthetransferoflargenumbersof(ethnicallyTransjordanian)publicsectorworkers.ComprisingtheJordanianbureaucracy’stravelingactweretypicallyeducators,healthcareworkers,andsecondedmilitaryofficers.Whilenothavingquitethesamesocialcontrolimpactastheprivatesectormovement’sdescribedabove,byhelpingmitigatesomeofthefiscalstrainandbureaucraticredundanciesthathadbeengeneratedthroughthestate’suncheckedexpansioninthe1970s,oneshouldnotdiscounthowtheseregionalreassignmentstoocontributedtothestabilizationofthewiderHashemitepoliticaleconomy.

301 GeraldineChatelard,“Jordan:ARefugeeHaven”.MigrationPolicyInstituteOnlineJournal(2010),p.7

153

petrodollarrecycling.Regardingnumbers,bythemiddleofthe1980s,itwasestimatedthat

roughly450,000EgyptianswereactiveintheJordanianlabormarket,that153,519ofthesehad

beenregisteredthroughtheproperlegalchannels,andthattheEgyptianproportionofthe

aggregateforeignlaborstockwasroughly80%.302Importantly,theseinflowsoflow-skillforeign

laborwereencouraged,activelyrecruited,andlobbiedforbyJordaniancapital,particularlythose

actorsandenterprisesholdingstakesintheagricultural,construction,andrealestatesectors.As

theseforeignworkersrepresentedasignificantreductioninthecostoflaborinputs—andas

profitmarginsandbusinessmodelsintheaforementionedsectorscametobesolelypremised

uponafirm’scapacitytoaccesstosuchinputs—,thisclassfraction’sinterestinthenon-citizen’s

righttoworkinJordanwas,ofcourse,deeplycynicalandnon-altruistic.

Whenitcametosocialcontrol,theeffectsofthemass-employmentofcheapEgyptian

laborwouldbethree-foldwhenitcametosocialcontrolinthepost-1973period.Firstandas

hintedatintheparagraphabove,cheapEgyptianwages(andthedepressiveeffectstheir

presencehadonthewiderwagestructure)stabilizedtheprofitsofthecapitalelite.303Tying

profitsandaccumulationtoaccesstoforeignlaborwouldofcourseprovedisastrous(andpath

dependent)inthelong-term—whetherdevelopmentallyorsociallyspeaking.Totheextentthatit

buoyedthebusinessclassesintheshort-termandwiththemthelargereconomicsystem,

302 Ibid303 AsthatlattergroupofactorswasnowincreasinglyenmeshedintheeconomicsofJordan’surbanizingbuilt

environment—whetherthroughcontractingwork,realestatespeculation,orfinance—,accesstocheapforeignlaborwastobecomefundamentaltotheirprofitmargins.

154

however,itunambiguouslybenefitedthesocialcontrolstrategyofthisperiodaswell.304Second,

theinjectionofEgyptianlaboralsoallowedtheregimetointegrateportionsoftheethnically

Transjordanianpeasantryintotheexpandingstatebureaucracywithoutdeprivingthefarming

industryofthelaborinputsneededforitsoperations.Byindirectlyfacilitatingtheupward

mobilityandsocialreproductionforJordan’slowerandmiddleclasses,305then,thiseffectof

Egyptianlabor—whichconstituted87%thelaborforceintheJordanValleyasof1986—too

contributedtosocialcontrolacrossthedecadesunderquestion.306Third,theEgyptianizationof

thelaborforcealsocontributedtocapitalistsocialcontrolbycomplicatingthemobilizationof

workersolidarity.Asforeignlaborerswerebothculturallyapartandeternallyprecariousdueto

theirexceptionallegalstatus—non-Jordanianworkerswerebarredfromforming,joining,or

participatinginunionactivitiesandatalltimessubjecttodiscretionarydeportation—,theywere

alsoactorsforwhomantagonisticlaboractionwouldintrinsicallyholdlittleappeal.Representing

roughly50%ofthetotallaborforceastheydid,theirnecessaryquietismthereforemeantthat

nativeworkers’movementsheldpreciouslittleleverageinanyconflictwithcapitalorthestate.

304 Theseworkersrepresentedadefactosubsidyinthesensethattheywerewillingtoacceptwagesbelowthe

marketrateinJordanandinthesensethattheywereexcludedfromtheprotectionsandprivilegesprovidedbythelaw.

305 OneshouldalsonotehowcentraltheKafalasystem—bywhichIrefertoamigratoryandlegalregimecentered

ondomesticworkers—wastomaintainingahighqualityoflifeformuchoftheJordanianmiddleclass.Asthesewomenwerefunctionallydevoidofrights,theirlowwagesandlonghoursfunctionallysubsidizedthesocialreproductionofthousandsofmiddleclassJordanianfamilies.

306 Chatelard(2010),p.6 Certainly,thestate’sabsorptionoflowskilledTransjordanianworkerswaseverybitasdevelopmentally

problematicastheimportationofcheapEgyptianlaborwas.Nevertheless,itwasextremelyeffectiveasamatterofsocialpolicy.

155

Incombinationwiththerepressionandsurveillanceofdomesticorganizedlaborandthe

lowemploymentratethatwassecuredthroughexportationoflargesegmentsofthelaborforce

totheGulf,onecansee,then,howtheinflowsideofJordan’smigrationpolicyfunctionedsoto

preemptunrestandsotoinflatetheprofitsofdomesticcapital.

ExternalArticulation

Jordan’smodalityofinteractingwithregionalandinternationaleconomicsystems

between1973and1986operatedaccordingtothesamelogicashadpreviousversions.Tobegin,

thestateandmerchant’selitecontinuedrelianceupontheimportmarketensuredthatJordan’s

developmentallydestructiveaddictiontoforeignconsumergoodspersistedonunabated.With

littleheadwaymadeinupgradingthesophisticationofthecountry’smanufacturingoperations307

(andwiththecountry’sexportbaskettherebystilloverwhelminglyconcentratedinhighlyvolatile

commoditymarkets),thisaddictionengenderedeverwideningcurrentaccountdeficits

throughouttheperiodunderquestion.Thatsameconcentration,moreover,alsoleftJordan’s

economystructurallyvulnerabletoshiftsinitsexogenousenvironment.Whentakenin

combinationwiththefactthatthestate’sbudgetarystrategywasitselfalsoalmostentirely

dependentuponequallyvolatile(andexternal)sourcesofincome,thisvulnerabilityleftthe

accumulationprocesswithoutanykindoffirewalltoprotectitformexternally-introduced

307 ThislackofsuccesswaspartiallyafunctionofaderivativeformofDutchdisease.Thedeepeningintegrationof

Jordan’seconomywiththelargerpetroeconomiesoftheGulfledtocurrencyovervaluation.Inconjunctionwiththeeffectsofthestate’semboldeningcronyism,thisovervaluationwouldcontributetothedecliningcompetitivenessofJordan’smanufacturedgoods.

156

shocks.Worsethanthat,theeconomy’sreavowalofitsdependenceonpotashandphosphate

exports—occurringduringthesameyearsthatEastAsianeconomieswereusingthetransition

intohigh-technologyproductiontopowertheireconomicconvergencevis-a-visthewest—also

prefiguredthecountry’smorestructural,long-termdriftintolowcomplexity,low-valueadd

stagnation.

StructureofJordanianImports,1974-1989308

*Unit:Thousands(JD)

Total Consumer Goods

Crude Materials and Other Goods

Capital Goods Miscellaneous Goods

Total Imports

1974 69627 29998 40913 15969 156507 1975 90513 57222 82877 3401 234013 1976 133335 90003 114628 1573 339539 1977 147185 121187 184099 1946 454417 1978 175669 117252 161232 4673 458826 1979 215211 179462 193575 1275 589523 1980 240154 227087 246743 1993 715977 1981 3252132 305518 414962 1811 1047504 1982 368303 380280 391396 2514 1142493 1983 365058 377787 310552 49913 1103310 1984 417124 453746 170533 29937 1071340 1985 384762 464695 201331 23660 1074448 1986 358230 309541 141483 40945 850199 1987 362011 371011 162813 19710 915545 1988 371616 393744 219451 37658 1022469 1989 414360 532793 262066 19791 1230010

308 DataprovidedbyMasri(2005),Index13,Table11

157

StructureofJordanianExports,1974-1989309

*Unit:Thousands(JD)

Total Consumer Goods

Crude Materials and Other Goods

Capital Goods Miscellaneous Goods

Total Exports

1974 13865 24931 634 7 39437 1975 15999 23469 603 4 40075 1976 25407 23277 862 4 49552 1977 32167 26955 1128 3 60253 1978 32630 30670 828 1 64129 1979 41994 39444 1111 7 82556 1980 54233 64216 1658 0 120107 1981 76717 86719 5508 82 169026 1982 88152 92298 5100 31 185581 1983 94244 62437 3404 0 160085 1984 108758 148683 3614 0 261055 1985 99012 153260 3074 0 255346 1986 78075 145584 1956 0 225615 1987 84102 160817 3854 0 248773 1988 79885 239262 5631 10 324788 1989 132325 388185 13586 10 534106

309 DataprovidedbyMasri(2005),Index13,Table11

158

DataprovidedbyCentralBankofJordan

Institutionalizingaderivative(oil-dependent)rentieristeconomywithanoverdependence

onimportconsumption,theexternalarticulationoftheJordaniansocialstructureof

accumulationinthisperiodprovedtemporarilystabilizing(inthatitdeliveredprofitsto

merchantcapital+

159

indirect,tariff-basedtaxreceiptsforthestate)aswellasfundamentallydestructiveinthe

mediumtolong-term.

FormsofMarketCompetition:EnduringClassFractures,EnduringEliteHegemony

IfthesocialcontrolstrategyofcapitalanditsHashemitemindersshiftedconsiderably

after1973,thesamecannotbesaidofthemodalityofcapital-capitalrelations—andtheformof

marketcompetitionsuchrelationsendow.Asprivatesectorcompetitionwasmostlylimitedto

contestsforpoliticalfavor,marketscontinuedtolackwhateverdynamicenergiestheycan,on

occasion,givehostto.Asthistranslatedtomarketstructures,oligopolsiticormonopolistic

formationsprevailedacrossmostsectorsoftheeconomythroughouttheperiodunder

question.310

Notwithstandingthesecontinuities,thecapitalistclassitselfdidundergosomenon-

insignificantchangesintheseyears.Tobegin,whilemuchoftheoldquotacoterieeliteeventually

managedtoretainandgrowtheirwealthfollowinganumberofyearsofpost-1970paralysis,the

hegemonyoftheirclassfractionwasnolongerbeastotalasitoncewas.Henceforth,theywere

joinedattheheightsoftheeconomybytwodiscretegroupsofnouveauxriches.Thefirsthad

beenmintedthrougheithersuccessesintheGulforopportunisticplaysinAmman’sfeveredreal

estatespeculation.Thesecondwascomprisedofanumberofactorswhomanagedtoleverage

310 SeeMasri(2005),Appendix16,Tables1-37forafullbreakdownofmarketstructuresduringthisperiod.

160

theirpowerinthebureaucracyintobusinessacquisitions.Prominentamongstthislattergroup

wereahandfulofformersenioremployeesoftheCentralBankofJordan.311

Asregardsthefateofthequotacoterieitself,inadditiontoretainingtheirpositionsof

dominancewithinthecommercialsector,manywithinthisfractionpivotedintoconstruction,

governmentcontracting,realestate,andGulf-entangledinvestmentduringthe1970sand

1980s.312Thetableonthefollowingpage—demonstratinganeconomywhollydominatedby

retailtrade,finance,governmentservices,andtransportation(itselfanappendageoftheimport

game)—evincethesectoralimbalancethatresulted.313Otherswithinthisclassfractionused

thesedecadestoshoreuptheirdominanceofJordan’srapidlyexpandingbankingandfinance

sectors.314ThemostobviousinstanceshereinweretheShumanandMu’asharfamilies.315Asthe

financializationoftheglobaleconomyintroducedincreasingreturns(ifalsovolatility)tothe

311 SeeMasri,p.410ontheCentralBankEmployees.Also,seeMasri(2005),Appendix11forthedistributionof

powerandcapitalwithinthiswiderclassfraction.312 Withouteverabandoningtheirimportandretailempires,theNuqul,Masri,andAliBdeirfamiliesmanagedthis

transitionintonewgrowthareasespeciallysuccessfully(Masri,408).313 Notethatgovernmentaccountingmetricscodeagreatdealofcommercialbusinessunderthelabelof

“transportation”(alabelthatincludesbusinessesinvolvedinthemovementofgoods).314 ThoughbrieflychallengedbyahandfulofnewGulf-madecompetitors—Ahmadal-Galabi’sPetraBankand

HassanAbdulAziz’sJordan-GulfBankinparticular—thishegemonywouldeventuallybereaffirmedwheneachofthesechallengerswentbustduringthebankingofcrisisofthemid-late1980s.

315 TheShumanfamilyrepurchasedconsiderablesharesofArabBankintheseyears,whiletheMuasherfamily

repurchasedmuchoftheequityintheJordanNationalBank.ThoughArabBankalsoreceivedconsiderableGulf-basedinvestmentinthesesameyearsyears—withtheHaririfamiliyinparticulartakingonasignificantequityshare—,suchrepurchasesweresufficientsoastoretaintheShoman’sleadershipoverthislionofJordanianbanking.

Similarly,theoldguardal-Sakar,Tash,Abdal-Rahman,andTouqanfamiliesmanagedtoretaintheircontroloverAmman-Cairobankduringthissameperiod.

161

bankingindustryacrosstheperiodunderquestion,thequotacoterie’shegemonyoverthissector

provedextremelyprofitableforatime.316

DataProvidedbyCentralBankofJordan

316 Thoughslightlylater,itishereworthnotingthatquotacoteriefamiliesalsoacquiredmajorequitystakesinthe

ExportandFinanceBank(laterrenamedAhliBank).EFPwasfoundedin1995byShakerbinZaidandAlial-Husri,theformerofwhichwasacousinofHussein’s.TheFinanceMinisterandtheGovernoroftheCentralBanksatonitsboard,andtheNuqul,Darwazah,AbuJaber,andKawarfamiliesprovidedmuchoftheearlycapital(Schlumberger,149).

162

SectoralShareofNationalGDP,1974-1989

Unit:Percentage317

Collapse:Crisis,Stabilization,andthePreludetoAbdullah

WhileOPEC’sembargofacilitatedoneofthegreatestredistributionsofwealthinmodern

globalhistory,thegoodtimesdidnotlastforever.Bytheearly1980s,thepriceofcrudeoilon

internationalmarketswastrackingconsistentlydownward,precipitatingacommensurate

declineinthepetro-derivedrentsannuallyaccruingtothegovernmentsofSaudiArabia,Kuwait,

Libya,andIraq.318Inthisclimate,theregionalpartnersuponwhomJordanhadgrown

increasinglydependentoverthecourseofthe1970sthemselvesgrewincreasinglyconservative

317 DataprovidedbyMasri(2005),Index13,Table2318 TheIraqieconomywasalsodealingwiththestressintroducedbythecountry’sendlesswarwithIran.

163

whenitcametotheextensionofbudgetarysupport,developmentgrants,foreignlending,and

energyconcessions.

Aswasearliermentioned,inattemptingtofillthegapsleftbythereducedavailabilityof

externalassistance,Jordan’seconomicpolicymakersfirstturnedtodomesticandinternational

bondmarkets.ThiskindofdebtfinancingacceleratedunderthegovernmentofZaydal-Rifa’iin

particular.Foreign-helddebtswiftlyspikedtounsustainablelevels,growingfrom1.6$billionin

1981to8$billionasof1989.319

Ifalreadystressedbytheprospectsofasovereigndebtcrisis,thetroublesfacingthe

JordanianeconomyonlyworsenedonceIraqiimporters,underthestressofwar,provedunableto

honoranumberofcontractspreviouslyagreeduponwithJordanianenterprises.Firmsinthe

banking,pharmaceutical,andindustrialsectorswereespeciallyexposedtothelossesthereby

rendered,precipitatingawaveofnationalbankruptcies.Nordidthebadtimesendthere.Upon

theKing’sannouncementthatJordanwouldunilaterallyrescinditsclaimontheWestBank—a

decisiontriggeringcapitalflightasanxiousethnicPalestiniansgrewconcernedabouttheirlegal

standingintheHashemiteKingdom—,theeconomynextgavehosttoafullscalebankingcrisisas

well.Withthesituationmadeevenmoredesperatebyinternationalcreditors’refusaltoextend

thegovernmentnewloans,come1989,KingHusseinwaseventuallyforcedtoturntotheIMF.Far

fromplayingtheroleofsavior,however,neithertheinjectionoftheFund’semergencycapitalnor

thepolicyadvicetheyadministeredweresufficientinstemmingthebleeding.Quitetothe

319 JawadAnani,“ThepoliticalsociologyofJordan:ananalysisofthemapofgainsandpains”,inManagementand

InternationalBusinessIssuesinJordan(2001),p.176.

164

contrary,infact,theIMF’ssuccessesinconvincingtheKingoftheneedtoliberalizetheJordanian

Dinarquicklybroughtaboutrapiddevaluation,therebyintroducingacurrencycrisisontothelist

ofeconomictraumasalreadyinflictingtheeconomy.320

Finally,amidstallofthiseconomicchaos,oneofHussein’srelativelyrareforeignpolicy

miscalculationsalsoprecipitatedtheundoingofthePalace’spreviouslystable(ifexternally

dependent)socialcontrolstrategy.DuetohisdecisiontomaintainJordan’sneutralityduringthe

firstGulfWar(1991-1992),HusseinhadincurredthewrathofboththeconservativeGulf

monarchiesandtheUnitedStates.Thiswrathexpresseditselfnotonlythroughthecessationof

budgetassistance.Whatwasworse,Hussein’sneutrality—inconjunctionwithYasirArafat’sopen

supportfortheIraqiwarproject—enragedtheal-SabahofKuwaittotheextentthattheydecided

toexpelthecountry’shugeethnicallyPalestinian,legallyJordanianexpatriatelaborforce.By

consequence,200,000Jordaniannationalswereforcedtomakeaninvoluntaryreverse

pilgrimagein1990-1991,returningtoanEastBanktheyhardlyknewinhopestheymightrebuild

theirlivesinthenationoftheircitizenship.321Foraneconomyalreadysufferingunderalong

recession,thearrivalofthesenativeimmigrantspushedafullysaturatedlabormarket(andthe

socialfabricitundergirded)tothepointofbreaking.322

320 Shortlythereafter,Jordanianpolicymakersunilaterallyoptedtore-establishthecurrencypeg.321 Whilethesereturneesbroughtconsiderablesavingswiththem,muchofthisendeduponlyfurtherinflatingthe

realestatespeculationthathadbeenlargelyrunningwildsincethemid-1970s.See:AdnanAbuOdeh,Jordanians,Palestinians&theHashemiteKingdomintheMiddleEastPeaceProcess(1999),p.233.

322 Theinjectionofthese70,000jobseekers,infact,woundupdeepeningafundamentaldisjuncturebetweenlabor

supplyandlabordemand(especiallyintheprivatesector),renderingunemploymentandlaborforcenon-participationastructuralcomponentoftheeconomygoingforward.

See:LeTroquerandal-Oudat(1999),p.41

165

DataprovidedbyWorldDevelopmentIndicatorsDatabase(WorldBank)

Bottomwaseventuallyhitandtheworstofwhatwasaratherstaggeringrecessioncame

toacloseby1991.Intheaftermath,anewlowgrowth,lowaccumulationformofcapitalism—

oneshapedbyHussein’spartial,highlyunevenimplementationoftheIMF’sliberalization

agenda323—woundupconsolidating.Inbroadstrokes,thiscapitalismallowedthepalace’s

323 See:JaneHarrigan,Hamedel-Said,andChengangWang,“TheIMFandtheWorldBankinJordan:acaseofover

optimismandelusivegrowth”,ReviewofInternationalOrganizations(2006),pp.263-292,formoreonthiseraoftheIMF’sinterventionisminJordan.

Inanutshell,astheaforementionedauthorsestablish,theIMFwasneverquiteasaustere(oreffective)a

disciplinarianinJordanasistypicallyassumed,andthattheHashemiteregimewasneverquiteasdutifulastudentasissometimesremembered.Byconsequence,Jordan’seconomicliberalizationinthe1990swouldbehighlypartial,selective,uneven,andincoherent.

166

neopatrimonialismtoendure,thestate’sveryparticularinterventionsintheeconomyto

continue,andmarketcompetitiontoremainascompromisedasever.324

Withafewnotableexceptions,thestate’smass-orientedeconomicinterventionswereto

remainanchoredtothemodalityofwelfarismthathadbeeninstitutionalizedinthemid-

1970s.325Regardingtheconsumption-facingaspectofthatwelfarism,thoughstatesubsidieson

gasandoil(in1989)andwheat(in1996)werebrieflylifted326,andthoughtheregimewasforced

byitsDC-basedcreditorsintobrieflyflirtingwithmeans-testingsocialprotectionmoregenerally,

theIMFetal.wereultimatelyunsuccessfulindismantlinganyofthemajor(anduniversalist)

mechanismsthroughwhichpriceswerecontrolled.327Similarly,thoughpublichiringdiddecrease

324 Knowleshasarguedthatthenew,post-crisispoliticaleconomywasdifferentfromthepreviousiterationtothe

extentthatJordanianrentierismslowlymorphedfromthepetrodollar-financed,inducedstaterentierismofthe1970sand1980stoasomewhatnovel,marketorientedsystemofrentierism.

Bethatasitmay,thestatewouldhardlyberetreatingintotheroleofthenight’swatchman.Aquicksurveyofthe

JordanInvestmentCorporation’sholdingsduringthe1990scangivesomeindicationofthisnon-retreat.Asof1998,thisnominallyautonomouspubliccreditinstitutionstillheldanestimated40%oftheAmmanFinancialMarket’saggregatecapitalstockwhich.Thoughthe40%figureactuallyrepresentsaconsiderabledeclineascomparestoeventhreeyearsearlier(theJIC’sholdingswereupwardsof60%asof1995),itisstillanextremelylargelarger.WhenonealsoconsidersthatmuchofJICdivestmentfunctionedasaccountingmisdirection—specifically,manyoftheJIC’ssharesinstateownedandprivateownedenterprisesweresoldtotheSocialSecurityCorporationandothernominallyautonomous,governmentruncreditinstitutions—theregime’sdirectandindirectstakeintheeconomywaslikelytobemuchlargerthanthatalreadyenormousfigure.

325 See:PetersandMoore(2009),p.275;Knowles(2001),p.119326 Eachinstanceprecipitatedmassiveprotestandaswiftreversalinpolicyfromthegovernment.Ontheseprotests,

see: LamisAndoniandJillianSchwedler,“BreadRiotsinJordan”,MiddleEastReport(1996),pp.40-42. CurtisRyan,“Peace,breadandriots:JordanandtheInternationalMonetaryFund”,MiddleEastPolicy(6:2),1998,

pp.54-66. 327 Onthisultimatelynon-consummatedflirtation,seeKnowles(2001),p.251. Thatsaid,itshouldbeacknowledgedthattheMinistryofSupply—theinstitutionpreviouslyresponsiblefor

administeringthestate’ssubsidizationofgoods—wasdisbandedin1998.

167

duringthis period—andthoughcapsonnewemploymentdidimpartgenerationaltensionsinto

thelabormarket328—,thePalace/stateneverrenounceditsroleasemployeroflastresort.

Ifmassorientedinterventionsweremarkedbycontinuitiesmorethanchanges,thesame

couldnotbesaidofthestate’selite-orientedinterventions.329Here,thePalaceusednewmeansto

protectoldincumbentswhilesimultaneouslyintroducingnovelpolicymeasuressotoblooda

freshgenerationofprivatesectorelites.Specifictotheincumbents,theKingandhisallies

intervenedsotoshelterthisoldguardfromthevariousthreatsinherenttotheIMF’sreform

agenda.Whenitcametomacrostabilization,forinstance,andthevarioustax-relatedchanges

beingrequiredofhisregime,Husseinetalfirstmanagedtoprotectimport-dependentmerchants

throughinsertingahostofexemptionsintotheGeneralSalesTaxregime.330Acrosstheseyears,

theyalsoconsistentlyfilibusteredtheestablishmentofincomeandcorporatetaxcollection

systems.WhenitcametotheIMF’spushforcurrentandcapitalaccountliberalization,

meanwhile,theregimealsoarrangedthattheInvestmentPromotionLawof1995containeda

seriesofsector-specificlimitsonforeignownership.Inthismanner,suchrentier’sprotectionism

insulatedconstructionandcontracting,landandairtransport,tradingandtradeservices,

bankingandinsurance,telecommunications,mining,andagriculturalproductionfromsignificant

328 Thistensionmanifestedinpublicemployment’sprivilegingofincumbent,olderworkers(andtheirbenefits)and

thegulfthatsubsequentlyopenedupbetweenthosegrandfatheredintotheoldwelfarismandthethousandofyoungaspirantswhofoundthepathsthattheirfathershadwalkedinsecuringamiddleclasslifenowclosed(PetersandMoore,2009,p.277).

329 Thoughithasrightlybeenarguedthattherewasamovetore-formalizebusiness-staterelationsduringthis

period—amovenecessitatedbytheIFI’sinterventionsandnotinfrequentlyfundedandinstitutionalizedthroughtheUSAidmanagedEMIRproject—formalizationdidlittletomitigatetheenduringrentieristrelationshipbetweenaprivilegedeliteandtheregime.

330 Anani(2001),p.180.

168

foreigncompetitioninparticular—sectorsunitedbythefactthattheywereeachapreserveofthe

oldbourgeoiselite.331WhenthePalacedideventuallyacquiesce(inpart)totheIMF’swishes

regardingprivatization,finally,itwouldmediatetheprocessofpublicdivestmentsotosteera

numberofvaluableandprofitablestate-ownedenterprisesintothehandsofthesesame

clients/allies.SabihMasri’sacquisitionoftheJordanHotelsandTourismcompanyprovidesbut

themostfamousexampleofthiskindofcurated,non-competitive(anddiscounted)sale.332

Turningtothenewblood,itshouldbeacknowledgedthatHussein’shalf-hearted

privatizationcampaignalsoservedastheprincipalmechanismthroughwhichtheregime

integratedpoliticallyconnectedethnicTransjordaniansintotheelitefractionofthecapitalist

class.333Onoccasion,bothnouveauricheandoldelitecouldbeservedinthesametransaction.

Thesell-offoftheJordanTelecommunication’sCompany(JTC)in1995,oneoftheday’smost

profitableoftheSOEs,providedonesuchexample.334

331 See:Knowles,p.288.332 Onthissale,seeKnowles,p.248.333 Onthisaspectsofprivatization,see:YitzhakReiter,“ThePalestinian-TransjordanianRift:EconomicMightand

PoliticalPowerinJordan,MiddleEastJournal(58:1),2004,pp.72-92.Also,see:Wils,p.134;PetersandMoore,p.277;Schlumberger(2004),pp.150-158.

AsPetersandMooredocument,theRifaifamily’smigrationintotheeconomicelitewouldbemostillustrativeof

thisphenomenon.LeveraginghispositionasCEOofJordanDubaiCapitalalongsidehisfamily’sinviolablestandingwithinthepoliticalelite,SamirRifa’imanagedtoasserthimself(andtoextracthealthyreturns)duringthedisaggregationandselloftheJordanElectricityCompany.

334 1994legislationallowingforprivateinvestmentin“peripheralservices”--servicesincludingmobile

telecommunicationstechnologies—providedthejuridicalfoundationforthisprivatizationandtheriseofanumberofforeignowned,megacommunicationscompaniesintheearly2000s.

TheJTCtransactionwasoverseenbyShakerbinZaid,whojustsohappenedtoalsobethecousinofKingHussein

andthesonofthesittingPrimeMinisteratthetime.WorkingwithAliHusriandJamalSarayrah,binZaid’sstewardingofthebiddingprocesswasamasterclassineliterentdistribution,onethatsecuredtheinterestofhe

169

This,then,wouldbethewidereconomiccontextintowhichAbdullahibnHussein,aman

whowaselevatedtotheroleofCrownPrinceonlymonthspriortohiscoronation,walkedin

1999.Inthenextsectionofthisdissertation,Iwillexaminethecapitalismhehashelped

institutionalizeoverthecourseofthenexttwentyyears—andthesocialstructureof

accumulationthatholdsittogether.

andhiscolleaguesaswellastheinterestsofforeigninvestors,savvybureaucrats,andahandfulofoldscionsinonefoulswoop(Schlumberger,152).

FranceTelecomultimatelycameawaywith35%equity,theSocialSecurityCorporation(oneofthestate’s

autonomouscreditinstitutions)with8%,andArabBankwith5%(Knowles,243).WithDajaniAssociatesoverseeingthelegalpaperwork,thesametransactionalsofunneledheavyfeesintothecoffersofthatoldguardfamily.

170

SECTION2

Jordan’sSocialStructuresofAccumulation(1999-2019):StabilizingCrisis

171

CHAPTERSIX

Politics,policymaking,andtheinstitutionalizationofneoliberalcapitalism

Inthischapter,Iwilldiscussthepoliticalinstitutionalizationofcontemporaryneoliberal

capitalisminJordan.Atthelevelofwidestabstraction,thisdiscussionwilldemonstratethatthe

insulated,Palace-directedmodalityofeconomicpolicymakingpreviouslyinstitutionalizedby

Husseininthepost-1973periodhasbeenretainedbyhisson.Inaddition,itwillrevealthat

JordanianpoliticsunderAbdullahremainmoregenerallyorientedbythesupremacyand

prerogativesoftheunitary(monarchical)executive.ThoughthenewKing’sfluencyin

internationalnormsandvalues—andhisregime’snominalcommitmenttowards

democratization—mightpartiallyobscurethisfact,aspowerisstillwieldedautocraticallyandas

authoritariansurvivalisstillretainedastheorganizingprincipleofHashemitepolitics,this

analysiswillshowthattheweightofhistoryissignificant(ifnotconstitutive)whenitcomesto

thepoliticalaspectofthecontemporarySSA.

Allofwhichisnottosaythatcapitalism’spoliticalinstitutionalizationtodayiswhollyin

keepingwiththepast.Quitetothecontrary,thisanalysiswillalsodetailanumberof

transformationsthathavebeensuigeneristoandfacilitativeofAbdullah’sneoliberalturn.First

andforemostintheseregards,IwillshowthatAbdullah’sempowermentofpalaceappointed,

quasiautonomouspolicymakingbodieshasconsolidatedahistoricallyuniqueformofautocratic-

technocraticgovernance.Operatinginexplicitoppositiontothetraditionalapparatusesofthe

stateandincollaborationwithacoterieofforeignalliesasAbdullah’snocturnalcouncilshave,I

172

willdevelophowthisautocratic-technocraticgovernanceimbricatestwodecadesworthoffailed

developmentpoliciesaswellasthepoliticalandsocialtensionsthatarefundamentalto

Abdullah’srule.

ThischapterwillalsoforegroundhowthenewKinghaseconomizedhispoliticalclass335

andhowthistoohascontributedtothesocialdisembeddingofJordanian(crisis)capitalismin

the21stcentury.Wherethepreviouspoliticalclasshadusedtheircontrolofthestatenotonlyto

extractrentsbutalsotodistributethoserentstoawiderconstituency(howevercorruptlyor

inefficiently),itwillbedemonstratedthatAbdullah’seconomizedleaders—divorcedfromany

domesticsocialforceastheyare—seetoitthatrentsarenotonlyreallocatedupward,butthat

theyarefunneledalmostexclusivelyintothehandsofatransnationalcapitalistclasstowhich

theyaremember.Byconsequence,Iwillmakethecasethatcapital’scolonizationofgovernment

underAbdullahandthedisplacementsithasimplied(bothfortheoldpoliticalguardandforthe

traditionalstewardsofthebureaucracy)arebothfundamentaltoamodalityofaccumulation

characterizedbyhighinequality,highinefficiency,andelitebias.

Asregardschapterorganization,Iwillbreakmyanalysisintothreesubsections,eachof

whichwilldetailaseparateinstanceoftechnocratic-autocraticgovernanceinthecontemporary

period.ThefirstsubsectionwilladdressthecompositionandlegacyoftheEconomicConsultative

Council(ECC).ThesecondwillconsidertheAqabaSpecialEconomicZoneAuthority(ASEZA).

Thethird,finally,willkeyinonOmarMaa’ni’stenureasMayoroftheMunicipalityofGreater

335 Byeconomized,Irefertothemovementofprivatesectorelitesintopositionsofgoverningandpolicymaking

authority.

173

Amman(GAM).Collectively,theseinstancesoftechnocratic-autocraticgovernancewillbeshown

tohavearticulatedthelegislativeandjuridicalfoundationsoftoday’scapitalismofcrisis.Their

recordwillalsobesufficientsotoestablishhowthepoliticalmoregenerallypervadesthe

contoursofthecontemporarysocialstructureofaccumulation.

Importantly,Iwanttoemphasizeattheoutsetthattheorganizationandperformanceof

thethreeautocratic-technocraticpolicymakingbodiesreviewedinthischapterareindeed

representativeofmoregeneraltrendsincontemporaryeconomicgovernance/policymaking—

andarethereforewhollyunexceptionalwithinthecontextofAbdullah’sJordan.Atthelevelof

nationalpolicyplanning,forinstance,thistrendtowardstransferringofpowerawayfromthe

parliamentand/orstatebureaucratsandtowardspalace-aligned,technocraticbodieshasbeen

evincedmanytimesover.TaketheJordanianInvestmentBoard(laterrenamedtheJordanian

InvestmentCommission,orJIC)asanexample.NotunliketheECC,theJIC’smembershipis

royallyappointed,inclusiveofsomegovernmentofficials,anddominatedbyindividualsrecruited

fromJordan’svariousChambersofCommerceandIndustry.LiketheECCaswell,itsofficesare

linkeddirectlytothePrimeMinister’s,anofficefilled,ofcourse,byanotherappointeeoftheKing.

Grantedawidemandatewhenitcomestodevelopingandevaluatinginvestmentpolicy,theJIC’s

royalestablishmentthereforeepitomizesthesameinsulated,autocratic-technocraticgovernance

thatIwillbescrutinizingthroughtheexamplesoftheECC,ASEZA,andMa’ani’sGAM.Thesame

couldalsobesaidofEconomicPolicyCouncil.Foundedin2016,thisAbdullah-appointed

consultativebodyhasbeenempoweredtochartmajordevelopmentstrategies.Ittoois

comprisedofprivatesectorrepresentatives,representativesoftheRoyalCourt,andahandfulof

174

ideologicallyalignedgovernmentministers,andittooiswhollyunaccountabletoanypopular

institutions.336

Whiletheconstraintsofspaceandtheoreticalsaturationdictatethatthischaptershallnot

diveanyfurtherintothebusinessoftheJICorEPC,Ibrieflyreferencetheirexampleshere—andI

couldreferencemanyothers—inordertoreassurethereaderthatIhavenotcherrypickedthe

policymakingbodiesfeaturedhereinordertodistortormisrepresentthenatureofcapitalism’s

politicalinstitutionalization.Putsimply,mycaseshavebeenselectedbecausetheyarethemost

impactfulandemblematicexamplesofageneralizedphenomenon—andbecausetheyare

thereforethemostempiricallyrelevantandtheoreticallyilluminatinginstancesthatcanbe

studiedonthissubjectmatter.

(1)TheEconomicConsultativeCouncil(ECC)

InDecemberof1999,thefreshlyanointedKingappointedanEconomicConsultative

Council(ECC).LiketheESCbeforeit,thisCouncilwasestablishedunderthepretensethatit

provideanadvisoryfunction—thatithousethekindsofexpertisethatthecountry’spolitical

leadershipwouldneedastheydevelopedtheir(IMF-mandated)economicreformagenda.

Pretensenotwithstanding,theECCswiftlyacquiredlegislativeandadministrative

mandatesofwideremitandnegligibleoversight.Specifictotheformer,theECCwasenlistedto

supplythepolicycontentoftheroyaldecreesandprovisionallegislationthatAbdullahusedasa

336 ColinPowers,“Policyconvergence,(under)development,andJordanianeconomicsunderKingAbdullah”,Middle

EastLawandGovernance(forthcoming).

175

workaroundforhavingtodealwitheithertheSenateortheLowerHouseduringtheearlyyears

ofhistenure.337TheCouncil’slegislativepowers—whichwererathertotalbetween1999and

2003338—,wouldthenbematchedbyadministrativeprerogativesaftertheKingexploitedthe

upheavalandchaosborneofthesecondIntifadaandtheAmericaninvasionofIraqsotomove

membersofthisECCintohighleveraged,Ministerial-levelpositionswithinthebureaucracy.339

Operatingasadefactoprivateparliamentasmuchasanautonomous,royally-blessedcabal

withinthestateapparatus,theECCwastherebymadestewardofanewJordanianeconomy.

OfthetwentypeopleappointedtotheCouncil,fourteenhailedfromtheJordanianprivate

sector.340ContemporariesandpersonalassociatesoftheKing,themajorityofthisfourteenwere,

infact,legacychildrenofthequotacoterie—thegrandchildrenandgreatgrandchildrenofthose

familiesthathadrosetosuchprominenceinthe1940sduetotheEmir’smanipulationofwar-

timeimportlicensing.Complementingthepoliticallyknightedagentsofoldmoneywithin

337 Givenitsadvisoryremitanditslocationoutsidethestatebureaucracy,theECC’spathtolegislativeinfluencewas

notimmediatelyapparent.UpontheoutbreakoftheSecondIntifada(and,later,theIraqWar),however,eachofwhichprovidedcasusbelliforAbdullah’smoveagainsttheparliamentanddemocratization,thisinfluenceswiftlycametobefelt.Bycynicallyconjuringapoliticalemergency—andbydismissingtheparliament—,afterall,theconstitutionalgroundswereclearedforthemonarchicalexecutivetogovernthroughprovisionallaw.Nolongerneedingtocontendwithunrulyelectedrepresentatives,emergencyalsoprovidedforacontextwithinwhichtheECCcouldbeelevatedtoapositionofroyallyendorsedprominencewithouthavingtofaceunduepoliticalscrutiny.

338 Atleastasrelatestotheeconomy,ofcourse.339 AliAbuRaghebwasevenappointedPrimeMinisterin2001,withhiscabinetlargelyfilledbyECCmembersas

well.340 AsfurtherregardsthegenealogyofAbdullah’sneweconomizedelite,itisalsoworthnotingthatmanyamongst

theECC’snumberhadbeenenlistedinaUSAidLeadershipandTeamEffectivenesstrainingprogramatYaleUniversityduringthe1990s(DeBruyne,2013,p.157).NotonlywasJordan’semergentpolicyclassdominatedbytherepresentativesofdomesticcapital;itwasalsoacoteriefilledbysubjectstrainedandsocializedintheAmericanparadigmofliberaldevelopment.

176

Abdullah’seconomizedelite—KarimKa’war341,FawwazZu’bi342,GhassanNuqul343,Sabih

Masri344,KhalidTouqan345,MuhammedAbuGhazeleh346,NadimMu’asher347,Sahelal-Majali348,

RaghabedKurdi349,SuhairAliDabbas350,principally—wereasecondcliquerepresentativeof

Jordan’snew,tech-facingcapitalistclass.ProminentamongstthislattergroupwereFadi

Ghandour351,Salahal-

341 Ka’warwasandisoneofthebiggestplayersinJordaniantechnology,presidentoftheIdealGroupandInt@jat

thetimeofhisappointment342 Zu’biwasowneroftheAdritecGroup,anindustrialagriculturalequipmentfirm,atthetimeofappointment343 NuqulhadinheritedtheNuqulGroup,amassivefamilyownedconglomerateoperatingacrossanumberof

differentsectors344 Theoneelderstatesmanwithinthesebusinesselites,Masri,thecurrentChairmanofArabBank,wasrunning

ZaraInvestmentsandanumberofotherfinancialandrealestateenterprisesatthetimeofhisappointment.345 TouqanhadbeenPresidentofBalqaUniversitypriortohisappointment.346 Ghazeleh,thesonofTalalAbuGhazelehandhismassivelegalempire,alsoheldseniorpostsatDelMonteand

JordanianPoultry.347 Mua’sherwasDirectorofAhliBankandChairmanofArabInternationalHotelsCompanyandalDawliyafor

HotelsandMallsatthetimeofhisappointment.HewouldlaterbecomechairmanofElzayReadyWearManufacturingCompany,agarmentsmanufacturerawardedthestatusofaspecialeconomiczone.

348 MajaliwasfounderofMidContractingJordan,afirmthatwouldbeoneoftheprinciplebeneficiariesofthe

constructionboomoverseenbytheECCandthePalaceacrossthe2000s.MajaliandKurdiwereassignedtheECCportolioresponsibleforforeigninvestmentsandinvestmentclimate.Majaliwouldlaterbeimmersedinamassivecorruptionscandalcenteringonapublichousingcontract.

349 KurdiwasCEOofHayatPharmaceuticals,thelargestenterpriseinoneofthefewsectorsexperiencingsignificant

growthinthe1980sand1990s(growththatwouldcollapsefollowingthesigningoftheJordan-USFTA).350 SuhairwasworkingforCitybankatthetimeofherappointmenttotheECC.351 GhandourfoundedAramex,aninternationalshippingcompanyemployingmorethan2,000worldwide.

177

Dinal-Bashir352,MuhammedHalaqa,AliAbuRagheb353andBaseemAwadallah.354Headofthe

RoyalCourt’seconomicsdepartment,AwadallahservedastheKing’spointmanwithintheECC

andasthechiefarchitectofhisneoliberalredesign.355

Asregardsthatredesign,theECCusedthepoliticalhegemonyitacquiredbetween1999

and2002topasswhattheInternationalCrisisGroupdescribedasa“massacreoflegislation”,one

thatreorderedthebasicorientationoftheeconomy—andthatarticulatedanewformof

capitalismintheprocess.356Thenewnessofthiscapitalismwouldbeprimarilyarticulated

throughfiveinnovations:(1)expeditedandintensifiedeconomicopening;(2)atransferofpublic

assetsinto(particular)privatehands;(3)theinstitutionalizationofaclass-biasedfiscal

sociology;(4)apartialmonetaristturnattheCentralBankofJordan;and(5)bythedemarcation

352 Bashirisalawyer;hehasservedonmanysubsequentlyestablished“consultativebodies”suchastheEconomic

PolicyCouncil353 AbuRaghebhadbeenmanagingdirectorofNationalEngineeringandContractingCompanybetween1971and

1991,afterwhichhebeganhispoliticalcareer.HewouldalsobeoneofthemostinfamouscharactersfingeredinthePanamaPapersscandal.

354 TheinclusionofAl-Bashir—whowasmarriedtoReemBadran,daughterofthemany-timePrimeMinisterMudar

Badran—meanwhile,allowedtheKingtoincorporatesomeofthosefamiliesthathadbeensocentraltohisfather’shousepoliticsandstrategyofelitecirculationon-sideaswellasheshiftedpoliticalpowerdistinctlyinthedirectionofprivatesectorcapital(Schlumberger,139-140).Thoughnotoftheelitefractionofdomesticcapitalthemselves,finally,AbuRaghebandHalaqa—thelatterofwhichwouldserveasbothHeadoftheECCandDeputyPrimeMinisterintheformer’sgovernment—werethepoliticalclass’truebelieverswhenitcametoAbdullah’sneoliberalproject(DeBruyne,2013,p.157).Steadfastideologicalallies,eachwouldservethisprojectinanumberofdifferentcapacitiesacrossthecomingdecades.

355 Awadallahwouldlaterbeonthewrong-endofanendemicallypoliticizedanti-corruptionstruggle,anoutcome

thatforcedhimoutofgovernmentandmoreorlessintoaLondon-basedexile.356 TheInternationalCrisisGroup,“TheChallengeofPoliticalReform:JordanianDemocratisationandRegional

Instability”,Report(October,2013).

178

ofaneweconomicgeography—legallyachievedthroughtheestablishmentofaconstellationof

specialeconomiczonesandexportprocessingzones.

PoliticsinGeneralintheAgeofAbdullah:ALiberalKing,PerformancesofReform,andAnti-Democracy ThoughAbdullahcametoofficekeentostylehimselfintheaestheticofreformism,hisrevanchistauthoritarianismapparentfromtheveryinceptionofhisreign.SotoexpeditetherollbackofJordan’sdemocratization—arollbackthatwasongoingsincehisfather’ssigningofapeacedealwithIsraelatWadiArabahin1994—,theyoungKingfirstadoptedanumberofjuridicalmeasuresdesignedtoguaranteetheenduringinconsequentialityoftheparliament.Foremostamongstthesemeasures,upontakingpower,Abdullahimmediatelyensuredthatthemonarchicalexecutive’sdiscretionaryandexclusiveauthoritieswhenitcametopowersofthepurse,foreignanddefensepolicy,monetarypolicy357,thelegislativeprocess358,theappointmentofthePrimeMinisterandhis/hergovernment,andthedismissaland/orsuspensionofparliamentwereallretained.LeavingtheupperhouseofJordan’sparliament(theSenate)aroyallyappointedbody—andimpedinganyreformtothegerrymanderingandsinglenon-transferablevote(SNTV)methodthatfunctionedtocompromisetheelectoralsystemdeterminingthecompositionoftheparliament’slowerhouse—,heassuredthatthosedemocraticinstitutionsthatwereallowedtoexistwerehollowedoutandcompromisedaswell.359 Furthermore,thoughAbdullahwasforcedtoaccommodatethedemocratizingwhimsyofhisAmericansponsorsduringthefreedomagendaperiodoftheBushpresidency,eventhen,hewouldsoinamannerthatguaranteedhisautocraticinfrastructure—aninfrastructurecenteredonhisperson,theRoyalCourt,andtheGeneralIntelligenceDirectorate(GID)—neveractuallycameupfordebate.360AstheparametersoftheAbdullah’sdemocratichermeneuticswerealwaystobestructuredbytheontologicalpriorityassignedtoregimesurvival(first)and 357 Aswouldbecomeapparentduringthefinancialcrisisof2008,theindependenceoftheCentralBankofJordanis

nominalatbest.WhensubjectedtothepressuresoftheKing,itdoesasrequested,regardlessofthecountry’slong-termeconomichealth.

358 NotonlydidtheRoyalCourtretainsoleauthoritywhenitcametotheintroductionofbills,italsoretainedthe

righttolegislatethroughdecreeandtheissuanceofprovisionallaw.359 Formoreonthisdemocratichollowing,see:SeanYom,“ThenewlandscapeofJordanianpolitics:social

opposition,fiscalcrisis,andtheArabSpring”,BritishJournalofMiddleEasternStudies(42:3),2015. WhiletheauthoritariannatureofAbdullah’searlygovernancewasfarfromsubtle,itwouldgrowevenmore

explicitbytheearly2000s.WhenprotestsfilledthestreetsfollowingtheoutbreakofthesecondIntifadaand,slightlylater,thesecondAmericaninvasionofIraq,theKingwouldsuspendparliamentandrulealmostexclusivelythroughprovisionaldecreeupandthroughroughly2005.

360 See:ColinPowers,“Policyconvergence...”,MiddleEastLawandGovernance(forthcoming).

179

Thefirstoftheseinnovationswasoperationalizedthroughtariffratereductions,through

thefast-trackingofJordan’saccessiontotheWTO,andthethroughestablishmentofhighly

PoliticsinGeneral(continued)economicliberalization(second),agovernmentbyandofthepeoplewouldneveractuallybeonthetable.

Furthermore,thoughAbdullahwasforcedtoaccommodatethedemocratizingwhimsyofhisAmericansponsorsduringthefreedomagendaperiodoftheBushpresidency,eventhen,hewouldsoinamannerthatguaranteedhisautocraticinfrastructure—aninfrastructurecenteredonhisperson,theRoyalCourt,andtheGeneralIntelligenceDirectorate(GID)—neveractuallycameupfordebate.1AstheparametersoftheAbdullah’sdemocratichermeneuticswerealwaystobestructuredbytheontologicalpriorityassignedtoregimesurvival(first)andeconomicliberalization(second),agovernmentbyandofthepeoplewouldneveractuallybeonthetable. AsimilarperformanceofpoliticalreformtotheoneseenduringtheBushyearswouldcommencefollowingtheshockoftheArabUprisings.AsMariaJosuahascapablydetailed,2011-2012’sNationalDialogueCommittee(NDC),anotherbodymeanttoplotthecourseforsubsequentdemocraticreform,actuallyfunctionedandoperatedjustaspreviouslyaborteddemocratizationinitiativeshad.Tobegin,participantsinthisCommitteewerehandselectedbythePalace,whichallowedtheKingandhisRoyalCourttoscreenandexcludethemoreambitiousoftheregime’sdemocraticchallengers.Havingalreadycuratedthecommitteeinthismanner,thePalacewouldalsoinsurethataloyalistfactionwithintheinstitutionacquiredakindofproceduralistcontrolsotodictatewhatkindofreformswerebeingbroughtupfordiscussion. IfthemorepolitecontingentsofthedemocracymomentwerestifledthroughmachinationsattheNDC,othersweremanagedthroughadeftstrategyofselectiveco-optation.ForthefrustratedMilitaryVeteransthathademergedasasignificantoppositionforceduringtheseyears,co-optationwouldbeinstrumentalizedthroughmakrama1,wageincreases,andincreasedpublicsectorhiring.Havingtherebytakenawaysomeofthegrievancesmobilizingthemovements,theregimenextworkedtopickoffmanyofthisopposition’smostcapableleaders—includingKhalidKalaldehoftheSocialLeft,whowasappointedMinisterofParliamentaryAffairsin2015andwholaterservedasElectionCommissionPresident—byintegratingsaidactorsintotheseniorranksofthestate.RenderedsomewhatrudderlessanddisorientedbythePalace’sinterventions,theearlypromiseofthismilitarizedrevolteventuallydissolvedintoineffectuality.Asforthemoreantagonisticoftheactorspushingfordemocracyatthisstage—actorssuchasAl-HirakandtheSouthernMovement—,theregimewoulduseahostofmorekinetic-coercivemeanstobreaktheirmomentum.

180

invasivefreetradeagreements(FTAs)withtheUnitedStatesandEuropeanUnion.361Morethan

openingtheJordanianeconomytotheworld,themodalityofglobalintegrationthereby

institutionalizedbytheECC/PalacewouldalsoimplywholesalechangestoJordan’sregulatory362,

tax,investment,andindustrialpolicies,asIwilllaterdetail.

TheECC/Palace’sselectiveoffloadingofpublicassets—policies,itshouldbesaid,that

werelegitimatedthroughappealtothesamepromisesandnecessitarianargumentsaswere

typicallyarticulatedbyeconomistsattheIMFandWorldBank363—,meanwhile,waslargely

achievedthroughPrivatizationLawno.25of2000.PriortothepassageofLawno.25,

privatizationhadproceededinapiecemealfashion.Foreachentitythatthestatewastodivest

from(inpartorinwhole),specificlegislationneededtobewritten,debated,andapprovedbythe

parliament.Thediscreteproceduralismbakedintosuchaprocessallowedactorsbothwithin

parliament364andthelargerapparatusofthestatetointerjectthemselvesandtheir

constituenciesintonegotiationswithprospectivebuyersandinvestors.Whileoccasionally

361 35%inthemid-1980s,theratewasbroughtdownto13.5%asofearly2000.362 FerrisNesheiwat,‘TheadoptionofintellectualpropertystandardsbeyondTRIPS-isitamisguidedlegaland

economicobsessionbydevelopingcountries’,LoyolaLAInternationalandComparativeLawReview,32,2010,pp.361-394.

363 Jordanianpolicyplanners,likeBankeconomists,madethecaseforprivatizationbysuggestingthatthereceipts

fromsalescouldbeusedtofinancepublicinvestmentininfrastructuralupgradesandhumanresourcedevelopment.ThePrivatizationLawof2000hadstipulatedthatupto15%ofthereceiptsgainedthroughprivatizationwouldbereinvestedininfrastructureandretrainingprograms.Whethermadeinbadfaithornot,suchanarrangementnevercametopass,assubsequentlendingagreementswiththeIMFwouldearmarknearlyalltheproceedsfromprivatizationforexternaldebtbuybacks.

FortheBank’sdiscourseonprivatization,see:TheWorldBank,ClaimingtheFuture:ChoosingProsperityinthe

MiddleEastandNorthAfrica,(Washington,DC:WorldBank,1995)364 Inparticular,PrimeMinisterMajaliandtheEconomicandFinanceCommitteeoftheLowerHousewouldplaya

criticalroleinpumpingthebrakesonmanyofthesetransactions(Knowles,2001,p.240)

181

successfulinstonewallingaprivatizationinitiativealltogether—aswasthecasein1998during

theattemptedprivatizationoftheAqabaRailwayCorporation365—,thepoliticizationofthese

processesalsoallowedstaterepresentativestomoregenerallyexerttheirleveragesotooffer

somemodicumofprotectiontotheworkersthatmightbeaffectedbyasale.Amongstother

examples,itwasthroughthesekindsofpoliticizedinterventionsthatthegovernmentretained

ultimateboardcontroloftheJordanianCementFactorydespiteLaFarge’sacquisitionof36%

equityin1998.366

ThepassageofLawno.25andthestreamliningofprivatizationthatitallowed,then,not

onlyexpeditedthemassoffloadingofpublicassets;italsoremovedwhatlimitedprotection

parliamentarymediationhadpreviouslyprovidedtothosemostlikelytobeaffected.367Withina

matterofmonths—assoonasOctoberof2000tobespecific—,andunderthedirectsupervision

oftheECC,thirty-fourofthefortycompaniestargetedforstatedivestmentundera1997strategic

planhadbeenfullyorpartiallyprivatized.368Thisincludedanumberofthecountry’slargestand

mostvaluable(ifunprofitable)assets,includingRoyalJordanianAirlines,theJordanian

TelecommunicationsCompany,theJordanPhosphatesMiningCompany,andtheArabPotash

Company.

365 Knowles(2001),p.244366 ThesekindsofinterventionsalsoimposedconditionsofpurchaseonLafargethatrestricted,atleasttemporarily,

anypost-factodismissalofworkers(Knowles,241)367 SufyanAlissa,“RethinkingeconomicreforminJordan:confrontingsocioeconomicrealities”,Report:Carnegie

MiddleEastCenter(2007),p.12.368 Knowles(2001),p.245

182

Unlikethesecondinnovation,theECC’sinstitutionalizationofaclass-biasedfiscal

sociologyrequiredanumberofsynchronizedsteps.Ontherevenuessideoftheledger,thisbegan

withtheimpositionofaregressive,downwardlypunitiveValued-Addedtax.369Thedislocating,

polarizingeffectsthatwereintroducedthroughtheVATwerethencompoundedbyboththenon-

establishmentofprogressiveincomeorcorporatetaxregimesandbytheextensivetax

exemptionsthatthestateoptedtoofferforeigninvestorsinparticular.Ontheexpendituresside,

reductionsinsocialandcapitaloutlays—institutionalizedinthenameoffiscalconsolidation—

onlyfurtherconsolidatedthedistributivelogicattheheartofthiscapitalism’snewfiscal

sociology.370

AsforthePalace-ECC’smonetaristinnovations,theirinstillingofpricestabilityasthe

singularmandateoftheCentralBankwouldmakeitnearlyimpossibleforfuturegovernmentsto

upholdmanyoftheirconstitutionallyinscribedsocialobligations,furtheracceleratingthe

disembeddingoftheeconomy.371TheECC’sdemarcationofaneweconomicgeography,finally,

was,asmentioned,operationalizedthroughtheestablishmentofanetworkofspecialeconomic

zones(SEZs)andexportprocessingzones(EPZs).Juridicallyconstructedsoastobeoutsidethe

laws,rules,andregulationsofJordanproper,thesezones—someofwhichareprivatelyowned

andmanaged—alsoprovidedfirmsoperatingwithintheirjurisdictionwithanextensivelistof

369 ItshouldbeacknowledgedthattheVATwasonlyimplementedin2001;priortothat,Abdullah’srevenuestrategy

relieduponanequallypunitiveGeneralSalesTaxregime,however.370 Reductionsincapitalspendingofcoursealsounderminedlong-termgrowthprospectsaswell.371 TheJordanianconstitutioncontainsprovisionsregardingajobsguaranteeaswellasothersdefiningthestate’s

remitasbasedonthemaximizationofemploymentandthedeliveryof“higherandmoreequitabledistributionofincome.”

183

non-conditionalsubsidies,taxbreaks,andinvestmentincentives.Thisinnovationwouldcometo

beimplicatedinmanydimensionsofthecontemporarysocialstructureofaccumulation,

informingeverythingfromthesocialcontrolregimethatstabilizesaccumulationtodaytothe

formsofmarketcompetitionandprofitseekingnowprevailingtothiscapitalism’s

developmentallydisastrousexternalarticulation.

TheECC’sdemarcationofaneweconomicgeographyalsoseguesratherperfectlyintothe

nextpolicymakingbodytobediscussedinthischapter.Thestoryherebeginswiththe

aforementionedmassacreoflegislationandwithLawno.32of2000inparticular.Writtenin

consultationwithSeniorLegalAdvisorsfromDeloitteConsulting372(namely,Jean-PaulGauthier)

andsteeredthroughintenseCabinet-leveldebatesbyAliAbuRagheb373,thislaw,partandparcel

oftheefforttolegallydefineanewgeographyinJordan,conjuredintoexistencearatherbizarre,

quasi-extranationalspaceitcalledtheAqabaSpecialEconomicZone.374

372 Unsurprising,perhaps,tostudentsofcontemporaryglobaldevelopment,thegenealogyofASEZAultimately

tracesbacktotheboardroomsofprivatemanagementconsultancies.TheprincipalactorsinvolvedindevelopingtheideaofanexportprocessingzoneinAqabawereGenslerArchitects,ECO-Consult,andAECOMInternational,eachofwhomhadbeencommissionedforthisworkbytheWorldBankand/orUSAid(DeBruyne,169).BorrowingheavilyfrommodelsandrationalitiesinitiallydevelopedthroughUSAid’sexperimentationwithexportprocessingzonesinthePhilippines,theplanstheconsultanciesultimatelycameupwitharerepresentativeoftheperversesouth-to-southlearningthathasbecomesocommonincontemporarydevelopment.

373 Onthesecabinetdebates(wherethevastmajorityofthegovernment’sministersexpressedresistanceto

Abdullah’sdesiredspecialeconomiczone-policies,andwhereAbdullaheventuallyhadtosidestepthatcabinetandthetraditionallegislativeprocessasaresult),see:MarwanKardoosh,“TheAqabaSpecialEconomicZone,Jordan.”Paper:WorldBankGovernanceKnowledgeSharingProgram,PolicyInitiativesandReformsintheMENARegionWorkshop(2004),pp.15-18.

374 OnGauthier’sinvolvement,see:LocusEconomica,“AdvisingonJordan’sSpecialDevelopmentAreasLaw”

(availableat:http://www.locuseconomica.com/blog/2016/9/2/assisting-jordans-special-development-areas-law).

184

TheAqabaSpecialEconomicZonewasbizarrebecauseunlikeJordan’sotherspecial

economiczones—whichweretypicallyestablishedonnon-residential,relativelymarginal

industrialestates—,thisonewastoincludeoneofthecountry’slargestcities(Aqaba)withinits

borders.Ratherthanextractingsomeperipheral,peoplelesslandscapefromthelegaljurisdiction

ofthenationalgovernment,then,Lawno.32wastounilaterallyrelocateanentiregovernorate

(constituting7.4%ofJordan’stotalterritoryandpopulatedbymorethan111,000)intosome

strangeetheroutsidethedirectpurviewofthestate,electedrepresentatives,and,inmany

instances,thelawitself.375Theresidentsofthiszoneweretohenceforthbegovernedbyan

unelectedbodycalledtheAqabaSpecialEconomicZoneAuthority(ASEZA),anAuthoritywhose

state-chargedremitcenteredonattractingforeigninvestmentanddrivingexportsbeforeallelse.

Tothisbodywenowturn.

(2)TheAqabaSpecialEconomicZoneAuthority(ASEZA)

FollowingthepassageofLawno.32,Aqaba’sfullreconstitutionasaspecialeconomiczone

governedbythediscretionaryauthorityofanunelectedrulingbody(ASEZA)alonewasnotyet

375 See:Debruyne(2013),p.172. ThiswasfinalizedandmadematerialinMayof2001whentheAqabaMunicipalgovernmentwasdissolvedand

theAqabaSpecialEconomicZoneAuthority(ASEZA)beganitsrule.ThoughtheresidentsoftheAqabaSpecialEconomicZone(atleasttheJordaniannationalsamongstthem)retainedtheirconstitutionalstatusasJordaniancitizensandthoughthelandsthemselvesweretoremainthesovereignpossessionoftheHashemiteKingdom,thislegislationnonethelessremovedAqabaanditspeoplefromJordanproperinaverysubstantiveway,asIwilldetail.

185

complete.Indeed,agreatdealinthewayofjuridicalacrobaticswouldstillberequiredof

Abdullah’spolicyelite.376

Morespecifically,suchacrobaticswereneededinordertocarrythroughwhatwerelegally

complextransfersofpowers,transfersthatwouldtakeauthoritiespreviouslyinvestedin

governmentministriesorelectedofficialsandreassignthemtoASEZA.Inimplementingthese

transfers,Abdullah’spolicyeliteultimatelyandprimarilyreliedupontheissuanceof

MemorandumofUnderstanding.Eighteensuchmemoranda,infact,weresignedoverthecourse

oftheearly2000s—memorandathatwerenot,ofcourse,subjecttopublicoversightandthat

containednomechanismsforpopularparticipation.

Collectively,theseMoU’sascribedASEZAlegaljurisdictionforareasofgovernancefar

beyondthedevelopmentinitiativesthathadinitiallydefineditsremitandraisond’etre.Granted

“financial,fiscal,andadministrativeindependence”,operatingitsownvisaandworkpermit

system,managingtheeducationalsystemforhundredsofthousands,andhandlingportfoliosas

diverseassecurity,povertyalleviation,roadbuilding,andsocialdevelopment,ASEZAwasmadea

sovereignandindependentstateinallbutname.AsonecommunicationsofficerforASEZAlater

remarked,“thereisbutonegovernmentinAqaba(and)thatisASEZA.Wearesurroundedbyfour

countries,includingJordan.”377

Theaggregateeffectsofthesetransfersthroughmemorandawerenotonlytorender

ASEZAadefactostatewithinthestate,however;theywerealsotoempowerasmallcabalof

376 InadditiontothecityofAqaba(andthecity’sport),WadiRumandWadiAraba,theformerofwhichstandsas

oneofJordan’sbiggesttourismassets,werebothredistrictedtoASEZAaswell.377 See:Debruyne(2013),p.174-175.

186

formerECCstaffers378withinASEZA’sdefactostatewithtotalizingandautocraticpowersof

governance.379ByvirtueofASEZA’sorganizationalstructure—astructurethatseparatedthe

Authority’soperationsintosixdiscretedomains,eachofwhichwastobepresidedoverbya

Commissionerinvestedwithsubtantialdiscretionarypower380—,ameresixindividuals,infact,

colloquiallyreferredtoasal-Mufawwadiyya,wereabletobuildandrulewhatamountedto

localizedfiefdomsinAqabathroughpersonaldiktat.Theydidso,moreover,whileworkingin

collaborationwithBechtelCorporation,therathernefariousAmericanconstructiongiantwho

managedtoprocureaninterimcontract(afteralargelynon-competitiveprocess)forthe

managementanddevelopmentofthespecialeconomiczonein2002.381

378 AsregardsthoseformerECCstaffers,acrossthe2000s,ASEZA’srotatingal-Mufawwadiyyafilleditsrankswith

personneleitherdirectlytransferredfromtheAmman-basedconsultativecouncilorenlistedfromthewidercohortofinternationally-oriented,privatesectorbourgeoiselites(fromwhichtheECChaditselfrecruited).

Thatsaid,onecaveatshouldbenoted:thefirstChiefCommissioner,MohammedKalaldeh,hadgenuinelysought

toembedtheAuthorityinthesocialfabricofAqabaandtoanchordevelopmenttotheneedsoflocalpeoples.ItwasnotuntilAqelBiltaji’sappointmentasChiefCommissionerthattheneoliberalkingsmenfullytookover.

379 Interestingly(andIwilldetailinchaptereleven),policymakersattemptedtolegitimatetheanti-democraticcoup

internaltothistechnocratic-autocraticformofgovernancebyevokingmanyofthepublicchoicetheory-basedscriptsthataresocentraltothewiderneoliberalturn.Positedastheantithesisofthepolitical—aconceptthatwasitselfontologicallyinvestedwithshortsightedness,irrationality,localparticularism,andthecorruptionsofspecialinterests—,ASEZAwasconjuredandsoldasanecessarynegation,asamodalityofergonomic,rationalizedanti-politicsconcernedorientedpurelywiththeuniversalinterest.Inanactofdiscursiveinversion,theobviousproblemsintrinsictoASEZA’sautonomy,insularity,andmoregeneralfreedomfromoversightarethereforereframedasasolutiontotherent-seekingsystemofwastathatwastoblameforJordan’senduringunderdevelopment.AsImadFakhouriwouldputit,unlikethepoliticians,ASEZAgovernedin“thecommonandpublicinterestinsteadofprivateandsmallerscaleinterests”(DeBruyne,180).ASEZAwasheretogetthingsdone—whichmoreimmediatelytranslatedintoattractingforeigninvestorsintotheeconomiczone,atwhichpointgrowthandwelfaregainscouldbeassumed—,andthatwasallthepeopleofAqabaanditsenvironswantedanyway,asBilalal-Bashir,aformercommissionerwiththeAuthorityasserted(DeBruyne,168-180).

380 AtopthisorganizationalstructuresataChiefCommissioner.Whileultimatelyaccountabletotheofficeofthe

PrimeMinister,theAmman-basedgovernment’soversightofASEZAwasnominalatbest.SeeDeBruyne,174,formoredetails.

381 OnBechtel,see:Kardoosh(2004),p.26-27.

187

ProblematicasASEZA’sorganizationalstructurealreadywas,matterswouldonlyget

worsefollowingarestructuringofoperationsin2004.Thisrestructuringwasinformedbythe

Palace’sfrustrationswiththelevelsofforeigninvestmentthatwerebeingattractedintothe

specialeconomiczone,anoutcomethattheKingetalbelievedtobecausedbytheundue

influencethatstubbornlocalinterestswereexertingonASEZA’s(alreadyremarkablyinsulated)

governingapparatus.382OnthebasisoftheRoyalCourt’speculiaranalysis,itwasdeterminedthat

ASEZA’sday-to-dayoperationsinthefieldofeconomicdevelopmentneededtobeoutsourcedtoa

freshlyfoundedshareholdingcompanycalledtheAqabaDevelopmentCorporation(ADC).

Importantly,thoughthisentitywasjointlyownedbyASEZAandtheJordaniangovernment,its

seniorstaffwastobecomprisedalmostentirelyofnon-nativemanagementconsultants.Gerry

Post—amanwhowouldpopupagainduringAmman’surbanrenewal—andtheaforementioned

Jean-PaulGauthier(whowasnowrunningafirmcalledTheServiceGroupinadditiontoretaining

hisongoingaffiliationwithDeloitte383)tooktheleadamongsttheseconsultants.384

DuetothefactthattheADCwaschargedwithhandlinganumberofdiverseandimpactful

portfolios385,thedecisiontostafftheorganizationwithforeignmanagementconsultants,likethe

decisiontobringBechtelinasapartnerin2002,wouldprovedeeplyconsequentialinshaping

382 GiventheAuthority’salmosttotalinsulation(legallyorotherwise)fromlocalpolitics,thiscausalexplanation

seemsdubious.383 Gauthierwouldgoontofound(andserveasCEO)forLocusEconomica,aninternationalconsultancyexplicitly

workingonspecialeconomiczonepolicy.384 PostetalfirstworkedunderthebannerofafirmcalledBearingPointIncorporated.Thatfirmwasacquiredby

DeloitteduringtheADCcontract,however.385 AsIwilldetail,theADCwascentraltothesaleofAqaba’sportandtotheestablishmentofmassiverealestateand

industrialdevelopmentprojects

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notonlythedevelopmentplansthatwouldphysicallyreshapeAqaba,butalsothelocalformof

capitalismthatwouldultimatelycometoprevailinJordan’swest(east).AsUSAidhadalsobeen

heavilyinvolvedinASEZA’sworkfromtheverystart,moreover,theforeignpenetrationofthe

economicpolicyprocessinAqabaextendedwellbeyondthemanagementconsultantsalone.386

Withinal-Mufawwadiyya’srotatingcastofneoliberalKingsmenitself,themanwho

ultimatelyinfluencedthefateofAqaba’ssocial,political,economic,andphysicalfuturesmore

thananyotherwasImadFakhouri.ThoughanacolyteofGenerationAbdullah,Fakhouri’spathto

prominencewasslightlydifferentthantheotherselfstyledtechnocratswhohadbeenso

privilegedinpolicycirclesfollowing1999’sroyalsuccession.WhileFakhourihadbrieflyserved

histimeintheprivatesectorasChiefOperatingOfficerforCenturyInvestmentGroup(2000-

2002),theHarvardandNorthwestern-educatedmanhadspentthemajorityofhispre-ASEZA

professionalcareershuttlingbetweenthestatebureaucracyandjobswiththeUnitedNations

DevelopmentProgramme.IftheseprofessionalexperiencesmadeFakhouridifferentthanthe

businessmentypicallyfavoredbytheyoungKing,hewouldbesimilartohiscolleaguesinthathe

toolackedanysubstantivelinkagetoadomesticsocialbase.387Equallyamatchforanyof

Abdullah’sboyswhenitcametohisneoliberalfidelities,Fakhouriwouldproveasfaithful,

386 AidcollaboratedwithASEZAviaitsAqabaTechnicalAssistanceSupportProgram,theAqabaZoneforEconomic

MobilityProgram,andtheAqabaCommunityandEconomicDevelopmentProgram. Formoreontheseforeignentanglements,see:Debruyne,p.177-179.387 See:Alissa(2007),pp.13-15. Inafittinglyneoliberalfashion,thisGenerationAbdullahofcoursepresentedtheirdivorcefromdomesticsocial

constituenciesasasignoftheirstrengthandcredibility—asaself-sufficientdemonstrationthattheywerebeyondwastaandparochialcorruption.

189

tireless,andeffectiveaservantasanyoneelseduringtheinitialyearsofASEZA’stransformational

project.

Fromanumberofdifferentposts—FakhouriwasnamedCommissionerforInvestment

andEconomicdevelopmentupontheformationofthespecialeconomiczonebeforebeinglater

appointedasCEOoftheaforementionedAqabaDevelopmentCorporation(ADC)—Fakhouri

woundupsteeringmanyofal-Mufawwadiyya’smostcriticalpolicydecisions.388Joininghim

duringtheseseminalmomentswasDr.Bilalal-Bashir.SecondonlytoFakhouriwhenitcameto

influenceoverthespecialeconomiczone’slong-termdevelopment,Dr.Al-Bashir,whoisthe

brotherofECCmemberSalahal-Bashir,initiallyoperatedfromtheperchofCommissionerof

EnvironmentandTourism.Later,hetookonthepostsofCommissionerofInvestment,Deputy

ChiefCommissioner,andDirectoroftheDevelopmentZonesCommission,respectively,acrossthe

midtolate2000s.FlankinghimandFakhouriforthemajorityoftheseyears,moreover,wereDr.

Saleemal-Moghrabi,Dr.KamelMahadin,andMohammedBalqar.389

MarryingembourgeoisedautocracywithDeloittehackeryandUSAid-authorednotionsof

development,ASEZA’sgovernanceunsurprisinglyyieldedanumberofdeeplyproblematic

economic,social,andpoliticaloutcomes.Amongsttheseoutcomes,oneneedbeginwithASEZA’s

388 OnFakhouri,see:Schlumberger(2004),p.142;andKardoosh(2004),pp.33-34.389 Carefulnottofullyupsetthepoliticalapplecart,itisworthnotingthatthePalacealsosawtoitthatanumberof

ideologicallyagreeabletraditionaleliteswereappointedtopositionsofpowerwithASEZAacrosstheyears.TheAuthority’sfirstCommissionerforcustomsandrevenues,forexample,wasoftheRifa’ifamily,oneoftheoldstalwartsofAbdullah’sfather’sautocraticsystem.SalehKilani,ascionoftheoldelitehimself,moreover,wasalsobroughtin,firstasCommissionerforFiscalRegulationandDevelopmentandlaterastheChiefCommissioneroftheDevelopmentZonesCommission(Debruyne,p.175).Theeconomiczone’sfirstinvestor,meanwhile,wastheJordanianIndustrialEstatesCorporation(JIEC),apubliclymanagedentitythenrunbyAmeral-Majali,himselfthesonofoneofthecountry’sseniormilitaryfamilies(Ibid)

190

facilitation(andsubsidization)ofluxuryrealestatedevelopments.Thesedevelopmentstypically

proceededasfollows:advisedbythemanagementconsultantsrunningtheADC,relevant

CommissionersatASEZAuseddiscretionaryauthoritytoevokeimmanentdomainovercritical,

legallyambiguousterritories.Havingseizedtheselands(inthenameofthepublicinterest)—and

havingdisplacedthethousandslivingthere—,ASEZAthensellstheemptiedspacestoprivate

developers(atdiscountedprices).390ASEZAsubsequentlyfinancestheinfrastructuraloutlays

thatwillberequiredbysuchdeveloperswhilealsoaffordingallfirmsoperatingwithinthe

territoryofthespecialeconomiczonewithaconstellationoftaxbreaks,investmentincentives,

andlaxlaborregulations.391

Whilethesearrangementswerenominallyconditioneduponthedeveloper’swillingness

todevotepartofthelandacquiredforindustrialinvestment392,anysuchconditionswereto

provewhollynon-bindinginpractice.Byconsequence,apartfromtheexpectationthattheyoffer

afewsalutaryremarksasregardssustainabledevelopment,jobcreation,andtechnological

transfers,developerswerefreetoallocatetheentiretyoftheir(subsidized)investmentinto

390 Formoreonthesetransactions,seeDebruyne(2013),p.185391 SeeDebruyne,179-181,fordetailsonASEZA’sleadership. Iwilldetailthenumeroussubsidiesprovideddevelopers—fromdiscountedlandsalestotaxbreakstoASEZA’s

coveringofkeyinfrastructuretothestockofcheapforeignlaborASEZAprovisionedthroughitsworkpermitpoliciestotheinvestmentcapitalprovidedbypubliccreditinstitutionsliketheSocialSecurityInvestmentFund—inthenextchapter.Asboardmembersfromsomeoftheseprojects—suchasSahlDudinofAylaOasis—actuallysitontheboardoftheSocialSecurityInvestmentFund(andasMuhammedalZu’bi,anotherkeyallyfromGenerationAbdullahactuallysitsaschairmanoftheprivatizedSocialSecurityCorporation,Iwillalsodetailhowinjectionsofpublicmoneyscometobeprovidedanytimeoneoftheseprivateprojectswascomingupshortintermsoffinancingaswell.

392 Typically,thePRroll-outfortheselandsalesemphasizednon-bindingcommitmentscallingfor15%oflanduse

tobedevotedtoindustrialprojects.

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hotels,highrises,andluxuryamenities.Functionallyspeaking,then,theautocratic-technocratic

governanceofASEZAreducedtothepublicsubsidizationofrealestate-basedspeculation.

Moreover,iftheinvolvementofforeignconsultantsandtechnocratsintheautocratic

governancejustdescribedmayhavealreadyhelpedverifythetransnationaldimensionsof

Jordan’ssocialstructureofaccumulation,sotoowouldareviewofthosebenefitingfromthis

governance.Indeed,ifonesurveysthemegaprojectsconsolidatedthroughprocessesliketheone

hithertodetailed—projectsincludingAylaOasis393,TalaBayResortComplex394,MarsaZayed395,

andSarayaAqaba396—,onewillseethatineachinstance,therosterofmajorequityholders

countsasmanyGulf-basedcapitalistsasitdoesJordanianones.397Inmanyways,theseAbdullah-

erajointinvestmentsinthebuiltenvironmentactuallyfunctionedtocrystallizethiscoming

together,ortransnationalization,ofthecapitalistclassinJordan.FacilitatingtheGulf’seconomic

colonizationofthecountryatthesametimeasitsecuresnon-productionbasedprofitsfor

privilegeddomesticelites,thisisatransnationalizationthatisinmanywaysconstitutiveofthe

393 SabihMasriwasthefounderoftheAylaOasisDevelopmentCompany.TheBoardconsistsofKhaledMasri

(Chairman),KamilSadeddin(BoardmemberofanotherMasriowned,SaudibasedcompanycalledtheAstraIndustrialGroup),FouadTuffaha(alsoadirectorattheAstraGroup),SahlDudin(whoisalsoaboardmemberfortheSocialSecurityInvestmentFund,anappendageoftheSSC),andShirinMasri.

394 TalaBayisownedbyJordanProjectsforTourismDevelopment,acompanyinitiallyfundedbyUSAid.Thelargest

shareholderisAbujaberBrothersCompany;theotherprimaryinvestorsareOhrInvestmentHoldingCompanyLtd(basedintheBritishVirginIslands),MadarFinanceandInvestments(basedinDubai),theSSC,Orascom,andFaiqalSayegh.

395 TheprimaryinvestorinMarsaZayedwasAbuDhabibasedal-MaabarJordanRealEstate,andtheprojectwas

moredirectlyimplementedbyEagleHillsJordan,anAbuDhabibaseddevelopmentcompany.396 ArabBankandSaudiOgerremainthemajorinvestorsinSaraya.ThoughMasriisChairmanofArabBank,the

SaudiSovereignWealthFundandtheHaririfamilyeachholdmassivestakesintheBank.397 Inthenextchapter,IwillalsoaddresshowASEZAfacilitatedthere-exportationofgarmentsintotheAmerican

market,andtherebyhowithasalsoservedtobenefitcapitalfromsouthandeastAsia.

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economy’stendenciestowardscrisis,aswillbecomeclearerandclearerthroughouttherestof

thistext.398

Importantly,itisworthnotingthattheeconomiccolonizationthathastherebybeen

encouragedthroughASEZA’sautocratic-technocraticgovernanceextendswellbeyondtheGulf’s

acquisitionofequitysharesinAqaba-basedgolfcoursesandvacationresorts.Thisisa

398 Onthedomesticfront,Jordan’soldmoneyaswellasahandfulofnewactorsmadeoutsimilarlywellfromthese

developmentprojects.Amongstthatfirstgroup,theMasriandAbuJaberfamiliesreceivedthebiggestbumpfromthelandspeculationfacilitated(andsubsidized)byASEZAduringtheseyears.ForSabihMasriinparticular,hisArabBankandZaraInvestmentHoldingCompanyhadeachacquiredvastequityholdingsinAylaOasisandSarayaAqaba;asAylaOasisaloneconsistsofaHyattRegency,agolfcoursefurnishedwithitsownseparateaccommodations,279apartments,andaretailvillagecontainingsixty-eightboutiques,thisequitysecuressubstantialanddiversesourcesofrent.WithasignificantstakeinTalaBay,meanwhile,AbujaberInvestmentsandAbujaberBrothersCompany’spullthesametrickjustafewkilometersdowntheroad.

AsforthenewactorsgrabbingthemselvesapieceofthepieinAqaba,twomilitaryentities—MawaredandAl

Haqq—and,allegedly,membersoftheroyalfamilyarethemostdeservingofdiscussion.Iwilldiscusstheformerinfargreaterdetailinthechapterthatfollowsthisone.Bywayofintroduction,fornowIwillonlysaytwothings:first,thattheseinstitutionsarerepresentativeofanentrepreneurialturnintheJordanianArmedForces—aturnthathasgeneratedandcontinuestogenerateagreatdealofconsternationwithinwhatwaspreviouslyasteadfastbulwarkofHashemitepower.Andsecond,thatMawared,havingbeengrantedlegalcustodianshipoverallthemilitary’spropertiesandland,hasfoundthekindsofmegarealestatedevelopmentprojectsdescribedonthepreviouspageparticularlyconducivetoitsinterests,asitisgenerallyabletoleverageitsofficialownershipofpubliclands(anditscontroloverpermitting)intoequityintheprivatehotels,etc.,thataresubsequentlybuiltonthoselands.Inthismanner,MAWAREDacquiredastakeinZaraInvestmentHoldingCompany,forinstance,whichisitselftheprimaryinvestorinAylaOasis.

Connectingthistotheroyals,thereiswidespreadspeculationthattheKinghimselfownsaspieceofMawared’s

growinginvestmentempire,andthatheandhiswifearealsopartnertoahandfulofotherobscurefinancialinstitutions—suchasRubiconGroupHoldings—thataresimilarlysubscribedtoRedSea-centeredrealestatespeculation(Debruyne,p.184).

RegardingtheGulf-basedparticipantsinthispalace-sponsoredgrift,AbuDhabi’sAl-MaabarJordanRealEstate,

Dubai’sEagleHillsJordan,Dubai’sMadarFinanceandInvestments,andSaadHariri’sSaudiOgerhaveallsecuredhealthyprofitsinAqaba,beitthroughtheequitytheyheldinthearea’svariouspropertiesandprojectsorthroughtheirwinningoflucrative,publiclysubsidizedconstructioncontracts.

WhilenotGulf-based,itisworthmentioningthattheEgyptiandevelopmentfirmOrascomProjectsforTouristic

Developmentalsogotinontheaction.

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colonization,infact,thatextendsintothedomainofcriticalinfrastructureaswell.Nowherewas

thismoreobviouslyevincedthanintheredevelopmentofAqaba’sPort.

TrulyoneofthemoresordidaffairsinASEZA’sratherignominioushistory399,thecontract

forthismassiveprojectwoundupbeingawardedtoAbuDhabi’sstate-ownedAl-Maabar

InternationalInvestments400onthebasisofaBuild-Operate-Transfercontract.Havingwonthis

contractthrougharatheropaqueandnon-competitiveprocess—andhavingpaidtheADCamere

$500millionfortheportaswellas3200dunamofsurroundingland,afeegrosslybelow

estimatedmarketvalue401—,theBOTcontractsignedbytheADCandal-Maabarmeantthatfor

alleffectsandpurposes,aprivatelymanagedfirmcloselyalignedtothealNahyanfamilywasto

beownerhenceforthofoneofJordan’smostessentialpiecesofinfrastructure.Problematicasthis

alreadywas,inadditiontosellingthispublicassettoal-Maabaratasteepdiscount,ASEZA/ADC

alsoagreedtosubsidizetheredevelopmentprojectinanumberofdifferentways.Beyond

investing$200millionofpublicfundingintotheredevelopmentprojectwithoutsecuringa

commensurateequityshareintheport,subsidizationalsosawthelocalauthoritiesagreeto

compensateal-Maabarfordelaysandworkinterruptionstothetuneof$548,000aday.402Given

theextentoftowhichtheredevelopmentwasultimatelydelayed—muchofwhichfollowedafter

399 Asofyear2013,fiftydifferentaccusationsand/orlegalchargesofcorruptionhadbeenfiledagainstASEZA.See:

PascalDebruyneandChristopherParker,“Reassemblingthepolitical:placingcontentiouspoliticsinJordan”inContentiousPoliticsintheMiddleEast.PalgraveMacmillan(2015),p.450.

400 Al-MaabarhassincebeenboughtoutbytheDubai-basedEagleHillsLLC.401 ThesalewasjustifiedbyreferencetoJordan’sneedtomakepaymentsonitsdebtstotheParisClub,whichwere

comingduein2009.402 DebruyneandParker(2015),p.450.

194

dockworkerslaunchedaprotestinresponsetoal-Maabarevictingthemfromtheirhomesnear

thePort403—,thesecompensatorypaymentsentailedanothersignificanttransferofpublic

wealthintoprivate(andforeign)hands.404

TransformingtheinfrastructureandbuiltenvironmentofAqabaasmuchasitdidthelogic

ofcapitalaccumulationinthecountrywritlarge,ASEZA’sgovernance,liketheECC’sbeforeit,

endowscontemporaryJordaniancapitalismwithmanyofitsmostenduringfeatures.

(3)TheMunicipalityofGreaterAmman,theAmmanInstitute,andtheUrbanRenewaloftheJordanianCapital

Beforeclosingonthepoliticalinstitutionalizationofneoliberalcapitalismin

contemporaryJordan,IwillturntoexaminehowMayorOmarMa’ani—workinginpartnership

withanothermanagementconsultant-staffedinstitutioncalledtheAmmanInstitute(Ai)—co-

optedandtransformedthegovernmentoftheMunicipalityofGreaterAmman(GAM)soto

restructurenotonlyAmman’sphysicalspacebutalsothemodalityofcapitalaccumulationthat

definedandsustainedit.Furtherdeepeningthenationaleconomy’sdependenceupon

investmentsinspeculativenon-tradables(especiallyrealestate)andprecipitatinganupward

(andoutward)redistributionofwealthaswell,Ma’ani’stenureasMayorwouldrepresentan

extensionofthesameautocratic-technocraticgovernancethathaspervadedallpolicymaking

403 Underal-Maabar’sdirection,theredevelopmentoftheAqabaportwouldrequirethemassdisplacementofport

workersandthewidererasureoftworesidentialneighborhoods:ShalahlahandShmisani(DeBruyne,191,196).Thesedisplacements,whichhadalreadypartiallybegununderalMaabar’sMarsaZayedproject,eventuallyprecipitatedoneofthelargestpre-ArabUprisingsprotestmovements.DespitetheimpacttheseprotestswouldhaveontheJordanianspring,however,theywerenotsuccessfulinreversingthedisplacements.

404 Inadditiontoal-Maabar,aSwedishfirmlaterwonthecontractforthemanagementoftheport(DeBruyne,185).

195

acrossthereignofKingAbdullah.YetagainexhibitingtherotatthecoreofJordanianpolitics,this

thirdcasestudycanhelpvalidatemanyofmyearlierclaimsonthepoliticalinstitutionalizationof

thecontemporarySSAwhilealsofurtherunveilingthepoliticaloriginsoflowgrowth,crisis-

orientedcapitalismontheeastbanktoo.405

OmarMa’aniwasappointedtohispostasMayorfollowingtheaforementionedJordan

Gatedisasterof2006.406Evincingthecontinuitiesandcommonalitiesbindingeachinstancein

thewiderpoliticalinstitutionalizationofcontemporaryJordaniancapitalism,Ma’aniwould

subsequentlyusemanyofthesameautocratic-technocraticmaneuversaswerepracticedbythe

405 Aswillbecomeclear,Ma’ani’sgovernanceyieldedmajorsocialdislocationatthesametimeasitfurther

consolidatedthedevelopmentallyspuriousinvestmentstrategiesfirstintroducedbytheECCandASEZA,therebycontributingtotheentrenchmentofcrisisconditionsandstagnation.

406 JordanGatewasa“twintower”developmentprojectprimarilyfinancedbyKuwaiticapital.ImplementedasaPPP

calledtheUrbanDevelopmentProject,thetowerswerebuiltonpubliclandpreviouslydesignatedasarecreationalpark.Followingamassivefirein2006,thewiderurbanrenewalprojectthenunderwaycameinforinquisition,andmuchoftheleadershipoftheMunicipalityofGreaterAmman,includingtheMayorNidalHadid,weredismissed.

Formoreonthisdebacle,see:ElianaAbu-Hamdi,“TheJordanGateTowersofAmman:SurrenderingPublicSpace

toBuildaNeoliberalRuin”,InternationalJournalofIslamicArchitecture(5:1),2016,pp.73-101.

UrbanRenewalinAmman Thetopicofurbanrevitalizationwasahotoneinmanydevelopmentcirclesduringthefirstdecadeofthe2000s.ThiswasallthemoresoinAmman,wheretheJordanGatedisasterof2006hadinvestedrenewalwithawholenewkindofpoliticalsalience.GentrificationcumurbanrenewalhadkeyroyalsponsorsinthepersonsofQueenRaniaandKingAbdullah,thebackingofthedevelopmentcommunity(fromUSAidtoJapan’sInternationalCooperationAgency),andsignificantappealtoGulfinvestorsstillflushwithearningsfromthepre-financialcrisisoilboom.InthepersonofOmarMa’ani—whoserisetothemayorshiphadbeensecuredthroughRania’sinterventions—italsohaditspolicydirector.

196

ECCandASEZA—andemploymanyofthesamepersonnel—asheswiftlymovedtocarryouthis

desiredtransformationoftheAmmanicityscape/socialecology.

InkeepingwiththeautocratictendenciesthathavebeenbasictoAbdullah-era

governance,theearlydaysofMaani’smayoralcareergavewitnesstoanumberofefforts

designedtoinstitutionallyinsulatetheMayor’sofficefromboththewidermunicipalbureaucracy

andfromthepublic.Simultaneoustothis,thisinitialperiodalsosawtheMayorandhisclose

alliesattempttoretrofitAmman’smunicipalgovernmentforthemoderneraaswell.This

retrofittingmostlyconsistedofeffortstocullanallegedlybloatedbureaucracysotomakeit

appropriatelylean,efficient,andadaptable.407

LesttherewasanyambiguityonthenewMayor’sideologicalmoresincarryingoutthis

culling,itsaccompanimentbyceaselessideologicalattacksmeanttoinvestthebureaucracywith

ontologicalcorruptionaswellastribalistandtraditionalisttendencieswouldbringMa’anietal.’s

neoliberalaffinitiesintoratherstarkrelief.408HavingmadeenemiesofhisJordanianemployees

throughtheseactions,Ma’ani,likehiscounterpartsatASEZA,wouldinturncometorelyupon

407 Thiscullingcontainedanumberofabsurdities,themostobviousofwhichwasthatitwashighlypaidforeign

consultantslikeGerryPostandtheWatsonandWhiteCompanywhowerefrequentlyenlistedinmakingtheseaccusationsofbloatedness.GiventhatPostwaspersonallyacceptingamonthlyfeeofJD20,000forhisservicesandthattheWatsonandWhiteCompanycommandedasimilarlysignificantretainer,theirarticulationofnecessitarianargumentsinfavoroffiscalconsolidationandmasslay-offswasmorethanabitrich.

FormoreonMa’ani’sreorganizationofGAM,seeDeBruyne(2013),pp.239-241. OnMa’ani’smoregeneraltransformation(andprivatization)ofgovernance,see:ChristopherParker,“Tunnel-

bypassesandminaretsofcapitalism:Ammanasneoliberalassemblage”,PoliticalGeography(28),2009,p.116-117.

408 Ontheseideologicalattacksontribes(andontheparticularutilityoftheanti-tribalism/traditionalismcharge),

see:ElianaAbu-Hamdi,“BureaucraticizingtheCity:ModeratedTribalism,RegimeSecurity,andUrbanTransformationinAmman,Jordan”,TraditionalDwellingsandSettlementsReview(27:2),2016,pp.23-37.

197

uponabraintrustcomprisedofUSAidtechnocrats409andtrustedforeignmanagement

consultantsacrosshistenureasMayor.410

Theseforeignalliesweretypicallyhousedatanewlyformed“thinkanddotank”calledthe

AmmanInstitute(Ai).FunctioninginamannersimilartotheAqabaDevelopmentCorporation,Ai

wasenlistedbyMa’aniasadefactoplanningbody—anautonomous,unelected,foreign-staffed

organizationunilaterallyempoweredbytheMayorsotodesignthemassiveurbanrenewal

projectsthatwouldsubsequentlythesocialandeconomicfoundationsofJordan’scapitalcity.

PersonallystewardedbyGerryPost411—whocollectedamonthlysalaryofJD20,000forhis

troubles—,Ai’splanningwouldquicklyevincethesameclass-biasandrecklessnessaswasseen

withtheADCinAqaba.IncombinationwithMa’ani’sautocraticgovernance,thiswouldbe

sufficienttoensurethatAmman’surbanrenewalgeneratedprofoundlevelsofsocialdislocation,

gentrification,andcapitalistrentseeking.412

409 TheWatsonandWhiteCompany,oneoftheconsultanciesbroughtintotoadviseMa’anionthisculling,madethe

caseformasslay-offsbyassertingthatGAM’sbureaucracyneededto“goonadiet”(ParkerandDeBruyne,2015,p.442).

410 USAid’sSABEQprogram—SustainableAchievementofBusinessExpansionandQuality—,footedthebillfor

manyoftheseforeignconsultants,allowingMa’anitobringinGerryPost’sBearingPointInc.aswellastheWatsonandWhiteCompany.

411 Post’sAihadafewJordanianstaffamongstitsnumber,includingTamamMango.Heirtoaquotacoteriemyself,

Mango,wholaterreceivedhisPhDatUNI,representsthekindofcompradorconsultantthatisnotuncommoninJordan’sdevelopmentspaces.AfterservingasoneofPost’schieflieutenants,MangowouldmoveovertotheCrownPrinceFoundation,whereheiscurrentlyemployedasCEO.

412 Foranexcellentreviewofthisgeneralphenomenon,see:NajibHourani,“NeoliberalurbanismandtheArab

uprisings:aviewfromAmman”,JournalofUrbanAffairs(36:S2),2014,pp.650-662.

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Proceedingsequentially,byconsequenceoftheMayor’sweaponizationoftakseemrelated

provisionswithintheMunicipalityofGreaterAmman’sLawofExpropriation413—aswellashis

unilateralrewritingofzoninglawsandapolicyofevictinglong-termthoughnon-permitted

housingcommunities414—,renewalexpelledthousandsoflowerclasspeoplefromthehomesand

neighborhoodsthathadanchoredtheirfamiliesacrossgenerations.Throughthesemeans,the

SanaayaAmman415developmentprojectalonedisplacedroughly5,000peoplelowerincome

peoplefromtheQaisiyyaneighborhood.416Inmakingspaceforthecity’smassivenewAbdali

constructionproject,thepeopleoftheneighboringalZa’amtaneighborhoodweresimilarly

removedbytheunilateraldecreesofMa’ani’smayoraloffice.417

413 ThisTakseemsystemwasusedininstancesofmulti-ownershipproperties(i.e.propertiesinheritedbymorethan

onefamilymember).Facilitatingnewdevelopments,iteffectivelyallowedforthedissolutionofexistingpropertyclaimsundertheauspicesthattheGAM’swouldsubsequentlyprovideanequivalentpropertyinadifferentarea(Debruyne2013,p.312)

414 Inotherwords,thesewerecommunitiesthathadbuiltpermanenthomesinthe1960sand1970swithout

establishingproperlegaltenureovertheland.SeeDebruyne(2013),p.260,fordetails.415 TheSanaayaAmmanproject—aluxurytowerconstructionprojectfinancedbyLimitless,aDubai-basedfirm—

wasactuallypostponedpost-thedisplacementofthesepeopleafterfinancesdriedupin2009.ItisbasedintheAbdunneighborhoodofAmman.

416 ThemajorityoftheevictedwereHebroniterefugees(orthedescendantsofrefugees)ofalnaksa.Lacking

appropriatelandandpropertytitles,fewamongstthiscommunityhasreceivedanycompensationfromGAM;forthosethatdid,moreover,theratewassetbasedonlandvaluationsfromthe1960s.Throughthesecynicallegalmanipulations,Ma’ani’sgovernmentwasabletoseizetheirlandatone-sixthtoone-eighthitsmarketprice(Debruyne,2013,p.312).

417 AlsocontributingtothismakingofspacewastheMayor’soffice’sredrawingofAmman’spublictransportation

infrastructure.Routesandhubs(includingtheAbdalistation)weresimplyrelocatedwithoutanyregardforthosetobeeffected.

PriortotheNewAbdaliproject,Abdalihadbeenhometooneofthelargestlow-incomemarketsandthecentralbusingnodeofWestAmman.Havingratherfarcicallychargedthatthemarketwasthedistributionalnexusfordrugtraffickers,Ma’anietalunilaterallycloseditwhilerelocatingthebusterminaltoTarbarbour,aneighborhoodintheremotenorth-eastofthecity.

Formoreonthis,see:DorisSummer,“Theneoliberalizationofurbanspace”,VillesetTerrirtoiresduMoyen-Orient(2006)

NajibHourani,“UrbanismandNeoliberalorder:thedevelopmentandredevelopmentofAmman,”JournalofUrbanAffairs(26:S2),pp.634-649

199

Ifexpulsionsofthesesortsexpeditedgentrificationeffortsthroughclearingtheland,the

renewalinitiativessubsequentlyimplemented(includingtheaforementionedSanaayaAmman

andnewAbdaliprojects)finishedthejob.Constructingmonumentstoluxuryconsumerismatop

thegraveyardsoflowerclasscommunities,chicapartments,hotels,officebuildings,shopping

malls,andhigh-endrestaurantshavebeenerectedwhereintergenerationalcommunitiesonce

madetheirhomes.LikewasseeninthetransformationofAqaba’sbuiltenvironment,then,each

ofthedevelopmentprojectsintroducedinAmmanimpliedanexplicitservicingoftherichas

muchasanerasureofthepoor;eachproject,inotherwords,evincedtheabidinglogicof

accumulationthroughdispossession.418Thiswassoevenwheninitialprojectplansmayhave

includedsomeprovisionsfordevelopmentally-oriented,publicly-mindedinvestment.For

instance,theoriginalproposalfortheaforementionedredevelopmentofnewAbdalihad

envisionedamultiuseurbandistrictcontainingmedicalfacilities,ITfirms,aKingHussein

MemorialLibrary,andacampusforanewAmericanUniversityofJordan.Astheyearspassedand

thescaffoldingwentup,however,whatendedupbeingconstructedwasashinynewfinancial

sectormoonlightingasahubforbourgeoisrecreation.

Asfortheparticularsofthecapitalistrent/profitseekingthatisattheheartofthisall,to

theextentthatMa’ani’surbanrenewalwasguidedbythesameforeignmanagementconsultants

ashadpresidedoverFakhouri’seffortsinAqaba,itshouldbenoshocktothereaderthatthe

418 ItisworthnotingthatoneofMa’anietal.’sgentrificationplansdidfail.Specifically,aspartofplanstorenewthe

olddowntownofAmman,theMayor’sofficeattemptedtoabolishrentcontrolssotopriceouttheoldsouqmerchantsthathadpopulatedthestorefrontsoftheareaforgenerationsUltimately,theresistanceofoldsouqmerchantsandtheremarkable,cross-classmobilizationthatroseuparoundthemwaspartiallysuccessfulinreversingMa’aniandAi’srent-controlpolicies.See:ParkerandDebruyne(2015),pp.442-445.

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samemixof(transnational)regimeclientsandpatronswhowereprivilegedonJordan’ssouthern

coastwerealsoprivilegedduringAmman’sreconstruction.IntheNewAbdaliredevelopment,for

instance,theMayoretalmadecertainthatGulfcapital,domesticfinancialcapital,andthe

emergentinstitutionsofmilitaryentrepreneurialism—institutionsthatalsoenrichedthemselves

inAqaba—eachsecuredahealthyreturnoninvestment.419Inorganizingapublic-private

partnershipchargedwithbuilding“affordablehousing”onthecapital’speriphery,Ma’aniandAi

laterallowedaDubai-basedJordanianbusinessmanwithclosetiestotheroyalfamily(Khalidal-

Wazani)toembezzlemillionsofdinarfromthepubliccoffersaswell.420Andinmoregenerally

419 Firstlyandofgreatimportance,NewAbdaliwastobe(largely)builtonaformermilitarybarracks.Byvirtueof

thisfact,thesameMawaredthathadmanagedtoinsinuateitselfintomanyofAqaba’srealestatedealingsfounditselfperfectlypositionedtoextractrentsfromAmman’sreconstructionaswell.LeveragingitsnominalownershipofthesepubliclandsanditsfiftypercentshareinanewlyestablishedAbdaliInvestmentandDevelopmentCorporation—aprivatesharingholdingcompanycreatedbyMawaredsotodirecttheconstructioneffort—,thisentrepreneurialwingofthemilitary,onwhoseboardMayorOmarMa’aniandKingAbdullahjustsohappenedtosit,mayhaveevenmadeoutbetterinAmmanthanitdidinAqaba(ParkerandDeBruyne,444).Whatismore,justasSaudiOgerhadbeenoneofMawared’schiefpartnersintheconstructionracketdownsouth,heretooweretheyjoinedbyalocalsubsidiaryofthatfirm,OgerJordan.WithArabBankagainintow(securingashareforJordanianfinance)aswellandwiththeUnitedRealEstateCompany,aninvestmentarmoftheKuwaitProjectsCompany,alsoacquiringaminoritystakeintheAbdaliInvestmentandDevelopmentCorporation,onemightsaythewholebandwasbacktogether.WhenitcametoGulfpetrodollarrecyclingandeliterentdistribution,then,AbdaliwaseverybitthematchforAqaba.

Seewww.abdali.joformoreinformationontheAbdaliInvestmentandDevelopmentCorporation.420 Specifically,thispublic-privatepartnershipwascontractedtoconstruct15,000unitsofaffordablehousinginal-

Jiza,anemergent“ruralghetto”locatedneartheQueenAliaAirport.PPPpublichousingprojectsmoregenerallybeganfollowingthelaunchoftheRoyalInitiativeforDecentHousingin2011.Withinthisparticularpartnership,Khalidal-Wazani’sTaamerJordanHoldingshadbeenpairedwiththeHousingUrbanDevelopmentCompany,anentitycreatedin1992andhenceforthassignedprimaryresponsibilityforhandlingandfinancingthegovernment’ssocialhousingpolicies.ThelongandshortofthePPPwasthatKhalidal-Wazaniillicitlypocketedsuchmassiveamountsofthepublicmoneythathadbeenallottedfortheconstructionofhousesthatstateprosecutorswereforcedtoopenacaseagainsthim(Debruyne,p.293).

Asal-Wazaniwasalong-timeadvisertotheRoyalCourt,amanwithcloserelationstotheUAE’sroyals—heis

currentlythe“StrategyandKnowledgeAdvisor”atheMohammadbinRashidalMaktoumKnowledgeFoundation—,theformerCEOoftheSarayaAqabaRealEstateCompany,andthecurrentChairmanofArabBank-Syria,hispersonencapsulatesthenatureandconsequenceofGenerationAbdullah’stechnocraticautocracybetterthananyother.

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ensuringtheopacityofprocurementprocesses,providingpublicsubsidiesfortheconstruction

firmsbuildingthecity’snewskyline421,andguaranteeingcapital’swideraccesstocheapforeign

labor,thisleadershipmadecertainthatthewiderrealestate-facingbusinessclimatewasas

conducivetoeliteprofitseekingaspossible.

…….………..……........…………….…………….………..….……………………………………………………………………………

Therampantcorruption(andtheformofcapitalaccumulation)thatwasoverseenby

Ma’aniandAidideventuallycometoaratherignominiousend.ThespotlightoftheArab

uprisingsilluminatedmanyofthispolicyteam’smoregratuitousdepravities;byconsequence,

OmarMa’aniwoundupbrieflyarrestedandGerryPostwaseventuallysentpacking.

ItshouldneverthelesscomeaslittlesurprisethatMa’ani’sfallfromgraceasMayorwould

notimplyasubstantivechangetothelargerprocessesofpowerandaccumulationthathehad

previouslystewarded—whetherinAmmanornationally.ReplacinghimasMayor,afterall,was

anotherdutifulsubjectofGenerationAbdullah,AqelBiltaji,whowasservingasChief

CommissionerofASEZAatthetimeofhisnewappointment.UnderBiltaji,collaborative

predationinspeculativenon-tradableswastoremainthemodusoperandiofgovernance,andthe

Insomeways,thisaffordablehousinginitiativerepresentedtheback-endofagentrificationprojectthathad

begunwiththekindsofdisplacementsIdescribedinQaisiyyaandZa’amta.Havingalreadyprofitedoffthedevelopmentsthatwerebuiltwherethosecommunitiesoncelived,thesameconstructionfirmswouldthenprofitagainthroughbuildingthenewaffordablehousingunitsthatthosedispossessedcommunitieswouldnowbeforcedtoliveinoutontheperipheryofthecapital

421 Profitswerestate-subsidizedthroughextensivetaxbreaks,throughtheGAMfinancingmuchofthe

infrastructure(androadconstructioninparticular)thatwouldlinknewAbdalitotherestofAmmanandthroughtheSocialSecurityCorporationconsistentlyprovidingtheAbdaliInvestmentandDevelopmentCorporationwithcriticalinjectionsofcapitalwhenevertherewereshortfallsinliquidity.SeeDeBruynepp.246-256,321.

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publicwastocontinuetosubsidizeeliteprofitsthroughanumberofdifferentmechanisms,asI

willdiscussatlengthinthenextchapter.

EvenforMa’ani,thedarkdaysprovedgratefullyfleeting.Afterbutafewyearsonthe

backfoot,hewouldexperienceLazarus-stylerebirth,arebirthconsummatedupontheformer

Mayor’sappointmenttotheSenateandtotheboardoftheCrownPrinceFoundationin2016.His

politicalrehabilitationsuggeststhehalflifeoftheneoliberalpolicymakerinJordanmayprove

longindeed—regardlessofthewreckagetheyleavebehind.AndshouldthegriftofAbdullah’s

economizedpoliticaleliteneedanyfurtherevidence,itisworthnotingthattheMa’anihasbeen

allowedtoretainhispostasCEOofMaaniVenturesthroughouthistenureasSenator—andthat

Ma’aniVentureshasmanagedtoconsistentlyprocurelucrativepublicinfrastructurecontracts.422

Conclusion

Operatingthroughaseriesofinsulatedandautonomouspolicymakinginstitutions—

institutionsthatallowedAbdullahetaltobypassthedemos,theparliament,andthetraditional

machineryofthestate—,theKing’seconomizedpoliticalelitewereabletorestructureeachand

everypillarofthenationaleconomy,fromtradeandinvestmentpolicytotaxandindustrial

policy.AstheexamplesofASEZAandMa’ani’sGAMevince,thiselitewasalsoableto

embourgeoiseJordan’sphysicalspacesthroughgentrifyingurbanrenewalprojects.Inthusly

rewiringthecircuitsofcapitalaccumulation,transnationalizingthecapitalistclass,and

422 Formoreonhisbusinessdealings,see:www.maani.com

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deepeningtheJordanianeconomy’sdependenceonthebuiltenvironment,theautocratic-

technocraticgovernancedetailedinthischapterverymuchinstitutedthearchitectureofthe

country’scontemporarycapitalism.

Ifmyanalysiswassuccessfulinestablishingtheveracityoftheclaimsarticulatedabove,I

hopeithasbeensuccessfulinconveyingtwofurtherpointstothereaderaswell.First,by

deconstructingthepropertiesandoutputsofthecountry’sautocratic-technocraticmodalityof

governance,itismyhopethatmyanalysishasalsoaffordedinsightsintothedualisticnatureofa

socialstructureofaccumulationthatisatoncecrisisproducingandcrisisstabilizing.Ontheone

hand,Ihaveshownthatthismodalityofgovernance—aswellastheinsulationofaneconomized

politicalelite—functionstoexpediteandstreamlineaveryparticularrestructuringofthe

economy.Asthisrestructuringdeliversprofitsandrentstoaconstellationofinfluential

transnationalallies,itsimultaneouslystakessuchhighleverageindividualsandinstitutionsinthe

survivaloftheJordanianpoliticaleconomy.Inviewofthematerialresources(financiallyor

otherwise)thatareatthedisposaloftheseindividualsandinstitutions,Iwouldcontendthatthe

distributiveeffectsyieldedbythisgovernancecannothelpbuttostabilizeJordaniancapitalism.

Andyet,Ihaveshownthatthesamedistributiveeffectsinevitablyexertacountervailing

effectaswell.Thecostsofgeneratingandallocatingprofitsinthismanner—ofstabillizing

capitalisminthismanner—,are,afterall,significant.Tobegin,theelite-accruingsystemof

accumulationthroughdispossessionthatisinstitutionalizedthroughthismodalityofgovernance

implieslowaggregategrowth,exploitation,andconsistentsocialdislocation.Byarticulatingthe

preconditionsofunresttothisextent,suchgovernancenecessarilyincreasestheprobabilityof

disruptionandanti-systemmobilization.Theseprobabilitiesareonlyincreased,moreover,bythe

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processeffectsofthismodalityofgovernance.Whileautocratic-technocraticdecision-makingmay

beconducivetofastpolicychange,itisprofoundlyalienatingaswell.Byempoweringnon-

nationalswhilemarginalizinganddeactivatingthedemosandthestatebureaucracyalike,infact,

thisisaprocessboundtoengendersubstantivelevelsofdisaffectionandangeramongsta

numberofcriticalsocialforces.Asthesameinput—autocratic-technocraticgovernance—can

therebybedemonstratedtobedrivingandcontainingcrisis,Ihopethischaptermayhave

renderedtheparadoxofJordan’scapitalismalittlelessparadoxical.

Second,bytracinghowthepoliticalpervadeseverythingfromintracapitalrelationsand

theformofmarketcompetitiontosocialcontrolandtheexternalarticulationoftheJordanian

economy,itismyhopethattheco-constitutive,interpenetrating,andintegratednatureof

Jordan’sneoliberalsocialstructureofaccumulationhasalsocomebetterintofocus.AsIturnto

chaptersevenandanexaminationofthestate/palaceroleinthecontemporaryeconomy,Iintend

todrivethispointhomeevenfurther.

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CHAPTERSEVEN

Themakingandmanagementofthemarket:Thestate/palaceintheeconomy

Thischapterwilltracehowthestate’sroleintheeconomyhasshiftedsincethepassingof

KingHussein.Inthepagesthatfollow,IwilldemonstratethatAbdullah’sneoliberalguidancehas

notorchestratedthewithdrawalofthestatefromtheeconomy,butrather,aseriesofchangesto

howthebenefitsgeneratedbystateinterventionaredistributed.Havingdetailedhowsaid

benefitsnowaccrueintofewer(andoftennon-Jordanian)handsthanwaspreviouslythecase—

andhavingexplainedhowthestate’smixofmarketmakingandmarketmeddlingexpedites

short-term,developmentallyspuriousformsofprofitseeking—,therelationbetween

contemporarystateinterventionismandJordan’scapitalismofcrisiswillbeeasilydiscerned.

Iwillbreakthisanalysisintotwosubsections.ThefirstwillfocusinonwhatIpreviously

conceptualizedasthestate’smass-orientedinterventions.Herein,Iwillforegroundtherolethat

(retreating)welfarismhaveplayedinstabilizingcapitalaccumulation(andindestabilizing

middleandworkingclasslife)duringthetenureofAbdullah.423Withinthiswiderlineofwelfarist

inquiry,Iwillalsotakeheedtoemphasizethegenerationaleffectsthatrelativedeclinesinpublic

423 Specifically,Iwillconsiderthesocialandeconomiceffectsgeneratedthroughpublichealthexpenditures,the

cancelationofuniversalsubsidies,andthestate’sprivilegingoftargetedtransfersinitspovertyalleviationoperations.Inaddition,Iwillexaminehowamoregeneralizabledeclineinthequalityofpublicserviceprovisionshasstressedmiddleandlowerclassfamilies—forcingthemtoborrowandspendgreatersumsonhealthandeducation—,andhowthesestressorsrelatetosocialinstability.

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sectorhiringhavehadoverthelasttwentyyears—evincingtheextenttowhichthesocialimpact

ofdirectstateemploymenthasdeclinedunderthecurrentKing.424

ThesecondsubsectionwillnarrowinonwhatIpreviouslyconceptualizedasthestate’s

elite-orientedinterventions.Herein,Iwillbeginwithananalysisofthefiscalsociologythathas

beenconsolidatedunderAbdullah’swatch.Attheaggregatelevel,Iwillshowthissociologytobe

class-biasedandhighlypolarized.425Henceforth,Iwillproceedtoconsidersixadditional

mechanismsofelite-orientedintervention:(1)privatization;(2)themanipulationofcurrent

accountliberalization;(3)theinstrumentalizationofpubliccreditinstitutionsforthepurposesof

boostingelite-ownedenterprises;(4)real-estateorientedindustrial/investmentpolicies426;(5)

laissez-faireindustrialpolicies[asimplementedacrossJordan’sQualifyingIndustrialZones(QIZ),

SpecialEconomicZones(SEZ),andSpecialDevelopmentZones(SDZ)];and(6)militaryindustrial

policies.427

424 Inaddition,Iwillalsoshowthatpublicsectorhiringtodayremainsdetachedfromconsiderationsofmerit;this

beingthecase,IwillalsodocumenttheextenttowhichthisareaofpublicexpendituresiscompromisedbymuchthesameissuesaswereseenduringHussein’spost-1973years.

425 Bypolarizing,Iprimarilymeanthatthisfiscalsociologyfunctionstodeliverupwardandoutwardredistributionsofwealthatthesametimeasitpunisheslowerandmiddleclassfamilies.IwillestablishthisclaimthroughexaminingthedistributiveeffectsintroducedbytheVAT,theregime’sdefactoneglectofcorporateandincometax,thetaxbreaksprovidedacrossJordan’smanyspecialeconomicanddevelopmentzones,thepervasivenessoftaxevasion,andtheissuingofdomesticbondstolicensedcommercialbanksalone.

426 LikethosethatwereintroducedinAqabaandAmman(aswasdiscussedinthepreviouschapter).427 Herein,IwillscrutinizeMawared—theorganizationintroducedinmydiscussionsofASEZAandtheGAM—as

wellastheKingAbdullahIIDesignandDevelopmentBureau(KADDB).

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Mass-OrientedStateInterventions:Employment,Health,SocialWelfare

AswasthecaseunderKingHussein,KingAbdullah’smass-orientedinterventionsinthe

economystartswithpublicemployment.Fromcivilserviceandmilitaryhiringatthenational

leveltothestaffingofmunicipalgovernmentsatthelocallevel,thestate’sdirectjobcreation

continuestosecurealevelofbasicwelfareforhundredsofthousandsofJordanianfamiliesifno

longeraffordingsuchfamilieswiththemiddleclasscomfortsthatitoncedid.428Throughsuch

means,Abdullahhaskeptthepercentageofpublicemploymenttototalemploymentrelatively

steady(andrelativelyhigh).Inmomentsofpoliticalcrisis,moreover,Abdullah,likehisfather

beforehim,hastendedtoincreasethispercentageinhopesofamelioratingpublicgrievance.

Spikesinthepercentageofpublicemploymenttototalemploymentcoincidingwiththeglobal

financialcrisisof2007-2009andtheArabUprisingsof2011givetestamenttosuchcontinuities.

428 Publicemploymentcanalsobeusedtoserviceeliteclients.Forinstance,thePalaceusesappointmentstothe

Senate/seniorministerialpositions,jobsattheRoyalCourtorwiththeRoyalNGOs;andpositionswithnominallyautonomous,palace-alignedinstitutionssuchasMawared,theKADDB,ASEZA,theSocialSecurityCorporation,andtheJordanianInvestmentCommissiontolookafterthepoliticallyconnectedelite.

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Hussein’sNeopatrimonialism Aswasdetailedinchapterthree,theembeddedneopatrimonialismestablishedbyHusseinhadrequiredandexpandedtheapparatusofthestatesotoassureawidedistributionofrentsandservices.Particularlyinthepost-1973context,Idelineatedthatdespiteunderminingthelong-termdevelopmentoftheeconomythroughtheinefficienciesandconsumption-orientedbiasofhisinterventions,Hussein’spoliciesweresociallysuccessfulinthattheyinsuredawidedistributionofpatronage.ThrougharegimeofuniversalconsumersubsidiesandpricefixingoverseenbytheMinistryofSupply,throughthesubsidizationofindustrialinputs,throughacivilserviceandmilitarythatsecuredthewelfareofhundredsofthousandsofTransjordanians,throughtheinstrumentalizationofnominallyindependent,state-ownedcreditinstitutionsandpensioninvestmentfunds,andthroughaseriesoflabormigrationarrangementsthatsecuredlivelihoodsandprosperityforhundredsofthousandsofethnicPalestinianswhohadtoalargeextentbeenlockedoutofthebureaucracy,Hussein’sneopatrimonialismconsolidatedarobustifdependentmiddleclass. Thisneopatrimonialismwouldeventuallycomeundonebythetotaldisarticulationofconsumptionfromproductivity—anoutcomethatwasitselfafunctionofanemergentformofrentierismthatsawthestate-businesspartnershipbiastheeconomytowardsimports,consumption,services,andcommerce-basedarbitrage—,butitsdistributivestrategywasnonethelesseffectiveinstabilizingthelargerpoliticaleconomyforaperiodofapproximatelytentofifteenyears.

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ShareofPublicSectorinTotalEmploymentUnderKingAbdullah(Ages15+)

DataprovidedbytheDepartmentofStatistics.

GraphprovidedbyRaguiAssadandColetteSalemi,TheStructureofEmploymentandJobCreationinJordan:2010-2016,p.25

DataprovidedJordan’sDepartmentofStatistics

Acouplepointsareworthnotingasregardsthegraphsonthepreviouspage,however.

First,whilealongitudinalcomparisonofpublicemploymenttototalemploymentratiossuggests

anequivalencebetweentheera’sofAdullahandHussein,suchasuggestionwouldbemisleading.

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ThisisbecauseAbdullah-eraratiosareinflatedbyrelativelysmallerdenominators(i.e.bythe

modernperiod’scomparativelysmallertotalemploymenttoworkingagepopulationratios).In

otherwords,Abdullah-eraratiosofpublicemploymenttototalemploymentarejuicedbya

generalizeddeclineinemploymentwritlarge(andinlaborforceparticipationmoregenerally).If

oneweretoaccountforthisandtakeamorereflectivemeasureasthebasisforalongitudinal

comparison—say,publicemploymenttototalpopulationratios,orannualpublicsectorjobs

createdv.jobseekers—,itwouldbecomeclearthattherelativesocialweightofpublic

employmenthasactuallyrecededconsiderablyundertheruleofthecurrentmonarch.Tothe

extentthatpublicemploymentisnowsecuringalesserproportionofJordanianfamiliesagainst

thewhimsofthe(failing)labormarket,then,onewouldneedtoacknowledgethatthe

effectivenessofthisaspectofthestate’smass-orientedeconomicinterventionshas

depreciated.429

Thisdepreciationisperhapsmoreeasilydiscernedthroughanexaminationofthe

Jordaniancivilservice’srecruitmentandhiringnumbersduringAbdullah’stenure.430Between

429 Ifthesocialrelevanceofpublicemploymenthasclearlybeendiminishedunderthecurrentregime,itisworth

notingthatthedevelopmentalimpactofpublicemploymenthasalsobeenfairlymarginal.ThismarginalityisafunctionofthefactthatAbdullah’spublicsectorhiringhasalwaysbeenconductedwithoutconsiderationofmerit(ascollegegraduates’hiringratesmayhavesuggested).Bloated,inefficient,andcontributingverylittleintermsofdevelopmentplanning,industrialplanning,andadministration,thepublicsector’seconomicutilitythereforecontinuestoreducetothecontributionsthatitmakestolowerandmiddleclassconsumption.Thisallbeingthecase,oneshouldbecarefulnottooverstatetheeffectthatthisaspectofthestate’sinterventionismhashadonthestabilizationofcontemporarycapitalaccumulation.

See:BenedicteCoestier,“JordanandtheMiddle-IncomeGrowthTrap:ArabSpringsandInstitutionalChanges”,

WorkingPaper:UniversiteParisOuest,NanterreLaDefense(2015),p.12.430 Thenumberofpeopleapplyingforjobswiththecivilservicefirstspikedwiththefirstreturnmigrationof

JordaniansfromtheGulfin1990-1991.Thatsaid,theapplicantpoolhastrulyexplodedduringAbdullah’stenure.

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2014and2018,thecivilserviceneveroncereceivedlessthan300,000annualapplications.

Acrossthosesameyears,thecivilserviceneveroncehiredmorethan10,332applicantsina

singleyear.431Ifjobprospectsforanyapplicanttothecivilservicearethereforehighlydubious,it

isworthnotingthattheoddsfacingacollegegraduateareevenlonger.Whiletheaggregate

appointmentperapplicantratehoversbetween2-3%dependingontheyear,theappointment

perapplicantrateforcollegegraduatesrestsbetween1.3-2.2%forthe2014-2018period.432

431 Duringoneoftheyearsunderquestion,ithiredamere7,772.432 ThisisinstarkcontrasttothetrendsthatprevailedunderHussein.Inthoseyears,collegegraduateswere

virtuallyguaranteedapermanent,wellcompensatedjobinthepublicsector. See:KarenPfeifer,“SocialStructureofAccumulationTheoryfortheArabWorld:TheEconomiesofEgypt,Jordan,

andKuwaitintheRegionalSystem”inTerrenceMcDonough,MichaelReich,andDavidKotz(eds.)ContemporaryCapitalismanditsCrises:SocialStructureofAccumulationTheoryforthe21stCentury,pp.309-353).

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ApplicantsandAppointeestotheJordanianCivilService(1990-2017)433

433 DataprovidedtheBureauoftheJordanianCivilService

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SocialWelfare

Socialwelfareoperationsconstitutethesecondpillarofthestate’smassoriented

interventionsintheeconomy.Forclarity’ssake,Ihavegroupedpovertyalleviationprograms,

publiceducationprograms,andhealthcareprogramsunderthiscategoryofstateintervention.

Atthemacrolevel,onemustbeginherebyacknowledgingthattheuniversalism

previouslyanchoringwelfareinJordanhasbeenlargelydiscardedunderAbdullah.434Hastening

thestate’sgeneralizedretreatfromthesocialdomain,welfareisnowprimarilyoriented

accordingtothelogicofmeans-testing,Evidenceofthisisthereplacementofthestate’s

subsidizationofconsumergoods435—aswellastheMinistryofSupplythatoncemanagedits

administration—withapovertyalleviationprogrampremisedontargetedcashtransfers.436

CashtransfersareadministeredbytheNationalAidFund(NAF),whichisabranchofthe

MinistryofSocialDevelopment.Unsurprising,perhaps,forthoseacquaintedwiththeglobal

reputationoftransfer-basedpovertyalleviationprograms,theNAF’seffortshaveprovenwoefully

inadequateonanumberofdifferentlevels.First,thecriteriadeterminingwhetheranapplicantis

eligibletoreceivesuchaidareundulydiscriminatoryandaustere.Sotofulfillamandatedictating

434 Aswascoveredinpreviouschapters,thewelfarismofAbdullah’spredecessorhadbeengroundedinuniversalist

principles.Onemanifestationoftheseprincipleswasthestate’ssubsidizationofbasichouseholdgoods,whichhadservedasoneoftheprimarymechanismthroughwhichthestatecouldbothsupportmiddleclassconsumption,ensurethebasicneedsofimpoverishedcommunities,andfacilitateprofit-seekingamongstpoliticallyconnectedmerchantelites.

435 Thefinalrelicoftheoldsystem,thebreadsubsidy,waswithdrawnin2018.436 Thestatehasalsoworkedtoteachthepoortofishthroughsupportingtheirhouseholdbusinesses.Therein,

governmentshaverelieduponmicrofinancestyledoperations,MSME-relatedinitiatives,andvocationaltrainingprojects.

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thatonlythetrulyneedyreceivestatesupport,allbuttheelderly,thephysicaldisabled(i.e.those

physicallyunabletowork),thefamiliesoforphans,andsingleparent,female-ledhouseholdsare

excludedfromtheNAF’sremit.Whatisworse,theFundalsostipulatesunemploymentasan

eligibilityrequirement.437GiventhatamajorityoftheJordanianlaborforceearnswagesator

barelyabovethepovertyline,theunemployment-basedconditionalityoftheNAF’sassistanceis

highlyconsequential.WhenonealsoconsidershowpaltrythesumsarethattheNAFactually

doesdoleout438andthefactthatbureaucraticfailures—i.e.theabilitytolocateandregister

householdsandindividualsacrossJordan’surbanandruralgeographies—inevitablyleadsto

hundredsofthousandsofeligiblecandidatesslippingthroughtheadministrativecracks,the

shortcomingsoftargetingbecomeevenmorepronounced.

Anempiricaldemonstrationmaybetterilluminatetheinadequaciesofthestate’scurrent

povertyalleviationefforts(andevinceyetanotherdepreciationinthestate’smass-oriented

interventionism).Acceptingextremelyconservativenationalpovertylinecalculations—and,for

themoment,ignoringhowtheformulabehindthesecalculationsstructurallydeflatepoverty

figures439—,itcanbeestimatedthatsomewherebetween14-15%oftheJordanianpopulation

437 Eveninthecaseofunemployment,moreover,italsomakesaccesstoaidconditionalonanindividual’s

enrollmentinvariousvocationaltrainingprograms.438 AccordingtotheNAF’sinternaldocumentsandannualreports,totalcashdispensedin2018totaled80,052,833

JD.Thatworksouttoroughly1094JDofincomesupportperfamily,orroughly91JDinstateassistancepermonth.TheseamountsarenowherenearsufficientforhelpingafamilycopewithJordan’severacceleratingcostsofliving.AsthetemporarycashaiddistributedbytheNAFreachedonly17millionJDduringthatsameyear,moreover,theutterinadequacyofthatpartofthesocialsafetynetthatismeanttohelpthoseattheverybottomcomesintostarkerrelief.

439 In Jordan’s case, such methods led the Department of Statistics to posit a national poverty line of 813 JD per individual

as of their most recent calculations (2010).

215

livesinwhatwouldbedeemedpermanentpoverty.Thispercentagetranslatesintoroughly1.5

millionpeople.Whenoneaddsthetransientlypoortothisfigure440,thenumberofaggregate

impoverishedJordaniansjumpscloserto3.5millionpeople,orroughly33%ofthetotal

population.441Byconsequenceoftargeting’sfastidiousrationalities,however,only73,162

families(afiguretranslatingto243,054individuals)receivedcashaidfromtheNAFin2018.442A

simplesubtractionoperationrevealsthattargetingtherebyleavesroughly3.2millionpoor

peopleoutsidetheremitofstatesupport.EvenaccountingfortheSyrianrefugeepopulation,itis

clearthattheNAF’stargetedpovertyalleviationmechanismsare,therefore,quiteliterallyleaving

millionsofJordan’spoorwithoutaccesstoanycashassistance.

Ifwelfaristeffortsinpovertyalleviationhaveunderwhelmed,sotoohaveeffortsinpublic

education.AcrossAbdullah’stenure,thegovernmenthasspentroughly3.5-3.8%ofGDPon

publiceducation.443Thatlevelofexpendituresisquitelowrelativetotheexpendituresofother

lower-middleincomecountries444,andgoesalongwaytowardsexplainingJordanianstudents’

well-documenteddeclinesintestingperformanceduringthepost-2000period.445Whatismore,

440 Bytransientlypoor,Imeanthoseindividualslivingbeneaththepovertylineforatleastonequarteroftheyear.441 OmarObeidat,“ThirdofJordan’spopulationlivesbelowpovertylineatsomepointofoneyear—study”,Jordan

Times(July2,2014).442 Thisdatacanbeaccessedat:http://www.naf.gov.jo/naf_sum_years443 DataprovidedbyWorldBank.444 OECDcountriesaveraged12.6%GDPbetween2014-2017. See:JordanStrategyForum,JordanontheGlobalTalentCompetitivenessIndex2018445 Foreducationaldecline,see:KhaledAbuTayeh,MohammadAl-Rsa’i,andMohammadal-Shugairat,“Thereasons

forthedeclineoftheresultsofJordanianstudentsin‘TIMSS’2015”,InternationalJournalofInstruction(11:2),2017,pp.325-338

216

thedecliningqualityofpubliceducationisalsoforcingmiddleandlowerclassfamiliestospend

increasingpercentagesoftheirhouseholdbudgetonprivatetutoring/educationalservices.446

Evidenceofthis,surveydatafrom2017showedthatmeanhouseholdspendingoneducationhad

reached578.8JDperyear,upmorethan140JD(orroughly25%)fromjustfouryearsprior.

Relativetothemedianwage447,theseoutlaysconstituteasizableportionofahousehold’s

expendableincome.Thestate’stacitdivestmentfrompubliceducation,then,beliesadeclinein

qualityoflifeformillionsofJordanians,andiscritical—bothintheshortandlong-term—tothe

country’sstrangecapitalismofcrisis.

Beforeclosingonwelfareandmass-orientedinterventionsmoregenerally,Ishould

acknowledgedthatthestate’seffortsinthedomainofhealthcarehaveprovensomewhatmore

earnest.Attheaggregatelevel,thegovernment’sshareoftotalhealthcareexpendituresreached

ashighas67%in2009beforedecliningbackto57%asof2015.Evenaccountingforthismore

recentebbing,that57%stillrepresentsanincreaseofroughly25%ascomparestoabaselineof

theyear2000.448Whileexactnumbersontheallocationofthesepublicexpendituresaredifficult

tocomeby,significantportionsaredevotedtowardsprovidingfreehealthservicesatpublic

Itshouldbeacknowledgedthatthisdeclinehasbeenpartiallycatalyzedbythemassivepopulationexpansion

Jordanhasexperiencedovertheprevioustwentyyears.446 EconomistsattheWorldBankhavedocumentedthisphenomenon.See:ElenaIanchovichina,Eruptionsof

PopularAnger:TheEconomicsoftheArabSpringanditsAftermath,WorldBank(2018).447 Asof2016,themedianwageinJordanwas370JD.Themedianwageintheprivatesector,however,wasonly300

JDthatsameyear.448 Thepublicshareofhealthexpendituresin2000wasjust44.9%(WorldBankHelathNutrition,Population

statistics).

217

facilitiesforthosecitizensbelowtheageofsixorabovetheageofsixty.449Inaddition,forthose

citizensthatareagedoutofthoseprivilegedcategories,itisalsopossibletopetitioneitherthe

MinistryofHealthortheRoyalCourtshouldoneneedhelpcoveringthecostsofaprocedureor

treatment.Thoughtherearemanyproblemswithsuchadiscretionary,charitableformof

intervention450,theimpactofthispetitioningsystemisstillsignificant:in2013,theRoyalCourt

alonedistributed800$millionthroughthesechannels.451

Themanymeritsofthestate’shealthrelatedinterventionsnotwithstanding,theyarenot

withouttheirshortcomings.Tobegin,duetotheunderdevelopmentoftheprivateinsurance

market,outofpockethealthexpendituresasapercentageoftotalhealthexpendituresremains

significant(28%asof2016).452Despitethestate’ssignificantinvestmentsinthissectorofthe

economy,then,householdsarestillhavingtodevoteasizableportionofexpendableincome

towardspayingforhealthservices.Furthermore,byvirtueofthefactthatthepriceofhealth

servicesincreasefasterthanwagesdo,therelativeamountofhouseholdincomebeingallocated

tohealthservicesisgrowingovertime.SurveydatagatheredbytheDepartmentofStatistics,for

instance,showsthataveragehouseholdexpendituresonmedicalcarehasactuallymorethan

doubledbetween2013and2017alone.453

449 YazanDoughan,“CorruptionintheMiddleEastandtheLimitsofConventionalApproaches,GIGAFocusMiddle

East(5),2017,p.7450 Beyondinevitablyexcludingmanyoftheneedy,thissystemalsorathercynicallyallowsthePalacetoplaytherole

ofbenign,magnanimoussaviorinprovidingaservicethatshouldhavebeenprovidedwithoutanyneedforsuchapersonalistintervention.

451 Doughan(2017),p.8452 DataprovidedbytheWorldHealthOrganization’sGlobalHealthExpenditureDatabase.453 DepartmentofStatisticsHouseholdExpenditureandIncomeSurvey2008,p.137

218

Intotal,then,whilethestate’smass-orientedinterventionsdocontributetothesocial

embeddingofJordaniancapitalism,theyarenotofthescalenecessarytotrulysecurethe

livelihoodsandwelfareofJordan’smiddleandlowerclasses.Thoughtheseinterventionsmay

helppartiallystabilizetheaccumulationprocess,then,theydosowhilealsoreproducingthe

kindsofsocialprecaritythatinvestJordaniancapitalismwithitsunderlyingfragilityandcrisis-

orientednature.Thesamecanbesaidofthestate’selite-orientedinterventions.Thoughsecuring

profitsforacertainfractionofthecapitalistclass,theywillbeshowntohaveincentivizedand

facilitatedbehaviorsthataredevelopmentallydestructiveinthelong-term,furtherconsolidating

thecrisistendenciesoftheeconomy.

Elite-OrientedInterventionsintheEconomy

(1)HashemiteFiscalSociology:RevenueGenerationandPublicExpendituresunderAbdullah

DepartmentofStatisticsHouseholdExpendituresandIncomeSurvey2013,Table4.24 DepartmentofStatisticsHouseholdExpendituresandIncomeSurvey2017,Table4.6 In2013,theaveragewas214.6JD;asof2017,itwas486JD.

219

Jordan’sfiscalsociologyhasshiftedconsiderablyunderthedirectionofKingAbdullah.The

starkclassbiasesitnowevincesderivefrommanysources,chiefamongstthemtherevenue

strategyadoptedunderthecurrentregime’swatch.Tobegin,thisstrategyleansheavilyupon

regressive,downwardlypunitivetaxesonconsumption.454Suchtaxeshaveconstitutedroughly

65-75%oftotalannualtaxrevenueandmadeup36-48%ofthegovernment’stotalannual

revenuesthroughoutthetenureofthecurrentKing.455

454 Taxrevenueshaveconstitutedbetween55-66%totalgovernmentrevenuesbetween2005and2017.The

government’sothermajorrevenuestreamsincludeforeigngrants,propertyincomerevenue,revenuefromsalesofgoodsandservices,revenuefromfinesandpenalties,andrevenuesfrommiscellaneoustransfers.

455 DataforgraphsprovidedbytheInternationalMonetaryFund.

Red:Taxes on International Trade and Transactions Orange: General Taxes on goods and services Purple:Taxes on corporate income, profits, and capital gains Green:Taxes on individual income, profits, and capital gains

220

Compoundingthedistributiveeffectsgeneratedbythistaxstructure456havebeenthe

upwardlyredistributiveeffectsofdomesticborrowing.Thismodalityofborrowingwasinitially

discussedinthecontextofthe1973-1986SSA.Functionallyspeaking,thestate’sbond

issuances—inconjunctionwiththelackofanysignificantprogresswhenitcomestoincomeand

corporatetax457—areupwardlyredistributivetotheextentthattheyimplyafuturetransferof

456 OneshouldacknowledgethatthesetaxesonconsumptionwereinitiallyintroducedasaGeneralSalesTax.

Shortlythereafter,however,thesystemtransitionintothegeneralizedValue-AddedTaxthatitnowoperatesaccordingto.

457 Aswellasthepervasivenessoftaxevasion,asIwilldiscuss.

TheValue-AddedTax(VAT)inAbdullah’sJordan RegardingthedetailsofAbdullah-erataxesonconsumption,itshouldfirstbeacknowledgedthattheGeneralSalesTaxsystemwasinitiallyintroducedonlyafterexemptinganumberofgoodsfromitspurview,andthatthoseexemptions(ongoodslikebread,tea,rice,andmilk)hadbeendesignedsotoinsulatethecountry’spooraswellassignificantportionsofitsmiddleclassfromtheworstofthetax’spotentialeffects.Overtime,however,Abdullah’spolicyplannershavemethodicallyremovedmanyoftheseexemptions.Thoughexemptionsstillremaininplaceforsugar,riceflour,cookingoil,lamb,beef,chicken,fish,freshmilk,andtea,beginningin2018,a10%taxwasimposedonpackageddairyproducts,eggs,essentialvegetablesliketomatoes,potatoes,andcucumbers,frozenmeat,freshfish,andfruits(JeremySharp,“Jordan:BackgroundandU.S.Relations,Report:CongressionalResearchService(2018),p.2).Withtheexceptionofthissmallnumberofspecialgoods,moreover,theVATsystemnowimposesaunifiedtaxrateof16%onnearlyeverythingelsesoldinthedomesticeconomywiththeexceptionofthosetransactionsoccurringwithinJordan’sconstellationofspecialeconomiczones. 2015to2018alsosawthetaxrateplacedongasoline,petrol,kerosene,andfuelderivativesjumptounprecedentedlevels.Asof2018,taxesimposedonalitreof95octaneunleadedgasolinerepresentedapproximately57.2%thetotalpriceofthatlitre,taxesonalitreofkeroseneconstituted26%ofitstotalprice,andtaxesondieselconstituted26.2%ofitstotalprice(JordanTimesEditorialStaff,“’Reallyhigh’taxesonfuelpartofKingdom’spolicytosupportTreasury—Zawati”,JordanTimes(July29,2018).Byconsequence,workingclassfamilieshavealsobeenforcedtoreckonwithsubstantialincreasesinthecostoftransportationandcooking.Whilethefueltaxesinparticularhavebeensoldthroughegaltiarian-coatedenvironmentalistappeals,moreover,thismystifiestheclass-biasthatisbasictoanysuchflattax—especiallythosethatarenotsupplementedbystateinvestment/subsidizationofpublictransportationintheseinstances.WithJanuary2018alsoseeingthegovernmentfinallyliftitsdecadelongsubsidyonbread—amovethatincreasedthepriceofbreadbybetween60-100%,andthatwaspartneredwithasystemofconditionalcashtransfersmeanttooffsetthepriceincreasesforthosefamiliesdeemedsufficientlypoor—,theregressiverevenuestrategyhithertodescribedhascometobepairedwithpunitivereductionsinexpendituresaswell.

221

incomefromtaxpayertothehandfulofcommercialbanks(andtheireliteowners)thatare

licensedtoparticipateinthesovereigndebtmarket.458Atthesametime,then,ashousehold

budgetsarebeingsqueezedbytheVATandthegrowingcostofbasicnecessities,thosesame

householdsarealsobeingplacedonthehookfortheinterestpaymentstheJordanian

governmentincreasinglyowestothecountry’sfinancecapital.Theaggregateresult—where

householdstransfersubstantialportionsoftheirincometothestatewhiledomesticfinance

enjoyshealthyrateofreturnsontheconstellationofdebtinstrumentsthatitaloneisfreeto

acquire—isahighlypolarized,developmentallycompromised459,capital-dominatedfiscal

sociology.

Togivethesepolarizingeffectssomekindoforientingcontext,considerthatinterest

paymentsonlocally-helddebtaloneconsumed8.74%oftotalstateexpendituresin2017aswell

as68.5%of2017’stotalcapitalexpenditures.460Asthesepercentagesdwarfwhatthestateis

spendingonsociallyanddevelopmentallyessentialdomainssuchaseducation,researchand

458 Thisredistributiveeffectisfurtherenhancedbythefactthatinterestratesongovernmentissueddebtexceed

averageprivatesectorprofitratesbyaconsiderablemargin.Notonly,then,arethesefinancialinstitutionsultimatelytakingmoneyoutofthepocketoftaxpayers.Asonlylicensedfinancialinstitutionshaveaccesstothesebondmarkets,theirreturnsarealsoartificiallyjuicedvis-a-vistheircapitalistcompetitors.

Withgovernmentsecuritiesnowcomprisingapproximately22%oftheaggregateassetsheldbythedomesticbankingsector,saidfinancialinstitutionshavebeenquitekeenintakingadvantageoftheirprivilegedposition.Almostbydefinition,then,thedesignedexclusivismofthedomesticbondmarkethasnecessarilyimpliedarelativetransferofwealthtoJordanianfinancialcapital.

See:JordanStrategyForum,AmmanStockExchange:TheWayForward,Report(Amman,2017),p.14459 Developmentally,oneofthemoredirect(andnegative)consequencesofthegovernment’sbondissuances

concernsitscrowdingouteffect.Morespecifically,byabsorbingsignificantpercentagesofthefinancialsector’sinvestmentcapital,thegovernment’sdebtstrategywindsupreducingtheamountsofcapitalthatareavailableforproductiveinvestmentelsewhereintheeconomy.Toacertainextent,then,thisrevenuestrategyallowsbankstoavoidrisk-seekingandprofit-seekinginvestments,therebystiflinggrowthandinnovation.

460 JordanStrategyForum,Ontheimportance…(2018),p.6.

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development,targetedcashtransfers,andwelfaristinterventionsmoregenerally,theyquitetidily

representtheextenttowhichtheinflowsandoutflowsofAbdullah’sfiscalpolicyprivilegecertain

eliteactorsattheexpenseofdevelopmentandsocialequity.461

461 Asthesebondissuanceshelptofinancecurrentexpenditures(andthewagesoftheKing’slowskilledpublic

sectorworkforce),ofcourse,theyareactasacriticalmechanismwithintheKing’sauthoritarianrenewalstrategy.

Capital’sReturnsontheDomesticBondMarket Asofthetimeofwriting,domesticallyissueddebtinstruments—acollectionofbondsandtreasurybillswithtenorsrangingfromonetotenyears—constitute60.5%ofthegovernment’stotaldebtportfolio(MoFdocument).Relativelyshort-termbondsandbillsoftwo,three,andfiveyeardurations,moreover,compriseroughly60%ofthistotal.ThoughtheMinistryofFinance’sdistinguishesbetweendomesticandexternaldebtonthebasisofcurrencydenomination(nottheresidenceoftheinvestor)andtherebypotentiallyoverstatesthemagnitudeoflocallyhelddebt,Saif’s2017researchestimatesthat54%ofgovernmentdebtisinthehandsofdomesticinvestors(JordanStrategyForum,Ontheimportance…(2018),p.6). Disaggregatingthedebtinstrumentsissuedin2018and2019alonebymaturitydate,theaverageinterestrateonasixmonthtreasurybillwasapproximately4.1%;theaverageinterestonaoneyeartreasurybillwasapproximately4-4.2%;theaverageinterestrateonatwo-yeartreasurybillwasapproximately4.15%;theaverageinterestrateonabondofthreeyearswasapproximately4.5%;theaverageinterestrateonabondoffiveyearswasapproximately5.45%;theaverageinterestrateonabondofsevenyearswas6.3%;theaverageinterestrateonabondoftenyearswasapproximately6.8-7%;andtheaverageinterestrateonabondoffifteenyearswas7.9%(dataprovidedbyAmmanStockExchange).AsofFebruary2019,themainrateonJordaniangovernmentbondswas4.75%.Theweightedaverageinterestrateonthestate’sgrossdomesticdebtasof2017,meanwhile,was4.1%.Importantly,thisisafigurethatisnearlydoubletheequivalentratewhenitcomestothecountry’sexternallyhelddebt(2.4%).

223

GraphprovidedbyJordanStrategyForum,AmmanStockExchange:TheWayForward(2017),p.14

BeforeclosingontheconstructionofJordan’scontemporaryfiscalsociology,Ineedalso

makenoteofthedistributiveeffectsyieldedbythestate’sfacilitationoframpanttaxevasion.

Withanissueasmurkyastaxevasion,itisdifficult,ofcourse,toestimatemagnitudeswithany

degreeofprecision.AgeneralsenseforJordan’sstrugglesinthisarea,however,canbegained

throughabriefreviewofaggregatecorporateincometaxreceipts.Suchareviewwasprovidedby

theIncomeandSalesTaxDepartment,whichissuedareportin2017indicatingthatitcollected

lessthanJD60millionintotalfromthe132,000registeredandactivecompaniesthatfiledtaxes

thepreviousyear.462Perfirm,thisfiguretranslatestoanaveragecontributionof455JD.Given

thatcorporatetaxrateoutsideJordan’sspecialeconomiczonessitsat20%,suchcontribution

ratesimplyeithersystematicevasionoraneconomicdepression.Whenonealsoconsidersthe

morepulpyfindingsrevealedfollowingthereleaseofthePanamaPapers—findingsimplicating

manyofJordan’spoliticalandeconomicelite,includingtheroyalfamily,intheMossackFonseca

overseenscheme—,itisalsopossibletoseehowthiskindofbehaviorreachesto(ifitisnot

462 JordanTimesEditorialStaff,“132,000companiesinvolvedintaxevasion”,JordanTimes(April28,2018).

224

directlyencouragedby)theverytop.463Inviewofthesetwodatapoints,onecanassumethattax

evasionislikelycostingthestatehundredsofmillionsofJDinannualrevenuesatthesameasitis

facilitatingupwardandoutwardredistributionsofwealth.

Tosummarize,thefiscalsociologyinstitutionalizedunderAbdullah’sleadershiphasledto

bothasignificantupwardtransferofwealthandtheintense,persistentsqueezingofJordan’s

distressedmiddleandlowerclasses.TheextremitiesofJordan’ssocialpolarizationinthe

contemporaryperiodandthestructuralizedinstability,inefficiency,andinequalityconstituting

itscontemporarymodalityofneoliberalcapitalismareinnosmallpartafunctionofthe

institutionalizationofthisperiod’selite-orientedtaxpolicy.

(2)Privatization464

Operationally,Abdullah-eraprivatizationhasbeencarriedoutthroughthreedifferent

kindsoftransactions.PerKnowles,thefirstoftheseseesthegovernmentitselfsellequityit

463 TheoriginalArabiclanguagepublicationonthePanamaPapersscandal(asitrelatestoJordan)hasbeenpulled

fromAmmannet.net’sserver. Forinformationontheinvestigationandpeopleimplicated,see:DaoudKuttab,“PublishingthePanamaPapersin

Jordan”,ZenithMagazine(2016). Dataavailableat:InternationalConsortiumofInvestigativeJournalists,ThePanamaPapers:ExposingtheRogue

OffshoreFinanceIndustry(https://offshoreleaks.icij.org/). 464 SchlumbergerhasarguedthatAbdullah’sprivatizationinitiativesservedtwoprincipalfunctions.Ontheone

hand,itallowedKingAbdullahtoperformtheroleofearnestneoliberalreformer.Byprivatizingkeyassets,hecouldpartiallysatisfythewantsofhisforeigncreditors(andhisbackersinthewest)whilenotyetriskingthekindofsocialupheavalthatwereimmanenttootherareasofthestructuralreformpackagesuchassubsidyremovalormasslayoffsinthepublicsector.Ontheotherhand,privatizationandtheunderpricedtransfersofvaluablestateownedassetsthatitenactedalsoallowedhimtoconsummateanewpartnershipwithanowtransnationalizedcoalitionofcapitalistallies.

225

directlyholdsinvariousSOEstoanemergentconstellationofstrategicforeignpartners.465In

practice,theseexternally-orienteddirectequitysalesservedasthechiefmechanismthrough

whichthestateoffloaded(atleastpartially)anumberofkeyindustrialassetsintheearly

2000s.466Itwasthroughthismeans,forinstance,thatFrance’sLafargeacquiredwhatwould

becomea50.2%equityshareintheJordanCementFactoryCompany.467Similarly,thiswasthe

meansthroughwhichCanada’sNutrienLtdbecamethesinglelargestshareholderintheArab

PotashCompany(28%ofequity),afamouslyproud,formerlypan-Arabist(andpubliclyowned)

465 TheoneexceptiontothisruleistheJordanianPetroleumRefineryCompany(JPRC),whichremainsorganizedas

anSOEasofthetimeofwriting.ManyofAbdullah’seconomizedelite—includingAlaaBataineh,Omaral-Kurdi,andWalidAsfour—sitonitsBoard.

See:Knowles(2001),pp.236-247.466 ThiswasalsothemechanismthroughwhichthestatedivestedfromthehighlyprofitableJordanian

TelecommunicationsCompany.Theinternalpolitics—andtheaggressivecontestsforrentsthatpittedtwomembersofGenerationAbdullah,JamalSarayrahandAliShukri,againstoneanother—involvedinthispartialsalehavebeenwelldocumented.Asiteventuallyplayedout,40%oftheJTCwoundupsoldaconsortiumcomprisedofFrenchTelecom(35.2%)andArabBank(4.8%).

467 ItwasactuallyHamdiTaba’a,oneofthetrueelderstatesmenofJordaniancapital,whowasChairmanoftheJCFC

atthetimeofthistransaction. AfterLaFarge’sacquisitionofamajorityequityshare,theSocialSecurityCorporationstillretaineda21.8%stake

inJCFC,therebyinsuringacontinuationofstateinfluence.TheestateofChaabiMiloudholds10.3%equityandisthethirdlargestshareholderatthetimeofwriting.

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entity.468DirectequitysaleswerealsousedinthecaseoftheJordanianPhosphateMines

Company(JPMC)469andtheJordanianFertilizerCompany(JFC).470

Internally-orienteddivestmentscarriedoutbyJordan’snominallyautonomouspublic

creditinstitutionsconstitutethesecondkindofprivatizationtransaction.Generallyspeaking,it

hasbeenthepublicsector’spensionfund,theJordanInvestmentCorporation(JIC,laterrenamed

theSocialSecurityCorporation,orSSC)),thatorchestratesthesetransactions,andgenerally

speaking,theJIC/SSChasoffloadedminorityshareholdingstolocalstrategicinvestors.Ifthefirst

kindofprivatizationtransactionhadfunctionedsotoselloffJordan’sindustrialbasetoforeign

actors,thesecondkindfunctionedsotransferagreatdealofpublicwealth(andhealthySOEs)

intotheprivatehandsofthepoliticallyconnectedbusinesselite.Sociallypolarizingasthese

divestmentoperationswerealwaysboundtobe,theireffectendedupbeingdoublysoduetothe

factthatinpractice,thepubliccreditinstitutionswoundupsellingtheirsharesinmoreprofitable

assetsandbusinesses(atdiscountedprices)whileretainingmoretoxicassetsontheirbalance

468 JamalSarayrah,amanwhowouldalsofindhimselfatthecenteroftheJordanTelecommunicationsCompany’s

privatization,sitsasChairmanoftheBoardattheArabPotashCompanyatthetimeofwriting.469 TheoriginalbuyersoftheJPMCwerethegovernmentofBrunei(37%)andtwosubsidiariesoftheIndian

FarmersFertilizersCooperative(9.62%).UpontherevelationsofcorruptiononthepartofJPMCCEOWalidKurdiin2012—whoistheuncleofKingAbdullahandwhohaslivedintheUKsincethesecorruptionscametolight—,thegovernmentofBruneidivesteditssharestotheaforementionedIndiancooperative.Thistransactionwascompletedin2018.

470 TheJordanFertilizerCompany(JFC)wasitselfa(toxic)subsidiaryoftheJPMC.Duringtheearly2000s,itwas

effectivelysplitintotwoseparateentities,eachofwhichwouldbereformedasajointventurecompanythroughpartnershipswithtworespectiveforeigninvestors.TheJFC’sone-timesouthernoperationscametobeoperatedbyalimitedliabilityjointventurecompanycalledNipponJordanFertilizerCompany,whileitsnorthernoperationswouldbesteeredbythesimilarlyorganizedJordanIndianFertilizerCompany.

227

sheets.471Byconsequence,thisformofdivestmentwas,functionallyspeaking,enrichingwell-

connectedspeculatorsthroughdegradingthevalueandhealthoftheJIC’sportfolio—aportfolio

uponwhichthepensionsofpublicsectorworkersdepended.Indirectly,then,theseprivatization

transactionsimpliedaprocessofaccumulationthroughdispossession.

Thethirdkindofprivatizationtransactionseesthestatefirstleaseandthensubsequently

transferpublicassetstoeitherforeignordomesticconsortia.472Policyplannerstypicallyoptfor

thismechanismindealingwithcapital-intensiveinfrastructureorcriticalutilitieslikewater

servicesandelectricitydistribution.Specifictotheformer—andinadditiontotheprivatization

ofAqabaPortthatwasdiscussedinchaptersix—,notableprivatizationsofthistypeinclude

QueenAliaAirport,theAmmanCityBussystem,andtheAqabaRailroadCorporation.473Asfor

theprivatizationofutilities,oneneedbeginwithwaterservices—andwiththeWorldBank.Asis

detailedinBasilMahayni’s2015dissertation,theBankhadactuallybeenpushingforthe

privatizationofwatermanagementsincethe1990s;itevenfinancedthemanagementcontract

throughwhichtheWaterAuthorityofJordanfirstintroducedcorporategovernancetoitsAmman-

471 ThiswouldbeseenintheJIC’sretentionoftheJordanTobaccoandCigarettesCompany,forexample.472 Ofthemechanismthreestyledprivatizations,IshouldnotethatAbdullah’spolicyplannersalsousedalease-

transferagreementtoturntheJordanPoultryProcessingandMarketingCompanyovertoAbdulHadiHammoudeh,whoseHammoudehGroupoperatesamulti-sectorconglomeratestretchingfromdairyandmeattochemicalstoplasticstocleaningsuppliestogeneralizedtradingandinvestment(http://www.hammoudeh.com/SubDefault.aspx?PageId=186&MenuId=88).

473 Thoughvirtuallynoprogresshasbeenmadesincethesigningofthecontract,theAqabaRailroadCorporation

wasofficiallysoldtoaconsortiumledbyRaytheon,theWisconsinCentralTransportationCorporation,Mitsubishi,theJordanPhosphatesMiningCompany,andtheKawarGroupduringtheearlydaysofAbdullah’sreign(Knowles,2001,p.243).

228

basedoperations.474Bytheearly2010s,theBank’sconsistentproddingwassufficienttoensure

thatthecommercialization(thoughnottheprivatization)ofwatermanagementspreadtoAqaba

aswell.475Beginningin2011,USAid(throughitsInstitutionalSupportandStrengtheningProject)

joinedtheBankinpushingtheJordanianstatetomovebeyondtheselocalizedinterventionssoto

corporatizethenationalwatermanagementsystem.Workinginconjunctionwithtwoforeign

consultancies—InternationalResourcesGroupandEcoConsult—Aidhas,todate,achievedsome

moderatesuccessesonthisfront.In2012,theJordanianauthoritieswerepersuadedtosetupa

limitedliabilitycompanyatthenationallevelandtorationalizingwatertariffssothattheprices

paidbyhouseholdsmoreaccuratelyreflectedthecostofwaterprovisions.476

Inadditiontothecommercializationofwatermanagement,anumberofmoreexpansive

contractsconcerningtherehabilitationofthecountry’slargerwaterinfrastructurehavebeen

tenderedtoprivatefirmsduringAbdullah’stenureaswell.Themostsubstantialofthese—the

474 BasilMahayni,CrisisinJordan’sWaterSector?UnderstandingtheDynamicsofInstitutionalandPolitical

ConstraintsinWaterManagementandCorporatizationReforms,Doctoraldissertation,UniversityofMinnesota(2015),p.110.

This$55millioncontract,awardedin1999,wenttoaconsortiumledbyLyonnaisedeEaux,aFrenchcompany

workingincollaborationwithMontgomeryWatsonandArabtechJaradneh(LEMA).475 Ibid,pp.115-116. MuchofthisproceededunderthebanneroftheCapitalInvestmentProject.Atthetimeofwriting,water

managementinAmmanisrunbytheJordanWaterCompany-Miyahuna,whichisitselffullyownedbytheWaterAuthorityofJordan.InAqaba,theAqabaWaterCompany,whichisjointlyownedbytheWaterAuthorityofJordanandASEZA(thelatterofwhichholdsa15%stake),handlesmanagement.

476 Ibid,p.121. Whilethepriceofwaterhasnotyetbeenpassedontotheconsumerinfull,giventhenatureofwaterdistribution

inJordan—onceaweek,theaforementionedmanagementcompaniesfilltanksthatsitontopofindividualapartmentbuildings;eachtankcorrespondstoasingleapartmentwithinthatbuilding,andmustlastthathouseholdafullweek—,itishardtoenvisionanyschemeforincreasingpricesthatwouldnotberegressiveinnature.Aflatincreaseonthetariffindividualhouseholdsarepayingfortheirweeklyallotmentofwater,forinstance,wouldbedisproportionatelyinjurioustothepoor.

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muchballyhooedDisiWaterConveyanceProject—entailedtheconstructionofa325kilometer

pipelinethatwastotransportwaterfromtheDisiaquiferinthesouthofthecountryalltheway

uptoAmman.LikewiththeairportandAqaba’sport,thiscontracthadbeenstructuredasa

build-operate-transferagreement—andjustaswasthecaseinthosepreviousinstances,the

contracthadbeenawardedtoaforeignfirm.477Unlikethosecases,however,theDisiConveyance

Projecthasbeenanunambiguous,irrefutabledisaster.Miredincorruptionandmalpracticefrom

thestart,theJordanianMinistryofWaterandIrrigationwaseventuallyforcedtotakesaidforeign

firm(namely,Diwaco)tothePermanentCourtofArbitrationafterthefirm,strugglingwitha

numberoflogisticalandtechnicalchallenges,attemptedtoextract$460millionfromthestate

withouthavingmadeanyrealprogressonthepipeline.478WhiletheMinistrywonthecase,the

ordealhascertainlylaidbaresomeofthedangersinherenttoAbdullahetal.’spreferencetowards

theprivatizationofpublicinfrastructure.

477 Diwaco,asubsidiaryoftheTurkishconglomerateGAMAEnergy,wonthecontract.478 Forthereportingofthisscandal,see:HanaRamrouqa,“WaterministrywinsDisi-relatedarbitrationcaseworth

$460m”,JordanTimes(February23,2018).

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Whenitcomestoenergygeneration,privatizationhasalsotendedtotransferpublicassets

intoforeignhands.ThelargestoftheprivateactorsnowoperatinginthisspaceistheCentral

ElectricityGenerationCompany(CEGCO).Atthetimeofwriting,thefirmoperatesathermal

powerstationinAqaba,agaspowerstationinRisha,ahybridgas-turbinepowerstationin

Rehab,andwindpowerstationsinIbrahimyahandHofa.Inthepastsevenyearsalone,ithas

beentenderedtwelvegovernmentcontracts.OriginallyasubsidiaryofEnara—theDubai-based

energyinvestmentarmofJordanDubaiCapital—,CEGCOwasacquiredbytheSaudi-basedICWA

SellingtheQueenAliaAirport AswasthecasewiththeAqabaPort,thecontractfortherenovation,reconstruction,andoperationofAmman’smaininternationalairport—awardedtotheAirportsInternationalGroup(AIG)in2007—wasstructuredaccordingtoatwenty-fiveyearbuild-own-transferagreement.AIG’smajorityshareholderistheParis-basedADPInternationalS.A.(51%equity).MeridiamEasternEuropeInvestmentsholdsanadditional32%,theUAE-basedMENAAirportHoldingsLtd.Holds12.25%,andtheEDGOGroup,oneofthemanyentitiesownedbytheMasrifamily,holds4.75%.RegardingtheMasriconnect,MunibMasriisEDGO’sChairmanandOmarMasriishisViceChairman. AIG’soperationswerefinancedmostlybytheIFC,theIslamicDevelopmentBank,andahandfulofregionalpartners,includingtheKuwaitbasedNoorFinancialInvestmentCompanyKSCCandtheAbuDhabiInvestmentGroup(InternationalFinanceCorporation,QueenAliaInternationalAirport—theRoleofIFCinFacilitatingPrivateInvestmentinaLargeAirportProject,Report:EMCompass2017,p.2).ItsparticularB-O-TagreementwiththeJordanianstatestipulatedthatthestatewouldretainofficialownershipoftheairportforthedurationofthetwenty-fiveyearcontract,thatthestateassumesalltheproject’sdebtsintheeventofcontracttermination,andthatthestatereceivesroughly54%oftherevenuesgeneratedthereinduringthesameperiod.Importantly,however,afterthetwenty-fiveyearleasepasses,ownershipofQueenAliawillbetransferredtoAIGinfull(MadhaviGosavi,QueenAliaInternationalAirportProject,Jordan,Report:NortonRoseLLP,2009).Inviewofthosewhostandtobenefitfromsuchatransfer,theAirport’srenovation,liketherenovationofAqaba’sport,wascarriedoutinsuchamannersoastoensurethattheinterestsofanumberof(transnational)eliteprivateactorsareserved.

231

PowerInternationalin2011.479JoiningCEGCOintheJordanianenergygenerationbusinessisthe

US-basedAESCorporationandJapan-basedMitsuiandCompany,whichtogetherledtheAmman

EastPowerPlanproject.480Asforthedistributionofenergy,Abdullah’splanners(initially)opted

tolease-transferelectricitydistributionoperationsouttotwoprivateentities.TheElectricity

DistributionCompany(EDCO)wasgivenexclusivedistributionrightsacrossthegovernoratesof

Karak,Tafilah,Ma’an,andAqabaaswellasacrosstheentiretyoftheJordanValleyandthose

easternlandsborderingIraq.TheIrbidDistrictElectricityCompany(IDECO),meanwhile,won

distributionrightswiththegovernorateofIrbid.Shortlyafterthesearrangementswere

established(2009),theKingdomElectricityCompany(KEC),whichalreadyowned100%of

EDCO’sshares,purchased55.4%ofIDECO’sshares.Byconsequenceofthisacquisition,adefacto

monopolycametocontrolelectricitydistributionacrossthemajorityofJordan’sterritory.481

ThoughthepubliclymanagedJordanElectricityDistributionCompany(JEDCO)stillretains

controloverelectricitydistributionmarketinAmman,itsnearlydecadelongflirtationwith

insolvency—whichrequiredanumberofcapitalinjectionsafterpoliticalcrisisinSinaisentgas

pricesskyrocketingbetween2011and2015—,inconjunctionwiththerelentlessadvocacy

undertakenbytheIFIsinpushingforJEDCO’sprivatization,suggestsittoomaycomeunderthe

controlofKECintheneartomediumtermfuture.

479 ThegovernmentofJordanandtheSocialSecurityInvestmentFundretainroughly49%equityinCEGCO.480 FinancingforthisprojectwasprovidedbyUSOverseasPrivateInvestmentCorporation,JapanBankof

InternationalCooperation,andtheSumitomoBankingCorporation;riskwasguaranteedbytheIBRD.481 FormoreontheKEC,see:http://www.kec.jo/electricity-distribution-company-edco

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AquicklookattheKEC’sboardofdirectorsgivesanindicationofhowtheregimehasused

privatizationasakindofconveyorbeltforusheringoldpoliticalelitesandPalaceacolytesinto

thecircuitsofrentthataresobasictoAbdullah’sneoliberalcapitalism.NadiaRawabdeh,

previouslyaDirectoroftheSocialSecurityCorporationuntilherretirementin2018sitsasKEC

ChairmanoftheBoardatthetimeofwriting.JoiningherontheboardisZiyadHomsi,Chairman

oftheAmmanChamberofIndustryandamultipletermSenator.Finally,tyingtheroyalfamily

directlyintothewiderprivatizationgrift,AlaaBatayneh—amultipletermSenator,former

MinisterofEnergyandMineralResourcesduringFayezTarawneh’sgovernment,boardmember

fortheJordanianPetroleumRefineryCompany,andtheson-in-lawofPrinceHassan—toohasa

boardseatattheKEC.

(3)PublicCreditInstitutionsandEliteEnterprises

IfdomesticelitesbenefitfromtheJIC’s/SSC’sstrategyofdivestment,itisworthnoting

thattheyalsobenefitfromthepubliccreditinstitution’sstrategyofinvestmentaswell.TheSocial

SecurityCorporationinparticularholdssignificantequityinmanyofthecountry’slargest

companiesandrealestatedevelopmentprojects.WiththeSSC’sownviabilitytiedtothe

successesandprofitsoftheseelite-ownedenterprises—andwiththePalace,bydefinition,

holdingavestedinterestintheSSC’scontinuedviability—,SSCinvestmentsaretantamounttoa

royalendorsementandadiscretionary,politicizedinterventioninthefavorofcertainactors

aboveothers.Intiltingthetableinthefavoroftheseactorsandenterprises,theSSC’s

229

233

investmentstherebyfunctionasoneoftheprincipalmechanismsundergirdingJordan’s

compromised,elite-orientedformofmarketcompetition(and,byextension,asoneofthecauses

ofthecountry’sinefficient,underperformingcapitalism).

Index1laysoutalloftheSSC’sinvestmentsontheASE.Thoughdataonitsholdingsin

privatelyoperatedventuresisunavailable,abriefsurveyoftheindexissufficienttogivethe

readerasenseoftheinstitution’seconomicfootprint.Irecommendthereaderreviewitinfullto

betterappreciatethescale(andcharacter)ofthisinvestment.Inplaceofthat,acouplepointsare

worthemphasizing.First,theSSChasmassiveequityholdingsinthebankingsector.AsofMarch

2019,theSSChelda17%stakeinArabBank,a5%stakeinJordanIslamicBank,a21%stakein

JordanKuwaitbank,a20%stakeinJordanCommercialBank,a15%stakeintheHousingBank

forTradeandFinance,a9%stakeinSafwaIslamicBank,a5.2%stakeinBankalEtihad,a7.2%

stakeinCairoAmmanBank,a10%stakeinJordanAhliBank,anda9.9%stakeinBankofJordan.

Asmentioned,theSSCalsobolstersmanyoftheenterprisesdirectlyownedbytheelite

fractionofthecountry’scapitalistclass.Inadditiontoitsinvestmentsinthebankingsector

(detailedabove),thiscanbeseeninthefactthattheinstitutionalsoholdssignificantequityin

JordanInsurance(7%),apropertyprimarilyownedbyUthmanAliUthmanBdeir;intheNuqul

family’sJordanNationalShippingLinesCompany(13.5%);intheMasrifamily’sZaraInvestment

Holdings(12.4%);intheMuasherfamily’sAl-DawliyahforHotelsandMalls(12%);inJordan

Telecom(28.9%),whereSabihMasri’sNoorTelecommunicationsalsoholdsa9.3%stake;inthe

Talhounifamily’sJordanWorstedMills(20%);aswellasholdingsignificantstakesinthebigfive

industrialfirms.

234

(3)Currentandcapitalaccountliberalization:Curatingmarketcompetition

IfAbdullah’spolicymakersmanagedprivatizationinsuchawayastogenerate

opportunitiesandprofitsforbothJordanianandnon-Jordanianeconomicelites,theymediated

thecountry’seconomicopeningsotoservetheparticularistinterestsoftheformerfirstand

foremost.Indeed,despitetheextensivenesswithwhichthecurrentandcapitalaccountshave

beenliberalizedintheaggregateduringthetwenty-firstcentury,throughmeansbothsubtleand

obvious,GenerationAbdullahpolicyplannershavestillconsistentlylimiteddomesticmerchant

capital’sexposuretoforeigncompetitionwithinthosesectorsthataremostcriticaltotheir

profits.482Insodoing,whiletheyhavefacilitatedthetransnationalizationofthecapitalclass,they

havesimultaneouslyensuredthatthedomesticfractionsofthebourgeoiselitewerenot

subsumedorreplacedintheprocess.483

482 Thisisunsurprisingwhenoneconsidersthatthesepolicyplannersarepredominantlymembersofthedomestic

bourgeoiselitethemselves.Inthisinstance,themostrelevantindividualsareSahelal-MajliandRaghdaKurdi,whomanagedinvestmentpolicyduringtheearlyyearsoftheECC.

483 IwilldiscussthisatlengthinthechapterontheexternalarticulationofthecontemporarySSA.Capitaland

currentaccountliberalizationhavecertainlyprecipitatedarapidtransformationinthestructureofdomesticfinance,astructurenowwitnessingnon-nationalsholdamajoritystakeintheaggregateequityofJordan’sbankingsector(and,thereby,anearmajorityintheaggregateequityofallpubliclytradedfirmsontheAmmanStockExchange).GiventhattheglobalneoliberalSSAhasbeencharacterizedbythefinancializationofcapitalandtheconsolidationofatransnationalfinancialcapitalclassmorethananythingelse,Jordan’sopeningofitsbankingsectoralloweditseconomytokeeppacewithglobalchanges,tosatisfythewishesofthattransnationalclass,andtofacilitateitsdomesticbourgeoisie’sintegrationintosuchaclass.Byrestrictingorconditionalizingforeigninvestmentinrealestate,manufacturing,extractiveindustries,communications,andthehospitalitysectors,however,thetransnationalizationoffinancehasnotimpliedthedemiseofJordan’sbusinesselite.Globalintegrationwastherebysteeredsotomakecertainthatthisdomesticbourgeoisiewouldnotbeswallowedanddiscardedbyexternalactorswhoseadvantagesinscalewouldhaveotherwiseledtosuchanoutcome.

235

GraphprovidedbyJordanStrategyForum,ForeignDirectInvestmentinJordan:Shouldwecare?Whyandhow?,Report:2018,p.9

Procedurally,thissubtleprotectionismhasprimarilybeeninstitutionalizedthrough

regulatorymeasuresandsector-specificrestrictionsonFDIinflows.Whilerestrictionsinthe

bankingsectorhavebeenliftedalmostentirely—amovebefittingtheinterestsofinternational

financialcapital—,substantialrestrictions(orconditionalaccess)remaininplacewhenitcomes

torealestate,communications,manufacturing,extractiveindustries,retailcommerce,wholesale

commerce,andengineering.Notonlydotheserestrictionsfunctionsotoprotectmuchoftheold

merchantquotacoterie,agroupwhosebusinessinterestsremaindisproportionallydependent

uponondomesticconsumptionandtheimport-basedcommercialeconomy.Theyalsofunctionso

toforceforeignactorstopartnerwithadomesticoneshouldtheformerwanttoinvestinthe

236

builtenvironment,anareaoftheeconomythatisnowthelifebloodofglobalcapitalism.Thereby

bindingGulfcapital,whichhasaparticularlyacutepropensityforrealestateinvestment,with

domesticdevelopmentmagnates,ahandfulofregime-connectedbuildingcontractors,an

entrepreneurialmilitaryelite(discussednext),andmorepredatiousindividualswithintheRoyal

Courtthroughmegarealestatedevelopment,thecynicaluseofFDIrestrictionshasallowedthe

Palacetodeliverprofitstoallthemembersofitstransnationalcoalition.484Whilethiscoalition-

buildingsimultaneouslyinsurestheeconomy’slong-termunderdevelopment,itisessentialtothe

stabilizationofaccumulationinthehereandnow.

(4)Industrial+InvestmentPolicy:ExportProcessingZones,MegaRealEstateProjects,andMilitary

IndustrialComplex

ThedistributiveeffectsofindustrialandinvestmentpolicyunderKingAbdullahhavebeen

elite-orientedaswell.Theseformsofstateinterventionintheeconomyhavegenerallyadopted

oneoftwoforms.ThefirstIwillconceptualizeaslaissezfaireindustrialpolicy.ThesecondIwill

refertoasmilitarizedindustrialpolicy.

LaissezFaireIndustrialPolicy:ExportProcessingZones,QualifyingIndustrialZones,SpecialEconomicZones,andSpecialDevelopmentZones

484 Whileafewdomesticactorshavebeenalienatedorexcludedfromtheseprocesses—AbuGhazzelehinnew

Abdali—thisformofstateinterventionhasalsobeenextremelyefficaciousinusingcheap,elite-distributedprofitstosolidifytheregime’stransnationalbase.OnetheprimebeneficiarieshasbeentheSaket&LoziContractingCompany.

237

Withthisconceptualization,Imorespecificallyrefertoaseriesofexportprocessingzones

(EPZs)established(orexpanded)overthecourseofthepasttwentyyears.Theorientationof

theseEPZscanbedeemedlaissez-fairetotheextentthattheyprovidefirmsoperatingwithin

theirjurisdictionswithnon-conditionalsubsidiesandinvestmentincentives.485

Laissez-faire,EPZ-basedindustrialpolicyinJordanwasspearheadedbytheEconomic

ConsultativeCouncilinconjunctionwiththeJordanInvestmentBoard(anentitylaterrenamed

theJordanInvestmentCommission).Thesepoliciesbuiltonamodelfirstarticulatedunderthe

QualifyingIndustrialZones(QIZs)initiativethatfollowedJordan’ssigningofapeacetreatywith

IsraeliatWadiArabain1996,andwereinitiallyformalizedundertheInvestmentPromotion

Lawsof2000and2003.486Introducingahistoricaluniqueformofcorporatewelfare,the

InvestmentLawsof2000and2003specificallyestablishedthatallfirmsoperatingacrossa

networkofQIZsanddesignatedindustrialestatesweretobeaffordedatwelveyearsmoratorium

ontaxpayments,fullfreedominrepatriatingcapitalandprofits,exemptionsoncustomsduties

forindustrialinputs,andtaxexemptionsforthesalariesofforeignworkers.487

485 ItshouldbeacknowledgedthattheEPZmodelwasestablishedinJordanpriortoAbdullah’scoronation.Itsfirst

iterationtookshapein1996intheafterglowofJordan’ssigningofapeacetreatywithIsraelatWadiAraba,andwasorganizedaroundaconstellationofQualifyingIndustrialZones(QIZs).

Bytheearly2000s,thirteendifferentQualifyingIndustrialZoneswereinoperation,thevastmajorityofwhichwereactuallyprivatelyownedandoperated.Ononeoccasion,asinglesinglegarmentfactory—Ez-ZayReadyWearandManufacturingCompany—wasitselfdesignatedasaQIZ.Regardlessofownership,however,thegovernmentwouldsubsidizethecostofutilities,communicationsfacilities,andtransportationinfrastructurewithinsuchzones.

See:MarwanKardooshandRiadalKhouri,QualifyingIndustrialZonesandSustainableDevelopmentinJordan,

DraftPaper(2004).486 ManyoftheseestateshadbeenestablishedunderHussein’sleadershipduringthe1980sand1990.487 Infrastructurewithinthesespecialzoneswasalsoprovidedbythestate.

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Foranumberofreasons,theQIZmodeleventuallyfadedintoobsolescence.Some

concernedtheenduringpoliticalthorninessofthepeaceprocesswithIsrael,whichmade

JordanianfirmsreluctanttopartnerwithIsraelipartnerslesttheysufferapublicshamingor

domesticboycott.MoreimportantlythanthatinprecipitatingthewitheringoftheQIZs,however,

wasJordan’ssigningofitsownbilateralfreetradeagreementwiththeUnitedStatesin2000,a

dealthatalloweddomestic(andinternational)firmstoaccesstheUSmarketwithouthavingto

satisfythecomplexconditionsrelatedtojointproduction.Certainly,thespecialbenefitsthatQIZ

ABriefHistoryofJordan’sQualifyingIndustrialZones AninventionoftheOfficeoftheUSTradeRepresentative,theUSStateDepartment,andtheRegionalBusinessCouncil,QualifyingIndustrialZoneswereintroducedunderthethinkingthattheymightprovideamechanismforincentivizingeconomiccollaborationbetweenIsraelanditstwoArabpartnersinpeace:EgyptandJordan.ThearrangementwaslargelypremisedonthefactthatIsrael,unlikeJordanandEgypt,hadaccesstotheAmericanmarketbyvirtueofthefreetradeagreement(FTA)itsignedwiththeUnitedStatesin1985.UndertheQIZprogram,CongresswouldamendthisFTAsotoextendIsraeli-relatedfreetradestatustogoodsjointlygrown,produced,ormanufacturedbyIsraeliandJordanian-basedfirms.ThissamestatuswastobeextendedtogoodsjointlyproducedbetweenIsraelandtheWestBank/Gaza. Morespecifically,QIZstatusandthetarifffree,quotafreeentrytotheUnitedStatesmarketitimpliedwasdependentuponacomplexlocalcontentrequirement-basedformulawherebyJordan/Israelifirmswouldneedtocollectivelycontribute35%oftheappraisedvalueofagooduponitsexportationtotheUnitedStates.Sotoincentivizecollaborationinparticular,thisaggregatefigureof35%couldbereachedthroughoneofthreemethods,asdetailedbyKardooshandKhouri:(1)Thefirstmethodrequiredthat11.7%ofthelocalcontentrequirementbeprovidedbyJordan,7-8%fromIsrael,andthattheremaining15-16%couldbeprovidedbyJordan,Israel,theWestBank,Gaza,oreventheUnitedStates,(2)ThesecondmethodwouldgrantagoodQIZstatusifanIsraelifirmandaJordanianfirmeachcontributedatleast20%ofthetotalcostofproduction.Ascostsofproductionincludedthepaymentofwages,benefits,andevencostsrelatedtothedepreciationofcapital,itwasnotdifficultforanIsraelifirmtogettothat20%bar(givenitshigherinputprices)evenwereitonlyminimallyinvolvedinthebusinessprocess.(3)Thethirdmethod,finally,requiredsatisfyingsomenon-explicitcombinationofthecontentandproductioncost-basedcriteriaasdeterminedbytheOfficeoftheUSTradeRepresentative(KardooshandKhouri,12-14). Asan(ultimatelyinsufficient)attempttolegislateagainsttheQIZsbeinginstrumentalizedasamechanismforre-exportation,meanwhile,thisarrangementalsostipulatedthatgarmentsandapparelwouldonlyqualifyforQIZstatusweretheirimportedinputssubjectedtotwo“substantialtransformations.”Thoughthismightsoundsignificant,thecuttingandsewingofimportedfabricswouldqualifyastwosuchtransformations(KardooshandKhouri,p.13).

239

statusprovidedvis-a-vislocalcontentrequirements,transformationrequirements,and

productioncostsretainedtheirattractivenessforthere-exportationbusiness.Thatsaid,once

Jordanitselfacquiredindependenttarifffree,customsfree,quotafreeaccesstotheUnitedStates

market—andoncenewinvestmentlawswerepassedsotoextendQIZ-basedsubsidiesandtax

exemptionsintospecialeconomicanddevelopmentzones488—,thosebenefitswerenolonger

quitesospecial.By2012,onlyonequalifyingindustrialzone(inIrbid)wasstillinoperation.

*GraphsprovidedbyRoyalScientificSocietyofJordanandtheFriedrichEbert-StiftungAmmanOffice,TheFutureofJordan’sQualifiedIndustrialZones,Report:2013(p.11)

488 Atthetimeofwriting,therearesixPublicFreeZonesinoperations,thirty-sevenindividualfirmsthathavebeen

grantedthelegalstatus(andstatebenefitscommensuratetothatstatus)ofPrivateFreeZones,andtwogovernmentowneddevelopmentzones(TheDeadSeaDevelopmentZoneandtheAjloun-alSuwwanZone)inoperation.

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Regardsthatnewlegislation,InvestmentLawNo.30of2014largelyreavowedand

reinstatedtheEPZ-centerednon-conditionalsystemofbenefitsandincentivesonceofferedfirms

withintheQIZs.489Theonlysignificantdifferenceintroducedbythenewlawwastheremovalof

requirementsrelatedtoIsraelipartnersandtheextensionofthesebenefitsintofreshlycoined

SpecialFreeZonesandSpecialDevelopmentZones.Forthosefirmsoperatingwithindesignated

FreeZones,thelawexemptedprofitsgeneratedfromexport-basedandintra-zoneeconomic

activitiesfromincometax;exemptedthesalariesandbonusesofnon-Jordanianstafffromincome

andsocialsservicetax;exemptedthecommoditiesimportedintoandoutofthezonesfromtaxes

andfees;exemptedthebuildingsandconstructionserectedonthelandtheFreeZonefromland

andpropertytax;andremovedallrestrictionsontherepatriationofprofitsandcapital.490Those

firmsoperatingwithintheDevelopmentZones,meanwhile,areaffordeda5%taxrate;an

exemptiononsalestaxforallinputs;exemptionsoncustomsdutiesforallinputs;exemptionson

taxesrelatedtosocialsecurityanddividends;andtheopportunitytobothsignlandleasesofup

toninetyyearsandtoacquirecriticalinfrastructurethroughbuild-operate-transferagreements

(aswasthecasewiththeAirport).491Thesebenefitswereprovidedregardlessofwhetherthe

respectivespecialordevelopmentzonewasprivatelyorpubliclyoperated.

489 BoththeFreeandDevelopmentZonesaregovernedandadministeredbytheJordanianFreeandDevelopment

ZonesBoardofDirectors.490 Inaddition,thosefirmsengagedinindustrialprojectswerealsoofferedanumberofspecialtaxexemptions.491 Forfulldetails,see:

http://www.jfdz.jo/inner/inneren.html?path=BusinessEstablishment&page=Exemptionsincentives_en

241

WhetherspeakingoftheQIZ-eraofthecontemporarySPZ/SDZ-era,theresultsbornefrom

thestate’slaissez-faire,exportprocessingzone-basedindustrialpolicieshavebeenpredictableif

neverthelesstragic.Tobegin,foralleffectsandpurposes,eachversionoftheseEPZshas

functionedprimarilysotofacilitateSouthAsianfirms’re-exportationoflow-sophistication

garments.492ThisissoeveninthecaseofthoseEPZsthathavebeenexplicitlystyledas

492 HavingfoundthemselveslockedoutoftheAmericangarmentsmarketduetoquotasandanti-dumpingrules

(especiallyfollowingthelongdelayedimplementationoftheMultifiberAgreementin2005),Jordan’sEPZswereamajorlifesaverforsuchfirms.

Laissez Faire Industrial Policy and Export Processing Zones Under Abdullah Mostgenerallyspeaking,theJordanianpolicyelitehasapproachedquestionsofindustrialpolicyinamannerlargelyinkeepingwiththemodelsandtheoriesadvocatedforattheWorldBank.LikeBankeconomists,Jordanianplannershaveconsistentlyassertedthatpolicyfailureisbothendemicandimmanenttoanystateinterventionthatisprotectionist,vertical,orpriceaffectinginnature(see:MinistryofPlanningandInternationalCooperation,TheNationalSocialandEconomicDevelopmentPlan,p.198);thisbeingthecase,theyhavealsoassumedthatpoliciesofthiskindwouldgeneratelevelsofeconomicinefficiencies,corruption,andwastethatwouldunderminetheeconomy’scapacitytosuccessfullycompetewithininternationalmarkets. FollowingfromclaimscontainedintheBank’stheoreticalconstructs,JordanianplannershavealsoassumedthatFDIinflows,incombinationwithprivatedomesticinvestment,wouldbesufficienttomakeupforthe(prioritized)declineinpublicinvestmentthatwouldbeforthcomingduetofiscalconsolidation-relatedimperatives. Finally,Jordanianpolicyplanshavegenerallytendedtoassume(asmanyBankeconomistsoncedid)thatunencumbered,unrestrictedforeigndirectinvestment(FDI)inflowswilldeliver,automaticallyandbytheirownaccord,thesortoftechnologicalupgrading,knowledgetransfer,andmodernizationofindustryneededfortheJordanianeconomytosuccessfulintegrateintoglobalcircuitsofproductionandtrade.Inotherwords,theyhaveassumedthatnoconditionsneedbeplacedonthevariousformsofstateaidthatareofferedtoforeigninvestorsacrossthecountry’sexportprocessingzonesandspecialeconomiczonesinordertoinsurethatthoseactorsdo,indeed,transfertechnologies,trainlocalworkers,andengageinotherkindsofdevelopmentallybeneficialinvestment.ThisassumptionwasfundamentallymisguidedandofdisastrousconsequencefortheJordanianeconomy.

242

technologyincubators,suchastheCyberCityITPark.Byconsequence,thecomplexityofJordan’s

exportbaskethasactuallydeclinedduetothestate’slaissezfaireindustrialpolicies,whichgoesa

longwaytowardsexplainingthecountry’sworseningtermsoftradeunderAbdullah.Whatis

more,byvirtueofthefactthatSouthAsianinvestmentintoJordan’sEPZsisfootlooseandnon-

capitalintensiveinnature—andbyvirtueofthefactthatthisinvestmentisallocatinginto

sunsettingindustriesthatoperateaccordingtotraditional,lowskillmanufacturingtechniques—,

theEPZshavealsoprovidedlittleinthewayoftechnologytransferandhumancapital

development.493

Inaddition,asthetermsoftheinvestmentlawsdescribedearlierexemptindustrialinputs

fromcustoms’duties,itisalsoworthnotingthattheforeigngarmentmanufacturerswho

populatetheEPZshavehadnoneedtobuildupwardanddownwardlinkagestodomestic

suppliersandmanufacturers.494Thisbeingthecase,theirbusinesses—andtheEPZecosystem

Someevidenceofthepreponderanceofre-exportation,atthepeakofitsoperations,theJordanDepartmentof

Statisticsestimatedthatintermediateimports(i.e.importedinputs)constituted58.5%ofthetotalvalueofgoodsbeingexportedfromtheal-DulaylQIZ.

493 RoyalScientificSocietyetal(2013),pp.23-24.494 RoyalScientificSocietyetal(2013),pp.21-22. GiventhatJordan,unlikeEgypt,isnotaproducerofanyoftheinputs(likecotton)thatthisgarmentbased-trade

reliesupon,therewasnevergoingtobemuchopportunityforbuildingverticalintegrationtothedomesticeconomy.

Whatisworse,however,byvirtueofthefactthatJordan’sendogenousresourcebase(i.e.itslackofcotton)itself

wastherebyinsufficientforattractingandretainingthiskindofinvestment,theonlywaytokeepgarmentmanufacturinginJordanwastocontinuesubsidizinginfrastructure,tocontinuegrantingtaxexemptions,andtocontinueprovisioningaccesstotheUSmarket(FutureofJordan’sQIZs,p.7).Asaresult,theQIZ-basedindustrialstrategyallowedSouthAsianfootlooseinvestmentincredibleleverage,asallthesefirmseverneededtodowastoalludetotheprospectofcapitalflight(toEgypt,perhaps)inordertoensurethattheJordaniangovernmentwouldrenewthesesubsidiesandtaxexemptions(andtoensurethatitwouldcontinuetolargelyignorethelaborabusethatwassorampantinthosefirms’factories).

243

moregenerally—havebeenallowedtoremainwhollydisarticulatedfromtherestofthedomestic

economyacrossthedurationoftheirtimeinJordan,therebygeneratingnexttonothingwhenit

cametoindirectpositiveexternalitiesaswell.Tomakemattersevenworse,thelow

sophisticationmanufacturingenterprisesthatdominatethemajorityofJordan’sEPZsalso

employexceedinglyfewJordanians—andsubjectthehandfulofJordanianstheydoemployto

extremelylowwagesandpoorworkingconditions.495Intheaggregatethen,apartfromsecuring

healthyprofitsforinternationalallies(allies,itshouldbesaid,whoimmediatelyandfreely

repatriatetheircapital),theeconomicandsocialcontributionoftheregime’sEPZ-based

industrialpoliciesiseffectivelynegligible.Whenoneconsidersopportunitycost,laissezfaire

industrialpolicylikelytakesmorefromthetablethanitadds.Todate,thesezoneshaveyielded

virtuallynothinginthewaysoftechnologicaltransfers,industrialupgrading,forwardor

backwardlinkagestootherpartsoftheeconomy,clusteringeffects,andtaxrevenues,andhave

degradedthediversityorsophisticationofthecountry’sexportbasketaswell.496

495 Indeed,despitetheMinistryofLaboritselffinancingthetrainingoflocalworkers—apolicyundertakenwiththe

hopethatJordanianswouldfillthelow-skilljobsonofferbythesegarmentmanufacturers—littleprogresswaseverultimatelymadeinthedomainofdomestically-orientedjobcreation.ThiswasbecausesimultaneoustoMoLsefforts,thestatewasexpeditingthegrantingofworkvisasforforeignworkersattherequestofthegarmentmanufacturers,whopreferredtoimporttheirworkforceasmuchastheydidtheirinputs.ForthoseJordaniansthatwereluckyenoughtosecureajob,moreover,apopulationthatwasdisproportionatelyfemale,theywouldbebeaffordedabusiveworkingconditions,negligibleopportunitiesforupwardmobility,and“non-existent”skilldevelopmentfortheirtrouble.

496 See:KardooshandalKhouri(2004),pp.4-7;RoyalScientificSocietyetal(2013),pp.12-13;JomanaAmara,

“Militaryindustrializationandeconomicdevelopment:Jordan’sdefenseindustry”,ReviewofFinancialEconomics(17),2008,pp.136-140.

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QIZPerformance:JobCreationandExportSophistication497

Ifanunmitigateddevelopmentalfailure,oneshouldnotnecessarilygoontoassumethat

theregime’slaissez-faireindustrialpolicieshavethereforecontributednothingtothe

stabilizationofJordan’scapitalismofcrisis.Tothecontrary,Ibelievethesepolicieshavehelped

consolidatethisaccumulation(andthewiderSSAthatinstitutionalizesit)intwodistinctways.

First,Jordan’sexportprocessingzoneshaveunambiguouslyexpedited(andsubsidized)profits

foranumberofregimeallies.Ofthesematerialbeneficiaries,oneneedconsidertherent-

extractingadministratorsandboardmembersthatoverseetheconstellationofspecialeconomic

anddevelopmentzonesinoperationinthecontemporaryperiodasmuchasthegarmentfirms

usingtheEPZstore-exporttheirproductintotheUnitedStates.Regardlessofthelong-term,

developmentallydestructivenatureoftheprofitsandrentsthatalltheseactorsareclaiming,in

theshort-term,theykeeptheeconomyturningoverwhilealsointegratingnewnetworksof

497 GraphsprovidedbyRoyalScientificSocietyetal(2013),pp.12-13

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economicactorsintoarelationshipofco-dependencyvis-a-vistheHashemiteregime.Second,

oneneedalsoacknowledgetheideologicaleffectgeneratedbythestate’slaissezfaireindustrial

policies.Notwithstandingthedeficienciesandstructuralnaivetethatareessentialtothelaissez

fairepoliciesjustdescribed,theyareneverthelessdrawndirectlyfromthecollectivecommon

senseoftheinternationaldevelopmentcommunity.Byimplementingthem,then,theregimeis

abletoperformitsideologicalproprietyfortheinternationalcommunity.Therebyhelpingensure

thatAbdullahetalstayinthegoodgracesofJordan’svariouspatronsandcreditors—actorswho

canthenbecountedontostepinwithcapitalinjectionswhenevertheeconomy’sflirtationswith

crisisdrifttoofar—,theideologicalfruitsoftheselaissezfaireindustrialpoliciesalsohelps

stabilizethewiderSSA,ifindirectlyso.

246

ANeoliberalMilitaryIndustrialComplex

Lastbuthardlyleastamongstthestate/Palace’selite-orientedinterventionsinthe

economyareitseffortsinbuildinga(neoliberal)militaryindustrialcomplex.Whileitshouldbe

acknowledgedattheoutsetthatthemilitary’sfirstforaysintocommercialpracticesactually

precededthecoronationofAbdullah,itwasthecurrentKing’sactivepromotionofmilitary

OmarRazzazandJordan’sExportProcessingZones TheissuesbasictotheseexportprocessingzoneshavenotgoneunnoticedbyallJordan’spolicyplanners.WhatIcallthecountry’sneoliberalleft—asegmentofthepolicyeliteledbyOmarRazzaz,thePrimeMinisteratthetimeofwriting—hasinfactbeenquitecriticalofEPZ-basedindustrialpolicy.Razzaz’sNationalEmploymentStrategy:2011-2020,writtenwhilehewasworkingattheMinistryofLabor,subjectsthesepoliciestoawitheringcritique. Censuringthegovernment’senclave-centeredregimeofinvestmentincentives,taxholidaysandtaxexemptionsaswhollycounterproductive,thisdocumentarguesthatthelowvalueindustriessupportedintheenclavesgeneratelittlejobcreationandTFPgains,whilealsopointingoutthefollyinherenttothisstrategy’ssupportforfirmsthatcompetenotonthebasisofproductivityandinnovationbutinsteadonthebasisofimplicitsubsidies(i.e.taxbreaksaswellassubsidiesonwater,land,andenergy),artificialcostadvantages,andthetemporaryspecialtreatmentaffordedthemincertainforeignmarkets(inthecaseofgarmentsandtheUnitedStates).DemonstratingthatthefirmssupportedintheQIZsandSEZsreceiveanotherimplicitsubsidythroughtheirabilitytoaccesscheap,unskilledforeignlabor—thegarmentindustrywasevenaffordedanexemptiontotheincreaseintheminimumwagethathadbeenlegislatedin2007(Nesheiwat,p.385)--,theauthorsalsodirectlyconnectthesemisguidedindustrialpoliciestotheenduringjobscrisisfacingJordaniancitizens.Implicatingtheenclave-basedindustrialstrategyinJordan’swiderfailuretotransitiontoaknowledgeeconomyaswell,theauthorsmakethecasethatthestate’ssupportforthesefirms,inconjunctionwithitsinabilityorunwillingnesstonurtureenterprisesthatgeneratehigh-skilljobs,hasactuallyimpliedadegradationofthecountry’shumancapitalstock:Jordan’screativeclassisforcedtoheadtotheGulfinsearchofworkwhilelowskilledlaborflowsinfromEgyptanddepressesthebottomendofthewagestructureevenfurther(seep.46-48,60-61,85).Whilethedocumentcallsforachangeinpolicy—thoughacceptingthatJordan’soptionsarerestrictedbythestate’slimitedfiscalspaceaswellasbytherestrictionsincumbentuponsmallopeneconomiesmoregenerally,followingRodrik,Chang,andmanyothers,NationalEmploymentstillcallsforstateinterventionswellbeyondwhatissanctionedbytheBank,stumpingforgovernmentmeasurestohelppushinvestmentintoR+DandmeasurestohelpJordandefyitsstaticcomparativeadvantage—andthoughitmakesreferencetocorporatist,bottom-upindustrialpolicy,itprecipitatedlittlechangeinthestate’sapproach.Indeed,despitethesecritiques—anddespiteRazzazhimselfbeingnamedPrimeMinisterin2018—thestate’sEPZbasedindustrialpolicyrunsthesameasitalwayshas.

247

entrepreneurialismthatisalmostentirelyresponsibleforthisindustrialcomplex’ssprawling

contemporaryform.498

Institutionally,Abdullah’smilitarizedindustrialpolicytookshapebeginningin1999and

upontheestablishmentoftheKingAbdullahIIDesignandDevelopmentBureau(KADDB).

Chargedwithproviding“acatalystforthecreationofanindependent,sustainable,defense

industrialbase”,theKADDBisorganizedasanautonomous,opaque,andPalace-alignedentity

operatingbothwithinandoutsideofthestate.499TheKADDB’sBoardofDirectors—ledbythe

ChairmanoftheJointChiefsofStaff—,forinstance,reportsdirectlytotheKing’sprivateoffices;it

financesitsautonomousoperations,meanwhile,bydrawinguponbothearnedincomeand

specialallocationsearmarkedfromwithintheJordanianArmedForce’sannualbudget.500

Initially,theKADDB’soperationswereseparatedacrosstwoindependentbusinessgroups.

Thefirst,theEngineeringGroup,wastaskedwithdevelopingtechnologiesandproductstobe

solddomestically(i.e.backtotheJordanianArmedforces)andinternationally.Thesecond,the

CommercialOperationsGroup,wasdelegatedthetaskofmarketingandsales.Whilethesetwo

groupsweresuccessfulinbuildingoutthefoundationsoftheKADDB’sbusiness,itwasnotuntil

theemergenceoftheKADDBInvestmentGroupafewyearslaterthatAbdullah’smilitary

498 AsAmara(2008)hasdocumented,thefoundationofthemilitaryasabusinessactorcanbetracedtothe

establishmentoftheRoyalMaintenanceCorporations(RMC)intheearly1990s.“Chargedwithmaintenance,overhaul,andlimitedupgradesofequipment”,theRMCprimarilyengagedinlowleveldesignandrepairandworkedprimarilywitharmoredvehiclesandpersonnelcarriers(p.141).

499 See:ShanaMarshall,“Jordan’smilitary-industrialcomplexandtheMiddleEast’snewmodelarmy,MiddleEast

Report(267),2013,pp.43. TheabovequotewasonegivenbyShadiMajali,formerChairmanoftheKADDB.500 Formoredetails,see:Amara(2008),p.141

248

industrialcomplexacquireditscurrentscaleanddiversityofoperations.501Swiftlyfollowingthe

InvestmentGroup’sarrivalonthescene,morethanfifteenjointventureswouldbeagreedtowith

avarietyofdomesticandforeignpartners.Amongstthemostrelevantofitsinternational

partners,theKADDBhasdevelopedparticularlycloserelationshipswiththeUAE-basedBinJabr

group,oneoftheMiddleEast’slargestarmsdealers.502

Acrossitsexpansionandconsolidation,theKADDBhasreceivedconsiderablestate

support.Beyondbenefitingfrompreferentialtreatmentinthemilitary’sprocurementprocess

andinadditiontothepublic’sfinancingofitsmarketingeffortsanditsbiannualdefense

exhibition(SOFEX),KADDBaffiliatedbusinessesarealsoaffordedthesameseriesoftax

exemptionsandsubsidiesasareprovidedinJordan’sSpecialEconomicZones.Whenitcomesto

theBureauitself,moreover,itsoperationsarelocatedinanIndustrialParkwhoseinfrastructure

hasbeenfinancedthroughthestatecoffersandwhosevariouslaboratoriesandtestingfacilities

arealsosubsidizedbythedefensebudget.503

501 Ibid502 Marshall(2013),p.43503 Marshall(2013),p.44.

249

KADDB’sJointVentures(2008)504

504 TableprovidedbyAmara(2008),p.140.

250

RegardingtheeconomiceffectsofthePalace’smilitarizedindustrialpolicyefforts,one

wouldhavetoacknowledgethattheKADDBhasgeneratedconsiderabletechnologicaltransfers,

particularlyinthedomainofIT.505Thatsaid,asistypicalforallmilitary-basedeffortsofthiskind,

505 See:Amara(2008),p.143. Withthepost-ArabUprisingsperiodseeingapartialmovementfromautocrat-ledregionalconflict—andthe

heavyweaponryneededforwagingsuchconflicts—toautocrat-leddomesticrepressionoperations,thedemandforsurveillanceequipment,riotcontrolequipmentandthelikehavegrownconsiderably.Havingtransitionedtoagreaterfocusongoodsandservicesrelatedtointernalpolicinginrecentyears,KADDBhascapitalizedonthese

TheKADDBandOffsetAgreements GiventhatmuchofJordan’smilitarybudgetis,foralleffectsandpurposes,giftedbytheUnitedStates,inbuildingitsminiempire,theKADDBhashadlessopportunitiesforarrangingoffsettingagreementswithitsmilitarysuppliersthanistypical.AprinciplethatwouldbewellappliedinJordan’sotherindustrialplanningventures,offsetsconditionaprocurementcontractwithaforeignarmscorporationonsaidcorporation’sestablishmentofcollaborative,jointinvestmentswiththehostcountry.Inotherwords,inexchangeforsellingJordan’sArmedForcesF-16fighterjets,aforeignfirmwouldneedtooffsetthesecostsbyalsosettingupcollaborativemanufacturingprojectswithJordan’sfledglingmilitaryindustrialcomplex(Marshall,42). WhileithasnotbeenpossibleforJordantolegislateoffsetsasauniversalconditionfordoingbusinessinthemilitary/securitysector,andwhileestablishingsucharrangementsisnotpossibleinthecaseofcontractswithUS-basedcompanies—themoneypayingforsaidcontractshascomefromUStaxpayersinthefirstplace;itwouldbepoliticallyunfeasibletoimposeconditionsonthosefirmsasaresult—thePalacehasnonethelessbeenabletoleveragebothitshealthy,US-financedmilitarybudgetandthecountry’saccessandproximitytomanyoftheregion’sreactionarymonarchiessotoinducenon-Americanfirmsintooffsettingstyledagreements.Theseagreementshavetypicallyoperatedinthefollowingmanner:inexchangeforprocuringacontractforthesaleofF-16sorKA-226HelicopterstotheJordaniangovernment,thefirmwinningsaidcontractagreestoestablishin-country,jointlyoperatedmaintenancefacilitiesforthoseproducts(Ibid).Bythesemeans,asof2013,KADDB’sjointventureswithforeignpartnersalonehadgrowntotwenty-six(Ibid).

251

ithasfailedtodeliveranythinginthewayofbackwardorforwardlinkagesvis-a-visthecivilian

economy.Thoughthismaypartiallybeafunctionofthecountry’snarrowindustrialbase,itis

problematicallthesame,especiallygiventheconsiderablepublicinvestmentofresourcesthat

havegoneintotheKADDB.LikeisthecasewithJordan’slaissezfaireindustrialpolicies,the

KADDBhasalsohadanegligibleimpactwhenitcomestojobcreation.Thoughprovidingwell-

paidworkopportunitiesforthatsegmentofthemilitary’workforcethatishighinskilland

education,asof2005,theKADDBhadjust1300peopleonitspayroll.506Finally,oneneedalso

notethatthegovernment’soutlaysontheKADDB’sbudgethavegeneratedasmallereffecton

GDPthanhaveconsumption-orientedformsofgovernmentspending.507

TurningtotheKADDB’selite-orientedeffects,however,oneseesafardifferentpicture.

GrantedprivilegedstandingastheJordanianArmedForce’sweaponsdealerofchoice,insulated

fromoversight,andsubsidizedbytaxpayers,theBureauhasunsurprisinglyprovidedanoutlet

forrentseekingamongstthemilitary’seducated,skilled,andideologicallyneoliberal.Ithasalso

givenhosttolessobliqueformsofcorruption.AhandfulofmembersfromtheKADDBboardof

directors,forinstance,havebeenchargedwithextractingkickbacksfromthevariousjoint

venturesthattheBureauoversees.Allegationsthatrevenuesmeanttofinancemilitarypensions

shiftingtradewindsandmovedtowardstheproductionofthesekindoftechnologicallysophisticatedproductsinparticular.

506 Ibid,p.142507 Thistooiskeepingwithexpectationsofthosewhohavestudiedmilitaryindustrializationwithindeveloping

countries.Suchresearchershaveaccumulatedsignificantempiricalevidenceshowingthatdefenseexpendituresexertasignificantlysmallereffectongrowthandjobcreationthandoconsumption-orientedformsofspending,regardlessoftheshortcomingsthatarebasictothelatterformofexpendituresaswell.

See:JurgenBrauerandJohnTepperMarlin,“Convertingresourcesfrommilitarytonon-militaryuses”,JournalofEconomicPerspectives(6:4),1992,pp.145-164.

252

andwageraiseshavebeenredirectedintothepocketsofindividualofficersassociatedwiththe

KADDB’sleadershiphavealsobeenleveled.508Thissecondallegation,infact,playedasignificant

roleinprecipitatingtherevoltofthemilitaryveteransin2011.AkramAbuHamdan,acloseally

oftheKing,hasbeenimplicatedinmuchofthis,ashastheformerChairmanShadiMajali.509

Mawared

IhavealreadyintroducedthesecondwingoftheJordanianmilitaryindustrialcomplex

(andsomeofthisorganization’sdepravities)inthecontextofthepreviouschapter.Torecap,

Mawared—ortheNationalResourcesInvestmentandDevelopmentCorporation—,asister

projectcalledtheDevelopmentandInvestmentProjectsFund(DIP),andathirdplanningbody

namedtheUrbanWorkshopwerealllegallyestablishedaspartofthemassacreofprovisional

legislationthattheKingetaldictatedduringthefirstyearsofthenewmillenium.Thougheachof

theseneworganizationswasnominallyplacedunderthejurisdictionofthealreadyautonomous

KADDB,inpractice,theywerealltobepersonallydirectedbytheaforementionedAkramAbu

Hamdan,whowashimselfacloseassociateoftheKing.510MuchliketheKADDB,Mawaredwas

thereforeapetprojectoftheKingandhisRoyalCourtfromtheverystart.UnliketheKADDB,

508 Formoreonthis,see:Al-ArabNewsEditorialStaff,“BigcorruptioninMawared...whythefearthatcorruptionwill

implicatethegovernment”,January27,2012.Availableat:http://www.alarrabnews.com/newsView.php?id=34278

509 Debruyne(2013),p.247510 Ibid

253

however,thissecondautonomousentitywasconjurednotforthepurposeofarmsproductionand

distribution,butrather,forthepurposeofimplementinganumberofurbandevelopment

projectsthenbeingplannedforinAqaba,Amman,Zarqa,andattheDeadSea.Havingbeen

unilaterallyassignedthelegaltitlesforvastswathsofpubliclandpreviouslydesignatedasarmy

sites,Mawaredunsurprisinglyexertedagreatdealofinfluenceonthedirectiontheseprojects

took.

IhavealreadydiscussedthenatureofMawared’soperationsandbusinessinthecontext

ofAmman’surbanrenewalaswellasinthecontextofAqaba’sspeculativeboom.Mostsimplyput,

theorganization’sbusinessmodelhingesonitscapacitytoexchangepubliclandspreviouslyused

formilitarypurposesforastakeintheprivatedevelopmentsthataretobesubsequentlybuilton

thoselands.HowMawaredcametoholdthelegaldeedsforthesepubliclandsinthefirstplace,of

course,ishighlysuspect.Regardless,throughtheseexchanges,theorganizationhasbeenableto

insinuateitselfintotheracketandspeculationdrivingthetransformationofJordan’sbuilt

environment—andthetransformationofJordaniancapitalismaswell.511

MawaredwascapitalizedontheLuxemburgstockexchangeatavaluationof$1billionin

2007.FollowingthemanyscandalswithASEZAandNewAbdaliduringthe2008-2011period,

however,thecompanyreturnedtoprivateownership.512Itschairmanatthetimeofwritingis

BishirJardaneh,andtherestofitsboardofdirectorssimilarlyreadsasalistoftheneoliberal,

511 Ibid,p.320512 Similarly,whiletheaforementionedDIPFundhadpreviouslytradedontheLondonstockexchange,ittooisno

longerlistedthere,anditswebsiteisnolongerinoperation.

254

Palace-affiliatedmilitaryelite.513Despitebeingplaguedbycredibleandobviouschargesof

corruptionfromthestart—andthoughIhavepreviouslydetailedhowthelargerreal-estate

basedgriftbeingperpetuatedbythePalace,Mawared,andthetransnationalcapitalelitecameto

beoneoftheprincipalgrievancesdrivingtheprotestsof2011—,tothisday,Mawaredremains

oneofthelargestrealestatecompaniesinthecountry.

Conclusion

Iftheinstitutionalizationofaninsulated,elite-dominatedmodalityofpoliticsand

policymakinglaiddownthejuridicalfoundationsforcontemporaryJordaniancapitalism,the

institutionalizationofveryparticularformsofmass-orientedandelite-orientedstate

interventionintheeconomyfunctionedsotobulwarkthosefoundations.Materiallyarticulating

andsubstantiatingthemisguidedideasandstrategiesthatwereinitiallydevelopedinthepolitical

domainoftheSSA,thissystemofeconomicinterventionismconsolidatesanddeepensthecrisis

tendenciesandclassbiasesofcapitalaccumulationtoday.

AsIhopethischapterhasmadeclear,fromtax,fiscal,andwelfarepolicytoindustrialand

investmentpolicy,Abdullah’sinterventionismhasrewiredmanyofthestabilizationmechanisms

thathadpreviouslyheldsocietyandpoliticaleconomytogetherunderhisfather.Whilethe

currentsystemofinterventiondoesexhibitsomestabilizingproperties—specifically,through

generatingsuitableprofitsforatransnationaleliteand,toalesserextent,throughprovidinga

513 Fortheinstitution’sleadership,see:https://mawared.jo/Pages/viewpage.aspx?pageID=28

255

basiclevelofwelfareforcertainelementswithintheworkingclass—,theyarefarlessefficacious

thanthoseinplaceduringthe1973-1986period.Due,inparticular,totheretreat(bothin

magnitudeandreach)ofthestate’smass-orientedinterventions,millionsofJordaniansnowlead

highlyprecariouslives.Withlittlerecoursevis-a-visthestate—whetherinregardsto

employmentoraccesstoasocialsafetynet—,thisprecariousnessinturninjectsabasic,

inalienablelevelofvolatilityintothewiderSSAtoday.Whilesocialcontrolstrategiesand

ideologicalinterventionsaretypicallysufficientinensuringthatthisvolatilitydoesnottranslate

intofullyrealizedsocialupheaval,theycannotreducetheriskofexistential-typechallengestothe

politicalsystem(orthesystemofcapitalaccumulation)downtozero.Solongastheselevelsof

deprivationanduncertaintyremainashighastheyare,then,fragilitywillremaininternalto

whateverformofstabilitymighttemporarilyprevailinJordan.

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CHAPTEREIGHT

Institutionalizingoligarchy:JordanianmarketcompetitionunderAbdullah

Byvirtueoftheelite-orientedinterventionsintheeconomythatweredescribedinthe

previouschapter—inconjunction,ofcourse,withJordan’suniquehistoryofclassformation—,

thischapterwillshowhowanoligarchic,non-competitiveformofmarketcompetitionhasbeen

institutionalizedandconsolidatedunderKingAbdullah.Demonstrativeofhowthedifferent

domainsofanintegratedSSAinterpenetrateandco-imbricate,Iwilldetailhowhollowed,elite-

dominatedmarketstructuresdepriveJordaniancapitalismofdynamismandcreativeenergy—

furtherconsolidatingthecrisistendenciesoftheeconomyandfurtherundercuttinglong-term

developmentprospectsintheprocess.

MyanalysisofJordanianmarketcompetitionwillbebrokenintofoursections.Inthefirst,

Iwillreviewthemodalityofstate-capitalrelationsestablishedunderAbdullahanddiscusshow

thisrelatestotheconsolidationofJordan’soligarchicmarkets.Insectiontwo,Iwilllinkclass

historytotoday’smarketcompetition,foregroundinghowthefracturingandhierarchizingofthe

capitalistclassalsoinformssub-optimalmarketperformance.Insectionthree,Iwillbriefly

discussthefinancializationoftheeconomyandhowthehegemonyoffinancialcapitalsimilarly

contributestotheeconomy’snon-competitivemarkets.Insectionfour,finally,Iwilldisaggregate

theeconomyonasectorbysectorbasis,usingaquantitativeanalysistomapmarketstructures

anddelineatetheoligopolisticpropertiesofcontemporarycompetition.

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(1)State-CapitalandIntracapitalRelationsunderAbdullah

Despitethebesteffortsoftheinternationalcommunity,attemptsatformalizingand

rationalizingbusiness-staterelationsinJordanhaveyettocometomuch.Thoughahostof

businessassociationsweremidwifedintoexistenceduringthe1990sand2000s—associations,it

washoped,thatmightmorefairly,efficiently,andtransparentlyrepresenttheprivatesectorinits

The World Bank and Market Competition (post-Arab Uprisings) ThedearthofcompetitionevincedbyJordan’smarketeconomyhas,ofcourse,attractedagreatdealofattentionrecently.HastenedbytherupturethatwastheArabUprisings,theWorldBankinparticularhasrediscoveredSchumpeteriananalysisandputagreatemphasisonthosevariablesandprocessesimpedingmarketdrivencreativedestructionintheMiddleEast.Inthepost-2011period,analystsattheBankhaveconsistentlyexpoundedontheimplicitsubsidies,protections,andbenefitsthathadbeenofferedtopoliticallyconnectedfirmsacrossthepasttwodecadesandarguedthattheseprivilegeshaveallowedsaidfirmstodominatemarketsbasedonartificial,cost-basedadvantages.Byemptyingmarket-basedcompetitionofthecreativedestructionitrequiresinordertogeneratejobs,growth,innovation,productivitygains,andgrowth,Bankeconomistshavepositedthatthesefirms—ratherthanthepublicsectorworkersofyesteryear—weretheprimaryspoilerunderminingeconomicliberalization(see:SyedAkhtarMahmoodandMeriemAitAliSlimane,Privilege-ResistantPoliciesintheMiddleEastandNorthAfrica:MeasurementandOperationalImplications(Washington,DC:WorldBank,2018). TheBank’sevolutiononthesemattersshouldbecelebrated,offeringanindicationthattheinstitutionisbeginningtoasksomeoftherightquestionswhenitcomestodevelopmentintheglobalsouth.Nolongermystifyingtheregion’sstagnationunderneoliberalreformandnolongerpositingthisunderperformanceasafunctionofeitherlabormarketrigiditiesorofincumbentsandtheircorruptiveinfluenceonthereformprocess,Bankeconomistshaveatlonglastturnedthefocustowardscapitalitselfandthecronyistformationsithasconsolidated.Thatsaid,theBank’swritingsoncompetitivenessleaveagreatdealtobedesired.Tobegin,discussionsofcronyismhavetendedtobeframedintheabstract.Theremightbeallusionstowardsthecorruptionsoflargefirmsandtheremightbevaguecondemnationsofunnamednetworksofprivilegethatexploitpoliticalconnectionssotosecurefavors,monopolyrights,and(implicitorexplicit)subsidies;generallyinsightfulastheseremarksare,however,theystopwellshortofanynamingofnames,firms,actors,andinstitutions.GiventhatdecadesofpriorwritingsattheBankwouldleadareadertoassumethatthebigfirmsbeingcritiquedcorrespondtotheoldstateownedenterprises(anassumptionallowingtheprivatecorruptionsofquotacoterietypestoskatebyunnoticed),thisrefusaltoimplicateJordan’swestern-leaningcompradorsinthesuffocationofmarketcompetitionemptiesthediscourseofthesubstantivecontentitneeds.

258

dealingswiththestatewhilealsomorecapablypartneringwiththestateasitliberalizedthe

economyanddirecteddevelopmentpolicy—,theseorganizationshavewounduplargely

ineffectualifnotirrelevant.514

514 Zimmerman(2017),pp.153-154.

ForeignInvolvementintheConstructionofJordanianBusinessAssociations Amongstthemanyinterventionsundertakenbytheinternationalcommunity’sinpost-1989Jordan,itseffortsinorganizingJordanianbusinessassociationshavebeenoneofthemostconsistent(Zimmerman,2017,pp.153-155).Befittingtheneoliberalstylethatmoregenerallyinveststheforeigninterferenceofthiscommunityinthepresentday,boardroomactivismhasalwaysbeenpresentedasbothapoliticalandeconomicallynecessary.Havingassertedthatarobustandcohesiveprivatesectoriscapableof(andinterestedin)guidingapolicyprocesspreviouslysulliedbytheincompetenceandcorruptionofstateplannersintodirectionsconducivenotonlytocorporateinterestsbutaggregatesocialwelfare,healthybusinessassociationsare,infact,promotedassomethingofasinequanonwhenitcomestomoderndevelopment.Asthisconnectstoapoliticism,giventhemodalityoftechnocracyjustsketched,itholdsthatmobilizingandorganizingcapitalsothatitmayactasaclassforitselfisnotconceivedofasaformofpoliticalmeddlingbutasaformofeconomicsupport.Similarly,italsoholdsthatthedenigrationoflaborunions—forinstance,byceaselesslycastingthemasincumbentspecialinterestspoisedtoundermine(universallybeneficent)structuralreformsotoservetheirparticularistinterests,astheWorldBankandUSStateDepartmenthavebeenwanttodo—bedepictedasrationalist,economisticcommentary. OfalltheforeignactorsinvolvedinthebuildingofJordanianbusinessassociationsandinthequietclassprojectdescribedabove,USAidhaslikelyplayedthebiggestrole(BlueCarroll,270).Intheearlyyearsofthe1990s,itsinterventionswereprimarilyoperationalizedthroughthePrivateEnterpriseTechnicalResourcesAssistanceProject(PETRA).OfPETRA’snumerousprogramsandinterventions,it’smidwifingoftheJordanTradeAssociationandAmmanWorldTradeCenterbestepitomizethesubjectmaterialbeingdiscussedatpresent.Asofthelate1990s,PETRAwouldbesucceededbyasecondUSAidprogramtitledtheAchievementofMarket-FriendlyInitiativesandResults,orAMIR.Dispensing$946,000totheAmmanChamberofCommerce,theAmmanChamberofIndustry,theAmmanWorldTradeCenter,theBusinessandProfessionalWomenClub,theJordanTradeAssociation,andtheYoungEntrepreneur’sAssociation,itcouldbearguedthatAMIR’sfinancialresourcesunderwrotewhatlimitedachievementswereseenintheformalizationofbusinesslobbyingduringtheseyears(BlueCarroll,2001,pp.243,270-271).InadditiontoAid’scontributions,finally,itisworthnotingthattheWorldBankhelpedfundandorganizetheJordanEconomicDevelopmentAssociation,athinktank-lobbyingfirmdesignatedtopushtheliberalizationagendaaswell.

259

Thegenealogyofthesefailuresinformalizationtracesbacktomuchearlierprocessesof

classandstateformation.Ashasbeendetailed,theseprocessesallowedanelitefractionofthe

Jordanianbourgeoisietoestablishandsubsequentlymaintainahegemonicintraclassposition

acrossthedecades.UponAbdullah’sascendancytothethrone,thispositionwasusedto

reconsolidateinformalchannelsofcommunicationandlobbying—channelsconnectingthese

individualsdirectlytothePalaceanditseconomizedpoliticaleliteandchannelswhich,ipsofacto,

renderedformalizationeffortsimmediatelyhollow.515Beyondundercuttingformalizationinthis

manner,itshouldbenotedthatJordan’soldmoneyalsomanagedtoestablishcontroloverthose

formalbusinessassociationsthatdidachieveamodicumofinfluencewithinthepolicyplanning

processduringtheliberalizationperiod.FirstamongsttheseorganizationsistheJordan

Businessmen’sAssociation(JBA).Atthetimeofwriting,HamdiTaba’a(Sr.),scionofthecountry’s

traditionaleconomicelite,isPresidentoftheJBA.TheAssociation’sboard(inclusiveofhonorary

515 Formoreonthis,see:Moore(2004),BlueCarroll(2001),Chapters5-11. BusinessmenlockedoutoftheformalandinformalnetworksandorganizationsthroughwhichtheAmmanielite

articulatetheirdemandshaveattemptedtomobilizetheircollectiveintereststhroughestablishingbothregionalchambersandsector-specificsyndicates.ThemostrelevantoftheseregionalbodiesaretheIrbidChamberofCommerce(http://www.icc.org.jo/index.php?l=en&pg=T1VSIENIQU1CRVI=),theZarqaChamberofCommerce(http://www.zarqachamber.org/index.php?lang=ar),andtheAqabaChamberofCommerce;Rusaifeh,AlSalt,Jerash,Ramtha,alKarak,Ma’an,Ajloun,Mafraq,andMadaba’srespectiveChambersofCommerceareallmorelocalinnature.

Asregardsthesyndicates—thevastmajorityofwhichparticipateintheAmmanChamberofCommerce—smaller

associationsandorganizationssuchastheGeneralAssociationforFoodstufsMerchantsandtheGeneralSyndicateofofProprietorsofGoldsmithandJewelryTradeFirmsengagemostlyinsingleissue,relativelyineffectuallobbying.ThemoresociallyconservativeandIslamist-leaningwithinthisexcludedfractionhaveoptedtomobilizetheirownlobbyingorganizationthroughtheBusinessmen’sProsperityAssociation.Similarlyhometosmallscaleindustrialistsandpetitebourgeoismerchantsofdifferentstripes,thisAssociationtoohasconsolidatedlittleinfluenceamongsteitherdomesticpolicymakersorforeigncapital.Unabletoaccessorinfluencethehallsofpowertoanysignificantextent,theseorganizationsofthenon-elitebusinessinterestsevincethestarksegmentationofJordan’scapitalistclass,andthepowerdifferentialssuchsegmentationaffords.

260

members)featuresotherlegaciesoftheMiddleEastSupplyCompanysuchasIsamBdeir,

MohammedBilbeisi,AdnanBadran,AqelBeltaji,ZaidSha’sha’a,FouadQatan,RaoufAbuJaber,

JackKayyat,TawfiqKawar,andEliaNuqulaswell.Theelitefractionofthebourgeoisclasshas

alsotraditionallydominatedtheAmmanChamberofCommerce(ACC),theAmericanChamberof

CommerceinJordan,theJordanInsuranceFederation,andtheAssociationofBanksinJordan.516

Byvirtueoftheircontroloversuchassociations,theirsuccessesinestablishinginformal

lobbyingchannels,andtheirinfiltrationofthepolicymakingprocessitself,itcouldbearguedthat

thepoliticalandeconomicpoweroftheelitefractionoftheJordanianbourgeoisieisasgreat

todayasatanytimeinthecountry’spast.517Theirenduringeconomichegemonyismosteasily

discernedthroughareviewofthesprawling,multisector,family-ownedconglomeratesthatmany

withinthisfractionownandoperateatthetimeofwriting.Havingseenthedepthandbreadthof

thesebusinesses,itismyhopethatthereaderwillbebetterabletoseethenon-competitive,

516 Forinstance,theBoardoftheACCshowsanotherTaba’a(Tareq)inapositionofinfluence(SecondVice

Chairman);BahjatHamdan,heirofanotherelitefamily,istheACCSecretaryGeneral;NourJarrar,CEOofCitigroupandlongtimeadvisortotheRoyalHashemiteCourt,alsositsontheboard.TheboardofdirectorsfortheAmericanChamberofCommerceinJordan,meanwhile,includesthesameNourJarrarandTareqTaba’aaswellasKhaledKanaan(ofMawared),andFaresHammoudeh(oftheHammoudehfamilyagriculturalempire).

WhilefinancedbyUSAidandpromotedasaninstitutionalhomeforanti-cronyistbusinessorganizing,itisworth

pointingoutthatevenYoungEntrepreneur’sAssociationhasfrequentlypushedthesonsandyoungerbrothersofthissameclassfractionintoseniorroles.

517 Sectiononeofthisdissertationdetailedtheprocessesthroughwhichanelitemerchantclassinitially

accumulatedunprecedentedamountsofcapitalduringtheyearsofWorldWarII.ThosechaptersalsodemonstratedhowthisfractionofthecapitalistclasshasuseditswealthsotoreproduceitsprivilegedpositionwithinJordanianeconomyacrosstime.

Thishistoryendowscontemporarycapital-capitalrelationswithmanyofitsmostsalientproperties.Indeedand

asmentionedintheprevioussection,thehegemonyofoldmoneyremainstheorientingprincipleoftoday’sformofmarketcompetition.ByvirtueofthefactthatAbdullah’seconomizationofthepolicyelitehasallowedtheoldmerchantclasstowieldpowerdirectly,itcouldevenbearguedthatthisclassfraction’shegemonyhasgrowninthemodernperiod.

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oligarchicnatureofJordanianmarkets.Ishouldsayattheoutsetthatitis,ofcourse,difficultto

establishtheexactscaleandinfluenceofthesebusinesses.Astheseconglomeratesaretypically

organizedthroughasingle,privatelyheldholdingcompany—acompanyundernoobligationto

disclosedataregardingitscapitalholdings,revenuesorprofits—,onecannotsimplylook

throughthebookssotodiscovertheirmarketcapitalizationorannualrevenuestreams.

Nonetheless,asthemajorityoftheseenterprisesdoprovidegeneralinformationregardingtheir

assets,investments,andcorporatestructure518,itisstillpossibletoacquireadecentsensefor

theiroperations.

TheKawarGroup

TheKawarGroup—stewardedbyformerECCmemberKarimKawar—operatesamassive,

multisectorempire.Inshipping,transportation,andlogisticsalone,theirholdingsincludethe

AminKawar&SonsShippingandTransportationCompany,theRedSeaShippingAgency,the

AqabaShippingCompany,ManaraShipping,PacificInternationalLinesJordan,GulfAgency

Company,andMaerskJordan.InthedomainofICT,itsholdingsincludeOptimiza(atech

consultancy),IrisGuard(andirisrecognitionsoftwareusedintheUAE’sairports),andD1G(a

searchengine).TheKawarGroupalsomaintainsacontrollingstakeinAlFarisNationalCompany

forInvestment&Export,thefirstpubliclytradedICTfirmontheAmmanStockExchange.

518 Regardingstructure,itisworthnotingthatmanyoftheseholdingcompaniesdemonstratebothhorizontaland

verticalintegration.Theverticaldimension—specifically,theoperationofin-housefinanceandinsurancearms—tendstofacilitatethehorizontalone,allowingaholdingcompaniestoprovidecapitalandsecureitagainstlossacrossavastarrayofindustriesstretchingfromenergy,IT,luxuryimports,logisticsandtransportationtohealthandpharmaceuticalstorealestateandtourism-relatedinvestments.

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Ontheimportsandexportsfront,KawarInternationalservesasthefamily’sorganizing

hub.TheKawarfamilyhasalsobranchedintothehealthsector.Herein,NatHealth,awebbased

healthsystemsplatform,andAdvancedMedicalEquipmentrepresenttheirmostsignificant

assets.Moremiscellaneously,itisworthnotingthattheKawarGrouphasalsopartnereddirectly

withtheroyalfamily(morespecifically,withQueenRania)throughRubicon,aneducational

entertainmentmediacompany.Thefamilyhasalsodabbledinthehospitalityindustrywith

Crumz,ahighendbakeryandrestaurantinWestAmman;majorrealestateinvestmentsinJabal

AmmanthroughAl-AsreyahRealEstate;renewableenergythroughShamsMa’an;andin

integratedbusinesscommunicationssoftwarethroughExpress.

RancoHoldings(Mu’asherfamily)

TheMu’asherfamily’sbusinessesareprincipallyorganizedthroughRancoHoldings.519

NadimMu’asherisChairmanoftheRancoboard,andShakerMu’asheristhefirm’smanaging

partner.Atthetimeofwriting,Ranco’sinvestmentsextendacrosshospitalityandtourism,

bankingandfinancialinstitutions,industry,trade,renewableenergies,realestate,agriculture,

media,anddesign.Mostprominentamongsttheseinvestments,Rancoisastrategicshareholder

inArabInternationalHotelsCompany(owneroftheAmmanMarriot),theBusinessTourism

Company(OwneroftheJordanValley,DeaSea,andPetraMarriots),andalDawliyahforHotels&

Malls(whichistheowneroftheSheratonHotelinAmman).Itisalsoamajorshareholderin(the

519 Certainly,itshouldbesaidthattheMu’asherclandoesnotoperateasasingle,unifiedactorinthebusiness

world.Itisaverylargefamily,andthereareanumberofcompetingMu’asherenterprisesintheretailspaceinparticular.

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Kuwait-backed)AhliBankandintheJordanianInvestorCentre.Finally,Rancoholdssignificant

equityintheformerQIZ-based(nowSpecialEconomicZone-based)Ez-ZayReadyWear

ManufacturingCompanyaswellasinasecond,SEZ-basedgarmentmanufacturer.520Longoneof

thecountry’slargestlandowners,theMu’asherfamilyalsoownsandoperatesexport-oriented

citrusanddatefarms.Incommercialandresidentialrealestate,finally,Ranco’sinvestmentsare

directedthroughasubsidiarycalledAlIzdihar.

TheTalhouniGroup

Anotherlegacypropertyofaquotacoteriefamily,theeponymouslynamedTalhouniGroup

ownsandoperateseightdifferentcompaniesatthetimeofwriting.Oneofthekeyplayersin

Jordanianbigagriculture,theTalhouni’sModernFeedMillsandGroundFlourMillsofZarqaare

inthebusinessofdiversifiedcerealprocessing.521Inhospitalityandresidentialrealestate,the

Groupcontrolsfourindependententities:KnightKapital,InnovativeCreationsforInvestments,

ODDIntelligentConnectivityandOussoulInvestments.Thelatterisaprojectofoneofthe

family’syoungermembers,FarisalTalhouni,anditsportfoliotendstowardscommercialreal

estateaswellastowardsthebankingandinsurancesectors.Likealltheoldguard,theTalhouni

Groupalsoretainsafootholdintheimport/exportgamethroughNajadTrading.

Inaclassicinstanceofintrafractioncollaboration,finally,thegroup’sModernFashion

DesignoperatesasauniformproviderforallofJordan’smajorinternationalhotels,inclusiveof

520 TheJordanWorstedMillsCompany.521 Priortothecessationofthestatesubsidyonbreadin2018,thesefirmshadbeenmajorbeneficiariesofthe

state’swheatinterventionism.

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theMarriot,CrownePlaza,Kempinski,Intercontinental,Sheraton,GrandHyatt,FourSeasons,

Millenium,themajorityofwhichareownedbyanothermemberofJordan’squotacoterieclass

fraction.

AbuJaberInvestments

AbujaberInvestments,establishedin1944,representsanotherclassicinstitutionofquota

coteriecapital.Thefirmcombinesdirectholdingswithstrategicinvestmentsandhasafingerin

industriesasdisparateastelecommunications,realestate,finance,pharmaceuticals,hospitality,

andinsurance.Mostimportanttoitsportfolio,AbujaberInvestmentsholdsasignificantstakein

theAqaba-based,ASEZAoverseenTalaBayResort.Inaddition,itholdssubstantialequityin

Investbank,apubliclytradedinvestmentbank;DaralDawa,oneofthecountry’slargest

pharmaceuticalcompanies;theRadissonBluAmman;themediacorporationAudioVisualMedia;

theUnitedInsuranceCompany;aswellastheJordanPaperandCardboardFactoriesCompany.

TheMangoGroup

Formedin1927,theMangoGroupcontainsaninvestmentarmwithwiderangingstrategy

holdingsaswellasfivefullyownedsubsidiarycompanies:HIMCO,HAMCO,MangoRealEstate,

EasyStorage,andMajdal.Regardingthesubsidiaries,HIMCO,anindustrialengineeringfirm

whosebusinesshasgenerallydependedupontheprocurementofgovernment-issuedservicing

contracts,representstheoriginalcogaroundwhichtherestoftheMangofamilyconglomerate

wassubsequentlybuilt.Amongstthemanylucrativepubliccontractsthathavebeenprocuredby

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HIMCO,ithasbeendelegatedtobuildtelecommunicationssystems,toservicepowergeneration

systems,andtoprovideexcavationservicesfortheJordanPetroleumRefineryCompany,Queen

AliaInternationalAirport,theJordanCementFactoriesCompany,theJordanPhosphateMines

Company,andtheArabPotashCompany.

Secondamongstthesubsidiaries,HAMCOhasstayedwithintheparametersofhousehold

appliancemanufacturing,anotheroftheMangofamiliesoriginalfieldsofbusiness.Thethird,

EasyStorage,doespreciselywhatitsnamesuggests.Thefourth,MangoRealEstate,isprincipally

investedintotheoldbaladofAmmanandontheairportroad.Thefifth,Majdal,producesorganic

oliveoilfordomesticandinternationalmarkets.Importantly,theMangogroupalsoholdsmajor

investmentsintheLebaneseInvestmentBankSocieteGeneraleBanqueLiban;ArabBuilding

MaterialsCompany—oneofthelargestimportersofsteelandtimberinJordan—;alNisral-Arabi

(oneoftheleading,publiclytradedinsurancefirmsintheJordanianmarket);aSwedishowned

solarcellmanufacturingcompanycalledMidsummer;andamediaplatformcalledMagineTV,

whichprovidesawireless,cloudbasedtelevisionplatform.522

NuqulGroup

TheNuqulGroup,yetanotherpropertywithalineagetracingbacktothequotacoterie,

controlsthirty-oneseparatecompaniesatthetimeofwriting.Itscapitalholdingslargelyderive

fromthefamily’straditionalfieldofbusiness—paperandhygienicproducts.Atthetimeof

writing,infact,FINEHygienicHolding—oneofthelargestfirminthefacialtissue,toiletpaper,

522 Formore,see:http://www.mango-grp.com/index.php/our-investments

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kitchentowel,anddiapermarketintheMiddleEast—persistsasthecentralpillaroftheNuqul

Group’swiderbusinessempire.

ByconsequenceofGhassanNuqul’sleadership—aformermembertheEconomic

ConsultativeCouncilandaformerDirectoroftheJordanBusinessmen’sAssociation—,theGroup

isnowalsoheavilyinvestedinbanking,insurance,automobiles,andrealestate.Specificto

automobiles,NuqulAutomotiveistheexclusivedistributerforthemajorityofGerman-madecars,

includingPorsche,Audi,andVolkswagen.ItalsoholdsanimportmonopolyforSkoda.Specificto

bankingandinsurance,GhassanNuqulistheChairmanofbothCapitalBankandDeltaInsurance.

TheManaseerConglomerate

AmorerecententrantintotheJordanianeconomicelite,theJordanian-born,Russian-

educatedZiyadManaseerbuiltafortuneasaconstructionmagnatewithcloserelationsto

GazpromandRosavtodor,thefederalagencydirectingroadconstructioninRussia.523Leveraging

hiscloserelationswiththeRussianenergysector,ManaseerwentontofoundtheJordan-based

ManaseerOil&Gasin2003.Operatingatleastthansixty-eightgasstationsacrossthecountryat

thetimeofwriting,Manaseerholdsaprivilegedpositionwithinoneoftheeconomy’smostnon-

competitivesectors.

Muchliketheothermembersofthiseliteclassfraction,Manaseerhasalsoestablishedan

investmentgroup(ManaseerGroup)tofacilitatecross-sectoracquisitionsandsoto

organize/consolidateabusinessempiretouchingnearlyeveryaspectofthecontemporary

523 Hehassincesoldhissharesintheconstructionfirmhefounded(Stroygazconsulting).

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economy.Inadditiontotheoilandgasfirmdiscussedabove,theManaseerGroup’scurrent

holdingsandpropertiesextendacrossinfrastructureandbuildingmaterials524,mining525,

businesssolutions526,foodandservices527,andchemicals.528

TheSabihMasriEmpire

Finally,whilenotorganizedthroughasingleintegratedholdingcompanymodel,this

sectionwouldbeincompletewithoutabriefsurveyofSabihMasri’svastbusinessempire.Within

thebankingsector,MasriisChairmanofArabBank,thelargestprivateentityintheJordanian

economyandafirmwhichheholds11%equityin.MasriisalsoamajorshareholderintheCairo-

AmmanBankwherehisson,KhalidSabihMasri,sitsontheboardofdirectors.

Regardingthefinancialsectormoregenerally,Masriownsandoperatesoperatestwo

privateinvestmenthouses.Thefirst,theSaudi-basedArabSupplyandTrainingCompany(also

knownastheAstraGroup),mostresemblestheholdingcompaniesoftheotherbigJordanian

families.ThefoundationofMasri’spersonalbusinessempire,Astraholdseithersubstantive

524 Here,thegroup’sholdingsincludeManseerReadyMix,ManaseerIron&Steel,ManaseerFirst(cementand

concrete),ManaseerCementIndustry,theTrustforConcreteIndustriesCompany,andManaseerMarble&Granite.

525 Here,thegroup’sprincipalholdingisManaseerCrushers.526 Here,thegroup’sholdingsincludeManaseerTrade(mostlyoperatinginindustrialchemicalsandfertilizers),

ManaseerInformationTechnology,ManaseerInvest(whichcontrolsmajorityequityinthepubliclytradedAfaqHoldingforInvestmentandRealEstateDevelopmentCompany),ManaseerTransport,VisionsMaintenanceandSpareParts,ManaseerMachineryTrading,andManseerImportandExport(focusedonoilandlubricants).

527 Here,thegroup’sholdingsincludeManseerFoodIndustries(primarilyfocusedinoliveoil),ManaseerDates,and

LumiMarket(anetworkofgrocerystores).528 Here,thegroup’sholdingsincludeManaseerMagnesia,ManaseerCarbonate,andManaseerFertilizersand

Chemicals.

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equityholdingsorfullownershipincompaniesoperatingacrosstheMiddleEastandacrossthe

domainsofconstructionandmining,energy,financialservicesandinvestment,foodand

agriculture,healthcareandmedicine,realestateandhospitality,media,plastics,chemicals,steel,

telecommunications,andplastics.529Astra’sfullyownedsubsidiariesincludethefollowing

enterprises:AstraConstruction,AstraMining,Al-AnmaaforConstructionMaterials,AstraEnergy,

NourEnergy,thePalestine-centricPadicoHoldingCompany,AstraFoodCompany,GoldenWheat

MillsCompany(Ramallah),VegetableOilIndustriesCompany,JordanVegetableOilIndustries

Company(makerofal-Ghazalioliveoil),SouthAgriculturalCompany,MaisIrrigation,Rum

AgriculturalCompany,TabukPharmaceuticals,AstraHealthcareSolutions,ElKendi

Pharmaceuticals,MaisMeidicalCompany,CordobaOasisVillageCompound,AlHamraOasis

VillageCompound,AylaOasisDevelopmentCompany(Aqaba),TabukInvestmentandTourism

Company,AlAyyamPress,AstraPolymers,AgriculturalPlasticIndustrialCompany,Astrachem,Al

TanmiyaSteel,InternationalBuildingSystemsFactory,CiconBuildingMaterials,Nour

Communications,PaltelGroup(oneoftheoligopolisticfirmsinPalestinianmobiletech),andVtel.

Asonehaslikelysurmised,Astrais,then,aratherstaggering,multisectormonolithwitha

hegemonicpositionwithinnearlyeverysectorandmarketintheJordanianeconomy.

ThesecondofMasri’sprivateinvestmenthousesisal-MasiraInvestmentsCompany,afar

moreboutiquey(andopaque)operation.Publictradinginformationindicatesthatital-Masira

holds31%equityinZaraInvestmentHoldingsasof2019.RecallfromchaptersixthatZarawas

529 Inaddition,AstraholdssubstantialequityintheSaudi-basedFahadbinSultanUniversityandFahadbinSultan

Hospital.

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heavilyinvolvedintheurbanrenewalsofbothAqabaandAmman.530Bymostcalculations,itis

thelargestandmostinfluentialdeveloper/realestatespeculatorinJordantoday.

TheQuotaCoterieandtheSiliconWadi

Finally,beforeclosingontheenduringhegemonyofthiselitefractionwithintheJordanian

capitalistclass,IwouldberemisswereInottomentionhowthesesamefamilieshavealso

establishedtheircollectivedominanceovertheemergentJordaniantechscene.Indeed,not

withstandingthebootstrappingmythosandthemeritocraticairsthattechnology-based

entrepreneurialismtendstocoatitselfin,inJordan,thesearelegacyfieldsthroughandthrough.

ThearistocraticpropertiesofJordan’sICTsectorhasheldsteady,moreover,acrossbothofthe

moderntechrevolutions:thedotcomboomofthe1990sandearly2000s,andtheuberization

boomoftheearly2010s.

Specifictothefirstperiod,theprincipalprotagonistsacquiringpower,influence,and

capitalinJordanwereKarimKawar,SamihToukan,andHussamKhoury.Scionsoftheoldguard,

eachmanagedtoleverageinheritedwealth,accesstothePalace,andconnectionswith

transnationalcapitalsotoArabizeinternetbusinessesinitiallypioneeredintheUnitedStatesand

Europe—earningthemselvesmassiveprofitsintheprocess.531Therepresentativesofoldmoney

530 TheAstraGroupisamajorequityholderinZaraaswell.531 ToukanandKhoury,ofcourse,famouslyearnedhundredsofmillionsthroughthesalesofmaktoob.comtoYahoo

in2000andofsouq.comtoAmazonin2017.Atthetimeofwriting,theysteertheirownventurecapitalfirm(Jabbar)inadditiontosittingontheboardsofallthevariousentrepreneurshipbodiesbeingpromotedbythePalace.BeyondservingontheECC,asanAmbassador,asaconsultanttotheKing,andasPresidentofhisfamily’sKawarGroup,meanwhile,KarimKawarisalsoDirectorofOasis500(atech-focusedventurecapitalfirm)atthetimeofwritingaswellasbeingaboardmemberfortheOptimizaconsultancydiscussedearlier.

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havealsoreapedthebenefitsderivedthroughtheuberizationofthetechnologysector.Manyof

theseindividualsoperateoutofDubai,whichisattheheartoftheregion’sspeculative,tech-

relatedventurecapitalspace.Mostprominentamongstthem,perhaps,areKhaledTalhouniand

FaresGhandour(sonofAramexfounderandconfidanttotheKing,FadiGhandour).Thetwo

youngmenaremanagingpartnersatWamdaCapital,oneoftheforwardleaninginvestmentfirms

frequentlycelebratedbyregionalandwesternpress.Leveragingtheirinheritedwealth,Wamda

hasacquiredmajorstakesinmanyoftheMiddleEast’shottesttechproducts,includingCareem.

Thoughtheseproductsoftendemonstrationapenchantforplagiarismmorethaninnovation—

Careem,forinstance,isaridesharingserviceappmodeledcloselyonthoseofUberandLyft—,

theirpresenceintheArabmarketstillmakesthemincrediblyvaluable.WhenCareemwas

eventuallyboughtoutfor$3.1billionbyUberinMarchof2019,Wamdawalkedawaywitha

majorpiece.532

Inadditiontotheseinvestor-types,anumberofotheryoung,quotacoterie-aligned

JordanianshavealsomovedintoseniormanagerialpositionswiththeregionalofficesofUS-

basedtechcompanies.HamdiTaba’a,forinstance,whoisthegreatgrandsonofthefirstpresident

oftheAmmanChamberofCommerce,hasmanagedtoleveragerelationshipswithinthecircuits

oftransnationalcapitalsotosecurehimselfthepostofUber’sheadmanagerofbusinessinthe

Ratherabsurdlyandaswasmentionedpreviously,itwasKawarwhousedhispositionontheECCandhis

influenceoverthee-schoolREACHinitiativetosecureapreviouscompanyofhis,IdealGroup,theexclusivecontractforcomputerizingJordan’sthousandsofclassrooms.

532 Inaway,GhandourandTalhounibenefitfromabusinessthatisnotsodifferentfromtheimport-basedeconomy

theirforefatherswontheirwealththrough:bycontrollinginternalmarketsforexternallygeneratedservicesinmuchthesamewayaspreviousgenerationscontrolledinternalmarketsforexternallyproducedautomobiles,theyextractsubstantialearnings.

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LevantandGulf.533Throughsimilarprocesses,SamirAsfour,anotherlegacychild,haswoundup

Tesla’sRegionalDirectorfortheMiddleEast,GCC,andTurkey.

(3)Financialization

BeforeproceedingtomysectorbysectorquantitativemarketanalysisoftheJordanian

economy,thelastvariablethatneedstobeemphasizedinexplainingJordan’snon-competitive,

elite-dominatedformofmarketcompetitionconcernsthewiderfinancializationoftheeconomy.

Between2000and2018,thetotalfixedassetsofJordan’slicensedbankshasroughlyquadrupled,

increasingfromJD12,913milliontoJD50,893million.Whencomparedtopaltrygrowthrates

seenintheaggregate(asreflectedinnationalGDP)andatthelevelofindividualsector

performance,therelativeeffectofthisexpansionisevengreater.

533 MohamadJardaneh,anotherlegacychild—albeitoneofTransjordanian,politicalstock—,hasalsoacquireda

seniorpostwithUber.

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Thehegemonyofthefinancialsectorvis-a-vistherestoftheeconomytodaycanbeseen

throughanumberofdifferentmeasures.Ifoneweretolookatmarketcapitalizationsonthe

AmmanStockExchange,forinstance,onewouldseethatasofMarchof2019,thebankingsector

aloneconstituted58%ofaggregatecapitalization.Addinthefinancialservicescompaniesand

thatpercentagegrowsto63%.Withtheexceptionofenergysector(whichisgrossly

unprofitable),acomparisonofthebankingsector’saggregateannualincometotheaggregate

annualincomeoftheothersectorsoftheJordanianeconomyrevealsasimilarlyskewedpicture.

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DataprovidedbyAmmanStockExchange

Morenotable,perhaps,thanthebankingsector’sgeneralizeddominanceofthe

economy—financialcapitalis,afterall,ascendantacrossthevastmajorityoftheworld’s

economies—istheparticulardominanceofArabBank.Atthetimeofwriting,ArabBank’smarket

capitalizationconstitutes41.6%ofthebankingsector’stotalcapitalization,andashocking24.2%

ofthestockmarket’saggregatecapitalization.Byitssheersizealone,then,thisisanentitywhose

basicexistencerendersfreecompetitionsomethingofafarce.

WhenonesurveysArabBank’smostprominentstakeholdersaswell,itseemsvery

possiblethattheBank’smagnitudeisnottheonlyvariableexertinganti-competitioneffects.The

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Bank’sChairmanistheaforementionedSabihMasri534anditsmostsignificantequityholders

includeSaudiArabia’sMinistryofFinance;individualSaudi-basedinvestorslikeMuslimbinAli

MuslimandNasral-Rashid;institutional,state-backedinvestorsfromBahrain,theUAE,and

Qatar;theJordanianstate(asrepresentedbytheSocialSecurityCorporation’s17%equitystake);

theShomanFoundation;andahandfulofindividualsdrawnfromtheelitefractionofthe

domesticcapitalistclass.IntegratingmuchoftheHashemitecoalitionasthislistofboard

membersand/orstrategicinvestorsdoes,therearereasonsforassumingthatArabBank’s

continuedprosperitywillbeprivilegedasamatterofnationalinterest.

(4)SectoralMarketStructures

TogivesomeindicationoftheextenttowhichtheseprocesseshaveunderminedJordanian

marketcompetition,Iwillnowprovideasimple,sector-by-sectorsurveyofthecountry’smarket

structures.

Operationally,asmentionedintheintroductorypassagestothischapter,Ihavefocused

hereonpubliclytradedfirmsalone.IshouldalsomentionthatIhaveoptedtoorganizethis

analysisbydisaggregatingthevariousmarketswithintheJordanianeconomyaccordingtothe

sectorclassificationsthroughwhichtheAmmanStockExchangedividesthemarket.Asforthe

metricsusedtodetermineamarket’sstructure,Ihavemeasuredindividualfirms’annualincome

andmarketcapitalizationagainstthesector’stotalannualincomeandmarketcapitalization.By

534 Masripersonallyholdsroughly11%equityinArabBank.

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consideringbothofthesemeasures,Ibelievethisanalysiscanaccuratelyestablishthenumberof

relevantfirmswithinanygivensectorandtherelativeweight/powerofeachfirmwithinasector.

Viewedincombination,thesefiguresshouldprovideanaccuratedescriptionofthestructureand

natureofmarketcompetitionwithineachsectoroftheeconomy.

Clearly,therearesomemethodologicalproblemswithmappingsectoralmarketstructures

inthismanner.Byonlyincludingpubliclytradedfirms,forinstance,myanalysisexcludesa

numberofmultinationalcorporationsandanumberofprivatelyowneddomesticfirms,manyof

whichhaverepresentsignificantplayersinthecontemporaryeconomy.Excludingsuchfirms

constitutesaconfoundingomission.Ultimatelyhowever,itisanomissionthatisunavoidable.As

thereisnowayofgainingaccesstorevenues,assets,orprofitsdataforprivately-ownedfirms—

andasitisextremelychallengingtoisolateandparsethissamedatawhenitcomestotheJordan-

specificbusinessofmultinationalcorporationsorthosefirmstradedonforeignstock

exchanges—thereisnowayoffeasiblyandquantitativelydeterminingwhattheseactorsmarket

sharemightbewithinagivensector.Thisbeingthecase,forreasonsofmethodological

expediencemorethananalyticalinsight,Ihavehadtoproceedwithoutthem.Inaneffortto

(partially)accountfortheeffectsderivedfromtheirexclusion,inthosesectors,likemobile

communications,whereprominentprivatelyownedfirmsareofascaleastoexertamajor

influenceonthemarket,Iwillattemptanestimationoftheirmarketsharebasedonopensource

data.

Finally,beforeproceeding,Ishouldalsoacknowledgethatmysectorbysectorbreakdown

willnotreviewthemarketstructurewithinthedomainsofeducation,media,utilitiesandenergy,

paperandcardboard,printingandpackaging,andelectricalindustries.Myreasonsforexcluding

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thesesectorsaremultifold.Forsome—suchasmedia,printingandpackaging,paperand

cardboard,andtobaccoandcigarettes—,onlyoneortwofirmsarelistedontheASE.Thisbeing

thecase,thosesector’sduopolisticormonopolisticmarketstructuresareself-evident.Forothers,

suchaseducation,thebusinessbeingdoneissosmallandthenumberofactorsbeingexcluded

fromthepicturesolarge(veryfewprivateeducationalinstitutionsarepubliclytraded)that

analysisofanASE-basedmarketstructurewilldolittletoenlightenthereader.Giventhatthe

utilitiesandenergysectorsareprimarilydominatedbyregionalmonopolies(asdiscussedinthe

sectiononprivatization)andthatthesedefactomonopoliesdonotcompetewithoneanother

(apartfromintryingtowinagovernmentlicense/contract),finally,itmakeslittlesenseto

conceptualizethemasconstitutinganintegratedmarketstructure.Asthevastmajorityof

Jordan’slargestprivateenterprisesarepubliclytraded—andasIhavealreadyaccountedforthe

marketimpactofprivatelyheldholdingcompaniesintheprevioussections—,however,itismy

hopethatintheend,myASE-centricanalysiswillstillprovidethereaderwithanaccuratepicture

ofmarketstructureatthetimeofwriting.

Banking

Aspreviouslydiscussed,ArabBankisthelargestsingleactorintheJordanianeconomy.

Mostlybyconsequenceofthisfact,themarketstructureofthebankingsectorcanbedeemedan

oligopolisticone.Asisdetailedinthegraphbelow,ArabBank’smarketcapitalizationasa

percentageoftotalmarketcapitalizationintheBankingSectorstoodat41.6%asofMarch2019;

itsrevenuesasapercentageoftotalbankingrevenues,meanwhile,reached39.5%in2017,the

lastyearforwhichannualdatawasavailable.

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ThesecondlargestplayerinthebankingsectorisTheHousingBankforTradeand

Finance(HBTF).HBTF’smarketcapitalizationratioatthatsametimewas27.7%,andits

percentageoftotalrevenueswas13.2%for2017.Beyondthesetwofirms,ahandfulofother

actorsareworthmentioning.Intermsofmarketcapitalization,JordanIslamicBankandtheBank

ofJordaneachrepresentapproximately5%,respectively,ofthetotalmarket.Morerelevantvis-a-

visflowsthanstocks,meanwhile,JordanAhliBank,CairoAmmanBank,JordanKuwaitBank,and

BankelEtihadallgrabbedthemselvesbetween4.5-6%ofthetotalrevenuepiein2017.

FinancialServices

Themarketstructureofthefinancialservicessectorapproximatesahierarchicalduopoly.

OntopisFirstJordan,whichrepresents65.1%ofaggregatecapitalization.UnionInvestments

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representsthejuniorpartnerinthisduopoly,constituting7.8%aggregatemarketcapitalization.

Nootheractorcontributesmorethanroughly3%.

Notwithstandingtheanti-competitiveeffectsgeneratedbythisduopoly,itisworth

recognizingthatthisunbalanceinmarketcapitalizationhasnotresultedinanunbalanced

distributioninrevenues(atleastinrecentyears).FirstJordan’srevenueswerenearlyhalved

between2016and2017,andnowcompriseamere1.5%ofthesector’sannualtotal.Makingthe

biggestmarkintermofrevenues(ifnotatallintermsofcapitalization)aretheJordanMortgage

RefinanceCompany,aquasi-SOEwhoseincomerepresented41%ofthesector’stotalfor2017.

TrailingbehinditisFirstFinance,whoseincomecontributed12.6%tothattotal.

Insurance

Themarket

structurefortheinsurancesectorisconsiderablymorebalancedandcompetitivethanwhatis

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seeninthebankingandfinancialservicessectors.Threelargefirms—JordanInsurance,AlNasir

alArabi,andMiddleEastInsurance—dooperatefromapositionofdominance,comprising

25.3%,13.4%,and10.2%ofthesector’smarketcapitalizationand14.7%,7.7%,and7.1%of

2017’saggregateannualrevenues,respectively.Theircollectivemarketshare,however,isnotso

largeastoallowpricefixingorothersimilarlynoncompetitivemaneuvers.Withanothertenorso

firmstherebyabletoholdfirmintermsofrevenuesandcapitalization,theinsurancesectoris

oneofthemorecompetitiveonesintheJordanianeconomy.

RealEstate

280

Inpreviouschapters,Ihavedetailedmanyoftheprivatelyrunfirmsintherealestate

sector.IhavealsoemphasizedthegravitythatanumberofGulf-baseddevelopershaveacquired

acrossthewidergeographyofthebuiltenvironment.Beforeproceedingtoareviewofthemarket

structuregoverningtherelationsbetweenpubliclytradedfirms,then,Ibelieveitisimportantto

emphasizethatsuchareview,primafacie,omitsmanyofthemostinfluentialenterprisesinthis

field.Wereone’smappingofthemarketstructuretoincludeMawared,al-Maabar,EagleHillsLLC,

andSaudiOger,afardifferentpicturewouldemerge.

Bethatasitmay,ifoneistodealwiththemarketstructureofdomesticallytraded

publicly-ownedfirmsalone,oneneedfirstbeginwithAFAQHoldingforInvestmentandReal

EstateDevelopment.535Thisfirmrepresents23%ofmarketcapitalizationandashocking63.4%

of2017’saggregaterevenues.FlankingthishegemonareUnionLandDevelopment(20.2%

marketcap,2.1%revenue),TajTouristCompany(8.7%marketcap,9.9%2017revenue),and

Masaken(9.3%marketcap,0.4%revenue).Inviewofthetotalrealestatesector—inclusiveof

publicandprivatecompanies—,Ibelieveitisappropriatetoclassifythemarketstructureas

oligopolistic.ShouldrestrictionsonFDIbeliftedintheyearstocome,moreover,thereare

groundsforanticipatingatotalGulf-takeoverofthesector.

535 Ahmadal-Manaseer,amagnateintheenergyfield,holdsroughly70%oftheequityinAFAQ.

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Hotels

and

Tourism

Themarketstructureinthehotelsandtourismsectorisbestclassifiedasatwo-tiered

oligopoly.InthefirsttierstandZaraInvestments(aSabihMasri-ownedventure)and

MediterraneanTourismCompany,whichrepresents30.9%and30.0%ofmarketcapitalization,

respectively,aswellas50%and14.1%,respectively,of2017’saggregaterevenues.Inthesecond

couldbegroupedJordanProjectTourismDevelopmentCompany(9.9%marketcap,13.2%2017

revenues),al-DawliyahHotels536(7.9%marketcap,8.9%2017revenues),andArabInternational

Hotels(8.6%marketcap,8.2%2017revenues),andAlSharq(9.9%marketcap,4.1%annual

revenues).

AsthereferencestotheMasriandMu’asherfamiliesintimate,itisworthemphasizingthat

thehotelsandtourismsector,liketheBankingsector,remainsapreserveofoldcapital.

536 Recallthatal-DawliyahisanassetoftheMu’asherfamily.

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Transportation

ExcludingRoyalJordanian,afirmthatholdsadomesticmonopolyonairtravelandwhose

revenueswouldconstitute88%ofthetotalweretheytobeincluded,themarketstructurefor

transportationisfairlybalancedandcompetitive.Intermsofmarketcapitalization,Shipping

Line,JordanExpress,ComprehensiveTransports,andtheRumGroupallholdrelativelyeven

portionsofmarketshare.Whilecompetitiveasregardscapitalization,itshouldbeacknowledged

thatJordanExpress’2017revenueswereapproximately5xtherevenuesofShippingLineand

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SalamInternational,andnearly10xthoseofRumGroup.Theirclosestrivalintermsofrevenues,

infact,wasMasafatTransport,whosemarketcapitalizationwasonlyabout20-30%oftheother

actors.

MobileCommunications

Manyofthelargestplayersinthemobilecommunicationsmarket—andUmniahMobile

andZainMobileinparticular—arenotlistedontheAmmanStockExchange.Thisbeingthecase,

mappingthemarketstructuresolelyonthebasisofpubliclytradedfirmswouldgivethereadera

highlydistortedpicture.Whileitisdifficulttocomparetherevenuesandmarketvaluationof

thosefirmsnotontheASEtotheonebehemoththatislistedthere—JordanTelecommunications

Company,underwhosechargethemobilecommunicationsfirmOrangeJordanoperates—,one

cancomparefirmsbasedontheirmobilephonesubscribersandtherebygetsomekindofsense

forthemarketstructure.Asofthefirstquarterof2016,theKuwaiti-ownedZainJordanposted

4.94millionsubscribers,OrangeJordanposted4.59million,andtheBahraini-ownedUmniah

posted4.55million.Nootherfirmcompetesinthemobiletelecommunicationsmarket.This

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beingthecase,themarketstructureformobilecommunicationscanbeclassifiedasoligopolistic

(andaparticularlybalancedoneatthat).

CommercialServices

TheAmmanStockExchangeliststenfirmswithinthecommercialservicessector.Astheir

businessesareverydifferentinnature—rangingfromimport/exportcompaniestoAFAQ

Energy537—delineatingthemarketstructurewithinsuchasectorwillnotprovidemuchinsight

intothenatureofmarketcompetition.Thatsaid,itisworthacknowledgingthatifonewereto

accepttheASE’sclassificatorycriteriaandtherebyacceptthatthiscollectionoffirmsdoes

representacoherentsectorofthemarket,onewouldalsohavetoacknowledgethatthisasector

organizedaccordingtoaduopolisticmarketstructuredominatedbyJordanDutyFree(50.1%

marketcapitalization,6.6%2017revs)andAfaqEnergy(34.2%marketcap,71.8%2017revs).

Pharmaceuticals

Themarketstructureforpharmaceuticalsisoligopolisticthoughbalancedinnature.Four

firmsaretradedontheASE,thesmallestofwhichcomprises17.2%aggregatemarket

537 AFAQEnergyisalsoanassetoftheManaseerfamily.

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capitalizationand7%ofaggregateannualrevenues.Thelargestandmostpowerfulofthesefirms

isDaralDawa538,whichrepresents37.8%totalmarketcapitalizationandwhichgenerated52.6%

ofthesector’s2017’sannualrevenues.TheSocialSecurityCorporationretainsamajoritystakein

DaralDawaatthetimeofwriting.JordanPharmaceuticalsandHayatPharmaceuticalsrepresent

thesecondtwolargestactorsinthesector.

Chemicals

538 AkramAbdulLatifJerabistheChairmanofDaral-Dawa.HeisalsoChairmanofAl-QudsBank.Thefirm’sother

strategicinvestorsincludetheSSC,AbuJaberBrothersCompanyandtheJardanehfamily.

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Thechemicalssectorisalsooligopolisticinnature.ArabPesticidesconstitutes35.6%of

totalmarketcapitalizationandgenerated35.8%of2017’sannualrevenues.Followingclosely

behind,theIndustrialCommercialandAgricultureCompanyrepresents26.2%ofmarket

capitalizationand34.7%ofaggregaterevenues.Beyondthosetwo,anumberofsmallerfirms

comprisebetween4and10%ofeitherofourtwomeasures,respectively.

FoodandBeverages

Themarketstructureamongstpubliclytradedfoodandbeveragefirmsisbestclassifiedas

ahierarchicaloligopoly.OntopisSiniora,whichrepresents35.1%oftotalmarketcapitalization

andwhichcontributed25.5%tothesector’saggregate2017’srevenues.Belowitarefourfirms

ofsimilarsizeandinfluence—JordanPoultry,JordanDairy,GeneralInvest,NationalPoultry,and

ArabInternationalFood—eachofwhichcomprises7-13%ofaggregatecapitalizationandeachof

whichcontributes5-16.5%ofannualrevenues.

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Foodandbeverage,ofcourse,isoneofthesectorsmostexposedtoforeigncompetition.

GiventhelargemarketsharethatgiantMNCslikeCocaCola,Nabisco,andKrafthaveinJordan,

oneshouldnotconsiderthemarketstructureofASE-basedpubliclytradedfirmsfullyreflective

ofthelargermarketstructure.

Mining

Thefirmslistedunderthissectionoftheeconomyhavebeenappropriatelyclassified;

however,totheextentthatminingoperationsarenotnecessarilyincompetitionwithone

another—thebusinessofasteelmanufacturerhasnexttonothingdowiththebusinessofa

potashmine—,anall-inclusivereviewofmarketstructurewillnotnecessarilyaffordgreat

insightsintothenatureofcompetitioninthissector.Thisbeingthecase,IhaveexcludedtheArab

PotashCompany(APC)andJordanPhosphateMinesCompany(JPMC)frommysectoralanalysis.

Asbothfirmspossessmonopolyextractionrightsandasbothcompeteexclusivelywithin

international(ratherthandomestic)markets,Ibelievethisdecisionisjustified.539

539 ItshouldbefirstacknowledgedthattheArabPotashCompany(APC)isthelargestfirmintheminingand

constructionsector,atleastintermsofmarketcapitalization.Asof2017,theAPC’sshareofsector-widemarketcapitalizationstoodat74.2%.Duetothevagariesofinternationalcommoditymarkets,however,APCrevenuesmadeuponly6.5%ofthesector’saggregatetotalin2017.

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ExcludingtheAPCandJPMCfromconsiderationsuggeststhatminingisalsogovernedby

anoligopolisticmarketstructure.Withinthisstructure,NorthernCement,JordanSteel,andthe

JordanCementFactoryrepresentthelargestplayersbyasignificantmargin.Therevenuesofboth

firmscomprisedbetween25and50%ofthenon-phosphate/non-potashtotal.Intermsofmarket

capitalization,however,NorthernCementsignificantlyoutpacesallotheractorsinthesector.

EngineeringandConstruction

Themarketstructureamongstthepubliclytradedengineeringandconstructionsectoris

oligopolisticandhierarchicalinnature.DominatingthemarketisReadyMix,whichrepresents

38.9%ofaggregatemarketcapitalization.Thefirm’s2017revenuesofJD44millionalso

represented56.6%ofthesector’stotal.Belowit,foursmallerfirms—JordanPipes,JordanWood,

ArabSteelandPipes,andAlQudsReadyMix—individuallycontributebetween7and22%of

aggregatemarketcapitalizationaswellasbetween2and10%ofaggregaterevenues

AsmanyofJordan’slargestconstructioncontractorsarenotpubliclytraded—andasmany

oftheseprivatefirmstypicallysecurethemegadevelopmentcontractsdoledoutacrossthe

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country’songoingurbanrenewalefforts(aswasevincedbythefirmofthescandalized/exiled

WalidKurdi)—,itshouldbeacknowledgedthatthisreviewdoesnotperfectlycorrespondtothe

realitiesofthemarketstructureinthissector.

Textiles

Asdiscussedinthepreviouschapter,manyofthelargestfirmsoperatinginthetextiles

sectorareprivatelyowned,export-orientedSouthAsianfirms.Thesefirmsdonotcompetewith

eachothersomuchastheyjointlyexploitJordan’sFTAwiththeUnitedStatessotore-export

theirproducttotheAmericanmarketsans-restrictionsortariff.

Excludingthesefirmsfromconsideration,themarketstructureamongstpubliclylisted

textilecompaniesshouldbeclassifiedasoligopolisticinnature.TheCenturyInvestmentGroup

represents35.9%aggregatemarketcapitalization,thoughthefirmhasnotlisteditsrevenuesfor

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anyofthepastthreeyears,makinganycalculationonthatmetricimpossible.540TheSEZ-based

JordanWorstedMillcomprises61.2%ofmarketcapitalizationand45.3%oftotalrevenues.The

similarlySEZ-basedElZay,meanwhile,earned54.7%of2017’stotalrevenuesdespite

representingjust3%ofthesector’stotalmarketcapitalization.AstheMu’asherfamily’sRanco

HoldingCompanyisheavilyinvestedinbothoftheselasttwofirms,theirincentivestocompete

againstoneanotherarenegligible.

HealthcareServices

Withinthedomainofhealthcareservices,onefindsanotheroligopolistic(albeitbalanced)

marketstructure.AlBiladMedicalServices,theConsultingGroup,andIbnAlHaythamallcontrol

between26%and35%oftotalmarketcapitalizationandbetween27%and36%of2017’s

annualrevenues.

540 Aswasmentionedearlier,theNuqulFamilyisthelargeststrategicinvestorintheCIG(45%equity,roughly).

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Automobiles

Finally,thoughnoneofthesefirmsarepubliclytraded,Ialsowantedtodrawattentionto

theautomobilesectorasitwellepitomizeshowtheaforementionedbourgeoiselitecartelizes

anddominatesprivatemarkets.Atthetimeofwriting,theHaddadfamily’sMarkaziaCompany

holdsthesingleimportanddistributionlicenseforToyotaandallitssistercompanies.TheNuqul

family’sNuqulAutomotiveholdsexclusiveimportanddistributionrightsforthemajorityofthe

bigGermanautomobilecompanies(Audi,PorscheandVolkswagen)aswellasSkoda.TheMalhas

family’sMahmoudiaMotorsholdsexclusiveimportanddistributionrightsforJaguarandLand

Rover,andsoondowntheline.

Thoughcompeting,tosomeextent,fortheattentionsofthoseinthemarketforaluxury

automobile,thisisamarketforwhichthebrandandothervariablesexogeneoustoJordan—the

fuelefficiencyandtechnologicaladvancementofToyotav.Porsche,forexample—willultimately

determinesales.Inotherwords,totheextentthatToyotaandPorschearecompeting,itisan

arenaswhollydetachedfromJordan,inarenaswithinwhichtheirlocaldistributorshavenoeffect

orrelevance.Bynotinfringingoneachfamily’sexclusivedistributionrights,then,thedomestic

automobilemarketis,bydefinition,non-competitive.Freetopricefixtoacertainextent,then,the

Nuqul,Haddad,andMalhasliveandletlivewhileaccruingtherentdistributiongeneratedby

ToyotaandJaguar’sexternalrivalry,arivalryfromwhichtheyarethemselvesentirelyapart.

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Conclusion

MarketsandprivateinitiativemostcertainlyprevailinJordantoday,wheretheystructure

thesocialasmuchastheeconomicorganizationofthenation.Ifresemblinganarchetypical

capitalistformationinthoseregards,however,theJordanianmodalitymostcertainlydiverges

fromstandardmodels—betheyliberalmarketandcorporatistmarketinnature—whenitcomes

totheformofcompetitionthatthesestructuresgivehostto.SectoralmarketstructuresinJordan

tendtowardsmonopolyand/oroligopoly;financialcapitaliscurrentlyconsolidatingits

dominanceoverthewidereconomy;andanarrow,legacy-derivedelite,internallygovernedby

conciliatorypractices,continuestoevinceadegreeofcross-sectorpower(andownership)that

approachescomprehensiveness.

Withmassive,family-ownedconglomeratesandholdingcompaniespresidingover

expansiveempires,youngandemergentfirms—containingthegreatestpotentialforgrowth,as

theWorldBanknowacknowledges—havelittlechanceofchallengingthisstatusquo.By

consequence,Jordaniancapitalismanimatespreciouslittlecompetitiveenergy,asisverifiedby

theconsistencyseeninitssectoralmarketstructuresandbyitsnotablylowratesofmarketexit

andentry.541Whetherthislimited,elite-dominatedformofmarketcompetitionoughtbetreated

asanaberrationalorparadigmaticoutcomeforacapitalisteconomyisaseparatequestion.

Acrossthewidespectrumofactuallyexistingcapitalisms—fromthenominallycutthroat,liberal

541 Onthislastpoint,see:NajyBenhassine,FromPrivilegetoCompetition:UnlockingPrivate-ledGrowthintheMiddle

EastandNorthAfrica,WorldBank(2009),pp.97-104.

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standardbearers(liketheUSandUK)tothetraditionallycontrolledandregulated(likewestern

Europehastraditionallybeenimagined)tothehealthycronyistiterations(SouthKorea,Japan)to

theelite-dominatedperipheraleconomiesoftheglobalsouth—,theempiricalrealityofmarket

competition,afterall,rarelymeasuresuptothatwhichhasbeendiscursivelyimagined.

Nevertheless,theJordanianmodalityisstillnotableforitslackofdynamism,foritsrigid

intraclasshierarchies,forthesocialinterlockingoftheeliteclassfraction,fortheenduring(if

transforming)hegemonyofinheritedwealthandoldguardluminaries,andforthesubtle

protectionismthestatecontinuestoprovideitsdomesticelitesinaneraofnominaleconomic

openness.542Thoughthismodalityofcompetitionhasfacilitatedanarrowelite’srealizationof

dependableprofits—stabilizingaccumulationandfurtherinstitutionalizingthecontemporary

SSAintheprocess—,itdoessoattheexpenseoflong-termdevelopmentandintraclassharmony.

542 Iwilldevelopthispointinmuchgreaterdetailinchapterten.

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CHAPTERNINE

SocialcontrolunderAbdullah

ThesocialcontrolregimeestablishedunderAbdullahduringthepasttwentyyears

evincesgreatercomplexitythantheoneconsolidatedbyhisfatherduringthepost-1973period.

Thoughcontributingtothestabilizationofcapitalaccumulation—andwhilecontributingtothe

profitsaccruingtoanelite,transnationalizedfractionofthebusinessclassinparticular—,this

iterationofHashemitesocialcontrolhasalsoprovenfarmorevolatilethanitspredecessor.

Thisvolatilityreduces,inpart,toAbdullah’sembraceofcoerciveandrepressivesocial

controltactics.WhereHussein’sregimehadcontainedanumberofcorporatistpracticesdesigned

toameliorateclasstensions,hisson’shasbeenpremisedonthegambitthatsilencecanbewon

throughrenderingworkingpeopleconstantlyprecarious.Whiletheeconomy’sreproductionof

starvationwagesandendemicsocialanxiety—inconjunctionwiththestate’scontinued

asphyxiationofworkingclassassociationallife—have,onoccasion,createdsuchdesperationas

toproducelevelsofcollectiveexhaustionthatmightpassforsocialpeace,ithasalsocreatedthe

kindsofconditionswithinwhichantagonisticandcontentiousformsofpoliticalcontention

inevitablyfoment.LiketheotherdimensionsofJordan’scontemporarySSA,then,thissocial

controlstrategyisalsobasictothecountry’scapitalismofcrisis.

ThisanalysisofsocialcontrolunderAbdullahwillbebrokenintofoursubsections.Inthe

first,Iwilldetailthelegal-coerciveaspectsofcontemporarysocialcontrol.Inthesecond,Iwill

focusinonthe(domesticandtransnational)segmentationofthelaborforceandconnectthisto

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thestabilizationofelite-orientedaccumulation.Inthethird,Iwillturntotheproliferationof

micro,small,andmedium-sizedenterprisesanddiscusshowtheyhaveproblematizedthe

mobilizationofworkersolidarity.Finally,inthefourthsubsection,Iwilladdresshowthe

generalizedprecarityofthepopulationmayalsocontributetosocialcontrolinthecontemporary

period.

The GFJTU in the late Hussein period Insectiononeofthisdissertation,IdelineatedhowHusseinmanagedtobringorganizedlabortoheelinthewakeofBlackSeptember(1970-1971).Inconjunctionwiththerepressionofpartisanpolitics,theregime’ssuccessesincommandeeringthemaininstitutionalforaforworkingclassorganization—theGeneralFederationofJordanianTradeUnions(GFJTU)—andininterpellatingagenerationofdocile,sociallydisconnectedlaborleadersmadecertainthatorganizedlaborwassomethingofaspentforcebythetimeAbdullaheventuallycametopower. Thatorganizedlaborwasindeedaspent(andembourgeoised)forcebythelateryearsofKingHussein’srulewasquiteclearlyevincedbytheGFJTU’sineffectualresponsetotheflexibilizationandprivatizationinitiativesthatwereintroducedsubsequenttothearrivaloftheIMFin1989.543LocatingtheiroperationsinShmisani,oneofAmman’supperclassneighborhoods—andclosingdownlocalbranchesandofficesintherestofthecountry—,theGFJTUleadershipeffectivelysatoutthefight,offeringexceedinglylittleassistancetothoseindividualunionsthatattemptedtocontestthepiecemealprivatizationinitiativesofthemid-to-late1990s.544 Thoughtheyputupsomeresistanceto1996’snewLaborLaw,theireffortslargelycametonaught.Byconsequence,Article31ofthislawwouldestablishtheemployer’srightto“terminateworkcontractsofunlimitedperiod..ifeconomicortechnicalcircumstancemandatedthistermination”,whileArticle23wouldallowforemployerstodismissworkerswithoutneedingtoarticulatecauseorjustification.545 ThehollowingoftheGFJTUleftJordan’sworkingclassesdeprivedoftheinstitutionalandorganizationalstructuresitneededsotohaveanychanceofcontestingthestructuralreformpush.Withoutanymeansofconscientizing,mobilizing,protecting,oradvancingsocialandeconomicrights,Jordanianlaborstruggledtogetitsvoiceheardpriorto2011.

543 See:Hourani(2002),p.71544 Ibid,p.23545 Ibid,p.66

296

Beforegoinganyfurther,Ishouldnotethatmanyoftheargumentsbeingmadeinthese

pagesarefunctionalistinnature.Inotherwords,Iamnotnecessarilyascribingdesigntothis

socialcontrolstrategyortothesystemoflabormarketsegmentationthathascometoprevail

overthepasttwentyyears;similarly,Iamnotassigningperfectintentionalitytotheactors

(principally,thePalaceandtheelitefractionofthecapitalistclass)implicatedinandbenefiting

fromsuchasocialcontrolstrategy.Rather,Iamattemptingtodiscernthelogicofawidersystem,

onethatemergesbyitsownaccordthroughtheinterdependentmovementsandinteractionsof

differentplayersandinstitutions,andonethat,onceemergent,shallproceedtoshapesaid

movementsandinteractionshenceforth.

(1)TheJuridicalFoundationsofSocialControl

Inordertotracethecontoursofthesocialcontrolregimeinstitutionalizedunderthe

directionofKingAbdullah(etal),oneoughttobeginwiththatregime’sjuridicalfoundations.As

willbecomeclear,manyofthesefoundationsconstituteaninheritancebestowedbytheprevious

King.Regardlessoftheirsourceofprovenance,however,thesejuridicalfoundationsstructurethe

rightsoflabortoday—andtherelationshipbetweenlaborandthestate—allthesame.

Collectivelyfunctioningsotoimpedetheorganizationofworkplaces,diminishtheleverageof

collectivebargaining,atomizetheworkingclasses,anddisruptthemobilizationofworkingclass

interests(socially,politically,andeconomically),thisframeworkoflegalizedcoercion/discipline

delineatethetermsofcontemporaryclassrelationsandthestate’sself-assignedprerogativesin

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mediatingclassrelations.Insodoing,itwillbeshowntofurtherconsolidateelitedominated

processesofcapitalaccumulation.

Thejuridicalfoundationsofcontemporarysocialcontrolcenteronthelegislationand

regulationofthreeparticularpolicydomains:(1)thedomainof(individualandcollective)labor

rights;(2)thedomainofimmigration;and(3)thedomainofindustrialpolicy.

LaborPolicy

Whenitcomestothefirstofthesedomains,theMinistryofLabor—withanassist,of

course,fromdomesticintelligence—remainstheprimaryinstitutionalactor.Itsregulatory

powersderivefromthediscretionaryauthoritiesitretainsovermattersofunionrecognition.

AcrossAbdullah’stenure,theMinistryhasusedtheseauthoritiesforthepurposesofanexplicitly

anti-laboragenda—asisevincedbythefactthatMoLhasrefusedtoconsignlegalexistenceonto

asinglenewunionoverthelasttwentyyears.

Byconsequence,theonlytradeunionsgrantedtherighttooperateatthetimeofwriting

aretheverysame(co-opted)seventeenunionsthatsurvivedthecullingsoftheearly1970s.546As

Section119oftheLaborCodeallowsthestatetolevyfinesuptoJD1000andtoproscribeprison

sentencesofuptothreemonthsforthoseindividualsthataredeemedtobemembertoanon-

recognizedand/ordissolvedtradeunion,theconsequencesforthosewhomighttrytoorganize

546 Intheseregards,itisworthnotingthatasof2019,theJordaniangovernmentwasstillyettosignILOConvention

87,therebyfreeingthestatefromanylegalcommitmenttowardscompetitiveunionism. OntheJordanianstate’swiderinternationalcommitments,see:MelaniCammettandMarshaPripsteinPosusney,

“LabormarketstandardsandlabormarketflexibilityintheMiddleEast:freetradeandfreerunions?,StudiesinComparativeInternationalDevelopment(45),2010.

298

outsidethosespacesandinstitutionsaccreditedbytheMinistrycanalsobeextremely

significant.547Withmigrantmigrantworkersstillprohibitedfromformingaunionorholding

officeinaunion548andwiththeMinistrystillexploitinglegalgrayareassotopreventagricultural

anddomesticworkersinparticularfromeitherjoiningorformingaunionaswell,theprospects

fornewunionizationsintheyearstocome—andforinstitutionalizedmobilizationsofworking

peoplemoregenerally—looknonetoopromising.549

Inpolicingandregulatingthebusinessofthoseunionsthataregrantedlicensetooperate,

moreover,Abdullah’sMinistryofLaborremainseverybitasdomineeringaswaspreviouslythe

case.Empowered,intheseregards,byavaguelycorporatistLaborCodethatdeprivesJordanian

unionsofthevastmajorityofthenegotiatingandbargainingtacticsthathavetraditionallybeen

inthetoolkitofworkers—andthatillegalizesandcriminalizesindependent,non-sanctioned

547 Onthistopic,see:InternationalTradeUnionConfederation,LettertoPrimeMinisterOmarRazzazre:LaborCode

Reforms:(January,2019). Awad(2016),p.4 Abdullah-eragovernmentshavefrequentlyusedthesemeanstotargetboththeleadershipandmembershipof

thetwelveindependentunofficialunionsthathaveemergedinthe2000s.Thoughtheseactorsareattemptingtoself-organizethroughtheJordanianFederationofIndependentTradeUnions—aninstitutionrepresentingindustrial,agricultural,andpublicsectorworkers—,regimehasprohibitedthemfromopeningofficers,collectivelybargaining,orcollectingmembershipfees.

548 Awad(2016),p.3. Amendmentsin2010didallowmigrantworkerstojoinaunion;giventhattheytendtoworkinsectorsand

activitiesdistinctanddiscretefromorganizedJordanianlabor(sectorswithinwhichnounionsareoperating),however,theamendmentfunctionallymakeslittledifference.

549 Afterall,byexcludingmigrantandagriculturalworkersinthismanner,thestateessentiallydeprives30-45%of

thelaborforceofitsbasiclaborrights—anddeprivestheunionsof30-45%oftheworkersitmightotherwisetrytomobilize.

Whatismore,evenwhenagroupofworkersmanagestoreceiveafavorablerulingfromajudge,theirprospects

ofunionizationcanstillbestifled.Recently,theMinistryofLaborhasrefusedtocountenancepublicsectorunionizationdespitearulingfromtheConstitutionalCourthavingestablishedthatcivilservantsindeedhavethatright(Awad,2016,p.5).

299

formsoforganizingandcontention—,theMoLleavestheseventeenoutfitsunitedunderthe

banneroftheGeneralFederationofJordanianTradeUnions(GFJTU)withbutthehollowest

formsofagencyandindependence.Whenitcomestostriking,forinstance,Sections134and135

oftheLaborCodestipulatethatworkersmaynotusethistacticwhenadisputeisinarbitration,

thatworkerscannotgoonstrikewithoutprovidingtheemployeratleastfourteendaysofnotice

(28daysinthecaseofthepublicsector),andthatthestatecanfineparticipantsinillegalstrikes

50JD(and5JDforeverydaythestrikepersists).Inconjunctionwithlegislationassigningthe

stateinterestakindoflegalontologicalpriorityinthefinalinstance,thespecteroftotalizing

repressionistherebymadetohangeternallyovertheneckoforganizedlabor—assection116of

Jordan’slaborlawmakesratherominouslyclear:

TheMinistermayinstitutejudicialproceedingsbeforethecourtoffirstinstanceforthedissolutionofanytradeunion,ifit:a)violatesanyprovisionofthisCode,providedthattheMinisterhadalreadysenttheunion,beforeinstitutingtheproceedings,writtennoticetoceasetheviolationwithinadeterminedtime-limitandthatthetradeuniondidnotrespondtosuchnotice;(b)instigateswalkouts,workstoppage,stay-instrikesordemonstrationsincaseswheresuchactionsareprohibitedunderthisCodeoranyotherlegislationinforce.

WiththelowerhousehavingrecentlypassedaseriesofnewamendmentstotheLaborcode—

amendmentssubjectingunionbylawstotheoversightandapprovaloftheMinistryofLabor—,

thepolicing,surveilling,andadministeringoforganizedlaborseemspoisedtoonlyintensifyin

thefuture.550

550 See:JordanLaborWatch,“IndependentTradeUnionsrejectlaborlawamendments”,Report:PhenixCenter

EconomicandInformaticStudies(2018).Accessibleat:http://labor-watch.net/ar/read-news/151129?fbclid=IwAR1PMR-zmWqCS11O5QVLAYy3kLvO2pJ_nxbhpmvkOhpkS19IhuA-UIGZbmg

300

Incoercivelysnuffingoutnewunionsandregulating/infiltratingextantonesinto

ineffectuality,thejuridicalmaneuversinthedomainofcollectivelaborrightsjustdescribed

constituteanecessaryandhighlypotent(ifalsoinsufficient)componentofcontemporarysocial

control.Throughthecombinationofthesemeans,organizedlaborhasbeencondemnedintoa

growingirrelevance—afatethatisreflectedintheGFJTU’sdwindlingmembershiprollsandin

sharplydecliningtradeunionmembertototalemploymentrates551—,andlaboringpopulations

havebeenleftwithouttheindependentorganizationalvectorstheyneedinordertoarticulate

collectivegrievance,identity,andinterest.Suchoutcomesarehighlyconducivetothecapital-

dominatedvisionofsocialpeacethatispartandparcelofthewiderneoliberalmodalityof

capitalism.

Ifthestate’slegalandregulatoryinterventionsinthedomainofcollectivelaborrights

constitutesonepillarofthecontemporarysocialcontrolstrategy’sjuridicalfoundations,as

intimated,legalinterventionsinthedomainofindividuallaborrightsrepresentanessentialalbeit

complementarybulwarktosaidfoundations.Herein,oneneedbeginwithlegislationrelatedto

theflexibilizationofthelabormarket.552Likewithunionpolicy,flexibilization’slegislative

genealogytracesbacktobeforeAbdullah’scoronation.

551 Thoughrepresenting230,000workersasof2000,theaggregatemembershipoftheunionsorganizedunderthe

GFJTUisonly200,000asofthetimeofwriting. Wherethetradeunionmemberstototalemploymentratehadbeen20%asof2000,itnowsitsaround6%. See:DanishTradeUnionCouncilforInternationalDevelopmentCooperation,Report:JordanLabourMarket

Profile2018. 552 ItshouldbeacknowledgedthatinitiallegislationrelatedtoflexibilizationprecededAbdullah’stenureasKing

(thefirstreformwaspassedin1996).

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1996’sLaborLawno.8—pushedthroughtheLowerHousewithanudgefromIMF

technocrats553—markedthemaidenvoyageofflexibilization.Amongstotherthings,thispieceof

legislationremovedanumberoflimitsrelatedtotemporaryworkcontracts554andprovided

employerswiththerighttosuspendorterminatecontractsofindefiniteandlimitedduration

should“economicortechnicalconditionsmandate”itso.”555Throughdefiningthelegal

conditionsunderwhichworkerscanbefiredinsuchhermeneuticallydiffuselanguage,Lawno.8

unsurprisinglyfacilitatedariseinarbitrarydismissalsuponitspassageintolaw.556

Therelationshipbetweentheinstitutionalizationofemployerfiringpowersandsocial

controlisnotdifficulttoimagine.Asthespecterofarbitrarydismissalhangs,itistobeexpected

(anditisempiricallyverified)thatworkerswillbechastenedintoeitherquiescenceorinto

553 Onthisnudge,see:CammettandPripsteinPosusney(2010),p.271.554 Italsoestablishedthatasingletemporarycontractcouldextentuptofiveyears;functionallyspeaking,then,this

lawallowedforemployerstoextendtemporaryworkcontractsindefinitely.555 Article26ofthelawcoversthedismissaloflimited-contractworkers. Article31providesemployerswiththerightto“terminateworkcontractsofunlimitedperiod,eitherfully,

partially,ortosuspendthem,ifeconomicortechnicalcircumstancesmandatedthisterminationorsuspension.”Article23ofthelawstipulatesthatanemployermaydismissaworkerwithoutneedingtoprovideareason(Hourani,65).Thoughsections32and33ofthelaborlawprovidesomemeansforseekingredressshouldaworkerbelieveher/himselftobewronglydismissed,courtshavenottypicallybeenfavorabletothesecases.

Itshouldbesaidthatamendmentstothelaborlawin2017and2018havesoughttoredoundsomeofthe

benefitsofflexibilitybackontotheworkers.Provisionshavebeenestablishedwherebyanemployeewhohasworkedfull-timeforthreeconsecutiveyearsataplaceofworkmay,duetofamilyoreducationalneeds,transitionintoremotework,part-timework,orvariablescheduledworkwhilestillretainingtheirrighttoreturntofull-timeworkatalaterdate.Nonetheless,onbalance,flexibilizationhasinevitablyfunctionedsotofurtherstackthedeckinfavorofemployers,andhastherebyprovidedakeymechanismforsocialcontrol.Incombinationwithmigrationpoliciesandthenegativeexternalitiesgeneratedbyformalization,flexibilizationhasexposedallJordanianworkersbutespeciallythoseatthebottomofthewagestructuretothevagariesanddesperationofadogeatdogmarket.

556 ThoughanumberofamendmentswereintroducedtoLawno.8inAugustof2002,noneinvalidatedtheoriginal

pieceoflegislation’sintroductionofeasyfiringandflexiblelaborcontracting.

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acceptingsubstandardwagesandworkconditions.Withinthecontextofsuchpowerrelations,

thesubsequentflexibilizationofworkarrangements—whichhasresultedinavastincreaseinthe

prevalenceofpart-timeworkandfixed-timecontracts,atopicIwilldiveintoindetailina

forthcomingsubsectionongeneralizedprecarity—onlyfurtherforcesthehandoflabor.Ifless

kineticintheireffectsthanpreviouslydescribedcrackdownsonorganizedlabormightbe,by

deprivingworkersofbasicprotectionsandremovingwhatlimitedleveragetheyalreadyhadvis-

a-visemployers,thesejuridicalinterventionscertainlycontributetothediscipliningofthe

workingclassesaswellastotheprofitratesofcapital.

ImmigrationPolicy

Asmentionedattheoutset,thejuridicalfoundationsofcontemporarysocialcontrolrest

notsolelyonthestate’slegislativeandregulatoryinterventionsinthedomainoflaborpolicy,but

alsoonitsinterventions—ormorespecifically,onthestate’spurposefulneglectand

(non)regulation—inthedomainofimmigrationpolicy.Inpreviouschapters,Ihavedetailedhow

legislationinthispolicydomainwasusedtobringhundredsofthousandsoflegallyvulnerable,

sociallyprecarious,lowskill/lowwageworkersintoJordan.Morethanconstitutingakindof

subsidyforprivatefirmsoperatinginthefieldsofagriculture,construction,realestate,and

garmentmanufacturing,IhaveshownhowthesemigrantshavealsosegmentedtheJordanian

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laborforce—andfurtherunderminedtheprospectsofworkingclassmobilizationinthe

process.557

Whilethesepermitted,state-sanctionedinflowsoflabormigrantshavethemselves

contributedtotheregimeofsocialcontrolconsolidatedunderAbdullah’stenureinanumberof

ways558,atthisjuncture,Iwanttotodrawattentiontotherolethatthestate’swillfulneglectof

illegal,non-permittedlabormarketparticipantsplaysintheAbdullah-erasocialcontrolstrategy.

Atthetimeofwriting,therearemorethan500,000non-permittedmigrantsemployedinthe

Jordanianlabormarket.Themagnitudeofthisillegalsurpluslaborforce—ontop,ofcourse,of

theextantlegalsurpluslaborforce—notonlyfunctionssotodepressthewagestructurein

Jordan;italsonecessitatesthatlow-skillJordanianlaborerstooperateunderthesameextralegal

rulesofemploymentthattheprecariousstockofEgyptianandSyriansworkersdo.

Insodoing,thestate’sregulatoryneglectofmigrantworkerpopulationsinthelabor

marketforcesthemostvulnerableofJordanianworkerstoracetothebottomshouldtheyhopeto

haveanychanceofprovidingabasiclevelofsustenancefortheirfamilies.Rendereddesperate,

atomized,andpermanentlyinsecure,suchJordanianworkers—manyofwhomareforcedto

reckonwiththerealitiesofinformalityaswell—tendtoevincethesocialandpolitical

557 Thedomesticworkersamongstthesemigrantshavealsoactedasadefactosubsidyforthemiddleclasses,as

theircheapwagesandlegalprecarityallowsmanyfamiliestosecurehousekeepersandnanniesforarelativepittance.

558 Aswillbediscussedinthesubsectiononlabormarketsegmentation,themagnitudeofnon-nativeworkersinthe

labormarket—andthelegalrestrictionsimpedingtheirinclusioninunionizationefforts—makesthemobilizationofworkers’actionsandworkingclasspoliticsfarmoredifficultthanitmightotherwisebe.

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expressionshistoricallyexpectedoflumpenproletarians.559Manifestinthisclassfraction’s

generalizeddeactivationasasocialorpoliticalforce—aclaimempiricallycorroboratedbytheir

infrequentparticipationinprotests,strikes,orothercollectiveactionsaimedatadvancing

structuralchange560asmuchasintheirlowervotingrates—,thesocialcontroleffectsofthis

immigration-powereddesperationshouldbeobviousenough.Withforeignworkersdisciplined

bylegalprecarityandnativeworkerslackingthereservesofcognitive,social,andmaterialenergy

thatarethepreconditionsofinsurgentcitizenship,themobilizationofeithersolidarityorananti-

capitalchallengeismadefraught.

IndustrialPolicy

Thelastofthejuridicalfoundationsofcontemporarysocialcontrol,finally,havebeenbuilt

andfortifiedwithinthedomainofindustrialpolicy.Specifically—andbyconsequenceofthe

state’saforementionedmodalityoflaissez-faireindustrialpolicy561—,Jordan’sphysicalspacehas

559 Formoreoninformality’srelationshiptopoliticalquiescence(ifnotright-wingpolitics),see:KennethRoberts,

“SocialinequalitieswithoutclasscleavagesinLatinAmerica’sneoliberalera”,StudiesinComparativeInternationalDevelopment(36:4),2002.

AndyBakerandVaniaXimenaVelasco-Guachalla,“Istheinformalsectorpoliticallydifferent?(Null)AnswersfromLatinAmerica”,WorldDevelopment(102),2018.

560 Thisclassfraction’snon-participationinprotestsisalsocomparativelylow(vis-a-visformal,full-timeworkers).

ThisisconfirmedindatafromtheArmedConflictLocationandEventDataprojectandinexaminationsoftherecentinstancesofmajorworkermobilizationsinJordan,whichshowthelumperproletarianstobeanon-factorforalleffectsandpurposes.

561 Includedwithinthesespaces,ofcourse,istheAqabaSpecialEconomicZonethatwasdiscussedatlengthinthe

previouschapter.Mostclearlyevincingthesocial,political,andeconomicimpactthatindustrialremappingcanhave,recallthatAqabaisnowgovernedbytheunelectedAqabaSpecialEconomicZoneAuthority(ASEZA).SubjectedtoanumberofspeciallawsandregulationsparticulartoASEZA’sdominion,thepeopleofAqabaanditssurroundingenvironsnowlack,inmanyinstances,theavenuesofbasiclegalrecoursethataretypicallyaffordedJordaniancitizens.ThoughIhavealreadydemonstratedhowfreelythestatedisregardsitsownlaws

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cometobepartitionedintoahighlycomplexlegalgeographydefinedbyavastconstellationof

specialdevelopmentzones,specialfreezones,andindustrialestates.

Atthetimeofwriting,thirty-sevenprivately-runfreeeconomiczonesareinoperationin

Jordaninadditiontosixpublicly-runfreeeconomiczones,twospecialdevelopmentzones,and

sixindustrialestates(withanotherfiveplannerfortheyearsahead).Asthesespacesofexception

aresubjectedtotheirownspeciallaws562,astheyareoftenpopulatedbyacutelyprecarious

migrantlabor,andastheyarequiteliterallyfencedandwalledofffromtherestofJordanian

territory,thislegalremappingofJordanfunctionssotomakethelogisticalorganizationof

workersextremelydifficult.563WhenoneconsidersthatJordan’sexportprocessingzonesare

almostentirelyinsulatedfromtherestoftheeconomyaswell564,thelegalgeographydemarcated

byindustrialpolicydecisionscannothelpbuttohavehinderedthemobilizationofcross-sector,

economywideworkersolidarityaswell.

andprocesseswhenitcomestolaborissues—whetherinAmman,Ajloun,oranywhereelse—,deprivingAqaba’sworkersoftheseavenuesnonethelessrendersthemevenmorevulnerablethanisthecaseelsewhereinJordan.Inalsocomplicatingeffortstomobilizecollectivestrugglesatanationallevel,thelegalseparatenessofAqabamostcertainlycomestofunctionsotofacilitatesocialcontrol.

562 Thoughsubjectedtoslightdifferences,ingeneral,thistreatmentprovidesallfirmswithinsuchspaceswithaflat

5%corporatetaxrate,exemptionsorreductionsononsalestax,incometaxonexportedgoods,landtaxandbuildingtaxes,dividendstax,customduties,andsocialsecuritycontributions,defactoregulatoryneglectoflaborrights,unlimited,non-conditionalrightswhenitcomestoimportingandemployingforeignworkersandallowsfor100%foreignownership(See:InvestmentLawNo.30,2014).Garmentworkers—comprisingalargeportionofthelaborforceinthesezones—arealsoexemptfromthestate’sminimumwagelegislation.

563 Foreignworkersarefrequentlyhousedinspecialon-sitedormitories;asdiscussed,theyarealsonotallowedto

formunions.564 Recallfromthepreviouschapterthatthefirmsinthesezonesimporttheirindustrialinputsasmuchastheydo

theirlaborforce.

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Whatismore,thespatializationofproductionthattheseexportprocessingzones

facilitate565andgivehosttoonlyfurtherintensifiesthesocialcontroleffectshithertodescribed.

RecallfromthepreviouschapterthatJordan’shostofexportprocessingzoneshavecometobe

dominatedbySouthAsiangarmentmanufacturers.Whetherthisdominanceisintrinsicallyan

issueornot,thenon-conditionalnatureoftheincentivesandsubsidiesaffordedtofirms

operatingwithinsaidzones566concomitantlydeprivestheJordanianstate(anditsworkers)of

anymeansofpushingbackagainstthefootlooseinvestmentandoperationsthatthese

manufacturerstendtopractice.567Abletopackupandleaveatamoment’snoticeshouldworkers

ortheJordanianstateattempttonegotiateorimposeanychangetothefirms’preferredwaysof

doingbusiness—threatsmademoreconvincingbythefactthatthesefootlooseinvestorscan

easilyrelocatetoMorocco,whoseownFTAgrantsfirmsoperatingtherewiththesametariff-free

accesstotheUnitedStates—,spatialization(andlaissez-faireindustrialpolicymoregenerally)

haslicensedSouthAsiancapitaltoleverageitsunrestrictedandabsolutemobilitysotokeep

workersinlinewithremarkableeffectiveness.568Despitethesefirmsbeingnotoriousforpayroll

delinquency,highturnoverrates,andforinducinginjuriesattheworkplace—anddespitethe

565 Recall,perWallaceandBrady,thattheconceptofspatializationdescribeshowboththerelocationofproduction

andthethreatofrelocationfunctionsotodisciplinelabor.Forcedtocompeteforcapitalandmadetooperateundertherulesandlogicofsuchacompetition,thetwoarguethatspatializationnotonlyimpliesaracetothebottomforlaborbutalsoaformofcoercion,onewherethespecterofcapitalflightcanpurchasequietudeandahighlyhierarchicalformofsocialpeace.

566 Ihavediscussed2014’sInvestmentLawNo.30and2008’sDevelopmentZoneLawno.2indetailinchaptereight.567 Thenon-capitalintensivenatureofthegarmentindustrymeansthatfactoriescanbemovedrelativelyeasilyand

relativelyquickly.568 SpecifictoJordan’sQIZ-era,see:Kardooshandal-Khouri(2004),p.28.

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AFL-CIO’sSolidarityCenterhavingpreviouslydescribedlaborconditionswithinJordan’sexport

processingzonesas“tantamounttobondedlabor”569—,theyhaveproventeflontolaboraction.

Forallthesereasons,then,itishardtoimaginethattheregime’sprolificacyinconjuringand

administeringanetworkofexportprocessingzoneshasnotalsocontributedtoalegal-

administrativearchitecturefunctioningsotomakethearticulationofworkingclassinterests

undulyburdensome.

ThePraetorianGuardsofPalaceandCapital

Finally,Iwouldberemissinclosingthissubsectiononthejuridicalstructuresofsocial

controlwereInottomentionhowthestate’slegaleffortsinenforcingclassdominationare

enhancedbytheoccasionaladoptionofextralegalmechanismsofenforcementandpunishment.

CriticalintheseregardshavebeenarecentlyestablishedPalace-alignedbranchofthemilitary

colloquiallyreferredtoasal-Derak.Thoughal-Derak’soperationsarediverseandopaque,when

itcomestosocialcontrol,Iwouldpositthattheyrepresentaspecterandinstrumentofstate-

capitalviolence—aPraetorianguardloyalandaccountabletothePalacealonethatwillact,inthe

finalinstance,atthebehestoftheKingandhistransnationalclassallies.Onthisbasis—and

despitetheirinterventionsbeingrelativelyinfrequent570—,Iwouldthereforearguethatby

569 See:MaryNazzal,EconomicReforminJordan:AnAnalysisofStructuralAdjustmentandQualifiedIndustrialZones,

p.15.570 Al-Derak’spresenceandfunctionwasmostobviouslyseenin2009,whentheyweresenttoputdowntheport

workers’strikeinAqabathatemergedfollowingthesaleofsaidporttoal-Maabar,aUAEbasedmega-developmentfirm.AshasbeendetailedatlengthbyAdely,Tell,andmanyothers,al-Derakmetthepeaceful

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remindingthosewhomightseektochallengecapitaland/orthestateofthestickthatisthe

ultimateguarantoroftheKing’sneoliberalproject,theprospectandpossibilityofal-Derak’s

morekinetic,extralegalpracticesofcoercionanddisciplineissufficientforfurtherenhancingthe

efficacyofthejuridicalfoundationspreviouslydescribed.

(2)LaborMarketSegmentation

Labormarketsegmentation,whichisbothanoutcomeoftheprocesseshithertodetailed

andanautonomous,somewhatself-containedvariableindependentlyimplicatedinthe

contemporarysocialcontrolregime571,isalsocentraltothediscipliningandcontainmentofthe

Jordanianworkingclasses.Reflectingandaugmentingtheeffectsproducedbyjuridical

institutionalization,segmentationfunctionssotodeepenpreexistingintraandinterclass

divisions—whethertheybebasedonsectoral,ethnic,national,orgenerationalcleavages.Further

complicatingthelayofthelandforthosewhomightaspiretomobilizecollectivegrievanceorto

buildnetworksofsocialsolidarity,segmentationtherebymakesasignificantcontributiontothe

stabilizationofJordan’selite-dominatedmodalityofcrisiscapitalism.

protestsoftheportworkerswithbrutalviolence.Sixty-fivepeoplewerearrested,onesentintoacoma,andahandfulofothersbadlyinjured(DeBruyne,2013,p.196).

571 Inasense,then,segmentationcontainsdescriptive(i.e.itdescribestheeffectsofjuridicalprocesses)andcausal

properties(i.e.itcontributestosocialcontrolitself).

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LabormarketsegmentationinJordanisorganizedaroundtwoprincipalcleavages.The

firstcleavageseparatesworkersinthepublicsectorfromthoseintheprivatesector.This

cleavagecontainsethnicpropertiesbyvirtueofthepost-1971dePalestinianizationofthepublic

sector,andgenerationalpropertiesbyvirtueofpost-1989fiscalconsolidationaswell.572The

secondcleavage,meanwhile,separatesworkerswhoareJordaniancitizensfromthosewhoare

not.

Thefirstofthesecleavageshaslonggeneratedagreatdealofscholarlyandpolitical

attention.Asitrelatestosocialcontrol,thesegmentationofworkersbetweenpublicandprivate

sectors—aswellastheinfrequencywithwhichanindividualmightcrossthiscleavage—notonly

partitionslargesegmentsoftheworkingclassintotwoseparateandrelativelyunbridgeable

camps;italsoallowspoliticians,policymakers,andforeigntechnocratstotheninvesteachof

thosecampswithallegedlydivergentifnotantagonisticinterests.Thiscynicalpittingofworker

againstworkerhasbeenseeninanumberoftheanti-publicsectorcampaignsthathavebeen

launchedbytheIFIsandtheircompradorassociateswithinGenerationAbdullahacrossthepast

twentyyears.Presentingthedeprivation,deficientjobcreation,andlackofsecuritythatis

structuraltoprivatesectoremploymentnotasaproductofthemarket’senduring(andintrinsic)

failuresbutasaproductofthedecentwagesandbenefitsonofferinthepublicsector,these

campaignssingularlyattributethepovertyoftheneoliberaleraontothestateandthose

incumbentswhosecuretheirfamily’swelfarethroughemploymentinit.Itisadiscourse

572 Underthepublicsectorcategory,Iincludeboththoseworkingdirectlyforthestate(agroupinclusiveofcivil

servantsandmilitarypersonnel)aswellasthoseworkingforstate-ownedenterprisesandnominallyautonomousinstitutionsliketheSSC.

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imaginingthatunemploymentwillgoawayoncethepromiseofpublicsectorwagesandbenefits

ceasedistortingtheexpectationsofjobseekers,andonethatevokesteleologicalreasoningsoto

assertthatthecollectiveinterestwillbeservedbyallworkersaccommodatingthemselvesto

prerogativesofprivatecapitalandtheaustereimperativesofglobalcompetition.

Byrefracting(publicandprivatesector)workers’resentmentsawayfromthesourceof

theircollectivediscontentandontooneanother,thecontributionthatsuchasegmentation-

deriveddiscourseofferstosocialcontrolisconsiderable.Whenthepublic-privatesectorcleavage

isanimatedbyexistential,ethnicizedcontentthroughtheassociationof(lazy)publicsectorwork

withethnicTransjordanianness,thisaspectoflabormarketsegmentationcanbecomeevenmore

destructivetotheprospectsofworkingclasspolitics/solidarity.Thesame,ofcourse,canalsobe

saidforthegenerationaldividethatisalsocontainedwithinthepublic-privatesectorcleavage.

Similarlyavailableforthosewhowouldprefertoascribetheprecarityandhopelessnessofsome

workingpeople(specifically,theyoungjobseeker)nottothefailingsofcontemporarycapitalism,

buttotheexcessandgreedofotherworkingpeople(specifically,incumbent,grandfathered-in

publicsectorworkers),theinvocationofgenerationalbeefinfactrepresentsoneofthemore

commonrefrainseeninthediscoursesofmystificationjustdescribed.Astheyounghaveindeed

beenforcedtodisproportionallyshouldertheburdenandcostsofAbdullah’sneoliberalism—and

asolder(orretired)publicsectorworkersareindeednaturallyapprehensiveatthethoughtof

thetransformationalchangetheyoungmightseektoachieveduetothestaketheyretaininthe

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statusquo573—,thegenerationaldivideonlyfurthermuddlesthebuildingofclasssolidarity,and

onlyfurtherabetssocialcontrol.

Adirectoutcomeofthestate’sjuridicalinterventionsinthedomainofimmigrationpolicy,

thesecondcleavageundergirdingthesegmentationoftheJordanianlabormarketistheone

separatingJordanianfromnon-Jordaniancitizen.Beforeaddressingthisdirectly,oneneedfirst

familiarizeoneselfwiththescopeandmagnitudeofcontemporaryJordan’snon-national

populations.

Aswasbrieflytouchedonearlierinthischapter,byconsequenceofbothexogenous

shocks574anddesignedimmigrationpolicies575,theethnicandnationalcompositionofthe

573 Aswasdetailedinthepreviouschapter,therelativefootprintofpublicemploymenthasshrunkconsiderablyin

thepost-1989period.Inbrokeringthispartialretreat,however,thestatehastendedtoprotectincumbentsattheexpenseofnewjobseekers.Inotherwords,thereducedrelativefootprintisafunctionofhiringfreezesmorethanitisofmasslayoffs.

Inadditiontoavoidinganythingresemblingmasslayoffs,protectionofincumbentshasmeantpreservingthe

extensivehealthcareandretirementbenefitsthatHussein’spolicymakershadputinplaceduringthepost-1973period.Atatimewhentheyoungaresufferingfromhistoricallyhighlevelsofunemployment,then,theyarealsoforcedtoobservemembersoftheoldergenerationsoptingforearlyretirementandexperiencingalevelofsocialsecuritywhollyunknowntothoseunderthirty-fiveyearsofage.

574 InadditiontotheSyrianrefugeecrisis,thesecondIntifadaandthesecondGulfWaralsoprecipitatedmass

migrationsoutofPalestineandIraq,respectively.575 Certainly,theSyrianinfluxwasonenotdesiredbytheJordanianstateoritsbusinessclass.However,asSyrian

refugeescontributenomorethan20%ofthetotalnumberofnon-Jordaniansworkinginthecountry,thepervasivenessofforeignlabortodaycannotbepinnedonthemoronexternaleventsmoregenerally.

Indeed,aswasearlierdiscussed,itisimportanttoemphasizethatthisparticularaspectofJordan’slabormarket

segmentationhasbeenachievedthroughthewillfulinterventionsofpolicyplannerandcapitalistelitealike,atleastinpart.Theseforeignlaborersarecritical,afterall,totheagriculturalsector,toconstructionandurbanrenewal,andtotheexport-orientedindustrialpoliciesthathavebeenundertakenoverthepasttwentyyears.Specifictothelatter,theconstellationofspecialeconomiczones,qualifyingindustrialzones,andspecialdevelopmentzonesnowexistingoutsidethelegalgeographyofthestatehavenotonlyentrenchedSouthAsiancapitalandthere-exportationoflowsophisticationtextilesattheheartofthecountry’sindustrialcore.Asthefirmsoperatinginthoseexportprocessingzonescompetebasedonimplicitsubsidiesaffordedbythestate—subsidiesinclusiveofaforeignlaborstockthatcanbepaidsub-marketwages—,theyhaverequiredthatJordaniangovernmentsinsureasteadysupplyofnon-Jordanianlabor.Theprofitsachievedinurbanrenewal—whetherthroughrealestatespeculation,construction,orvariousotherenterprisescenteredonthe

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Jordanianpopulationtodayhasbeenmadeincrediblediverse.A2015censusshowed2.9million

non-nationalsresidingaJordan,afigurerepresenting30.6%ofthetotalpopulation.Asthis

translatesintothelabormarket,priortotheArabUprisings,theMinistryofLaborhadestimated

thatsomewherebetween350,000and500,000non-nationalswereworking(legallyandillegally)

inJordan.576Thesenumberswouldsubsequentlyclimbevenhigher,however,followingthe

outbreakoftheSyriancivilwar.Fromthatresultinginflowalone,somewherebetween70,000to

100,000non-nationalworkerswereaddedtotheJordanianlaborpool.AportionoftheseSyrian

workerswoundupeventuallybeinggivenpapersbytheJordanianstate.

Incombinationwithcontinuinglegalinflowsfromotherpartsoftheregion,theranksof

Jordan’spermit-holdingforeignworkercommunitygrewto396,091asof2017accordingtothe

registriesoftheMinistryofLabor.577Asfornon-permitted,illegalforeignlaborers,theMinistry

estimatedthatfiguretohavereachedatleast500,000bythemiddleofthe2010s.Conservatively,

then,atthetimeofwriting,onecanassumethataminimumof900,000non-Jordaniansworkers

areparticipatingintheJordanianlabormarket.578Asfaraspercentagesgo,non-Jordaniansnow

transformationofthebuiltenvironment—,aresimilarlycontingentuponthepresenceofcheap,non-nationallabor.

576 See:MinistryofPlanningandInternationalCooperation,NationalEmploymentStrategy:2011-2020

(Amman:2010).577 Thisincreaseinthepermitsissuedtoforeignworkersoccurreddespitepolicymakershavingpledgedtostopthe

issuanceofnewpermitsinJuneof2016. See:KirkSowell,“ReformingJordan’sLaborMarket.”Report:Sada,CarnegieEndowmentforInternationalPeace

(2017),p.2.578 See:MinistryofLabor,TheNationalLabourMarketIndicators2013-2017(Amman,2018),p.29. TheMinistryclassifies340,995ofthisnumberas“migrantworkers.”

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constitutebetween31-40%ofthetotalemployedpopulationinJordan.579Whenitcomestotheir

contributiontothewiderworkforce—i.e.thoseindividualsthatareemployedorcurrently

searchingforwork—,non-Jordaniansnowconstituteatleast36%ofthenationaltotal(upfrom

16%in2004).

Thereaderhaslikelyanticipatedsomeoftheeffectsthatthistransnationalizationofthe

laborforce—andthecleavageitdefineswithintheworkingclass—hasvis-a-viscontemporary

socialcontrol.Aswaspreviouslydiscussed,bymakinganarmyofextralegal,non-nationalsurplus

laboreternallyavailable,theregime’simmigrationpolicieshavedraggeddownthewage

structureandaffordedemployerswiththealternativeofoptingoutfromdomesticlabor(should

itunionize,orseektocollectivelybargain)wheneveritmightbenecessary.Whatismore,the

presenceofthesesurpluspopulations—themajorityofwhicharelackinginproperlegalrights—

simultaneouslyforcesthoseJordaniansatthebottomofthelabormarkettocompeteunderthe

conditionsthatthosedesperateEgyptiansandSyriansarewillingtocompeteunder.Poor

Jordaniansinparticularmustthereforeacceptthefundamentalprecarityandlackofrecourse

thatisbasictothemigrantorrefugeelesttheyfaceajoblessfuture.580Byconsequence,the

presenceofmassivemigrantstocksinJordanallowsthecapitalistclasstopoliceandcheckthe

ambitionofthetrulydisinherited,furthermuddyinganyattemptatclass-basedmobilization.

579 See:AssaadandSalemi(2018),p.5.580 Asof2015,anestimated86%ofSyrianslivinginJordanianurbanareaswerebelowthepovertyline(Belair,

2016p.2).

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LongerTermTrendsinLaborMigration581

Nordothesocialcontroleffectsofthiscleavageendthere.Foranumberofreasons,the

largenumberofpermittedforeignlaborersincertainsectorsoftheeconomyalsocomplicate

attemptsatcollectiveactionandunionization.Tobegin,duetothevulnerabilitythatisintrinsic

totheirlegalcategory,thesepopulationsaredisincentivizedagainstparticipatinginadversarial

campaignsagainstemployers.Theyarealsodisallowedfromformingtheirownunions.Byvirtue

ofthefactthatmanyeconomicsectorsareratherneatlysegmentedalongnationallines,thislegal

provisionlargelypreventssuchpopulationsfromjoininganexistingunionaswell(asthere

wouldbenouniontojoinshouldasectorbepredominatedbyEgyptianlaborinthefirstplace).

Inadditiontoprecipitatingsomeresentmentsofthe“they’retakingourjobs”variety,then,the

581 TablesandchartsprovidedbyBelair(2016),pp.4,8

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hugepresenceofmigratorylaboralsomakestheorganizationofclasssolidarityafarmoretricky

operation.

(3)MSME-basedatomization

Asof2016,17%oftheJordanianlaborforcewasself-employed.582AcrossAbdullah’s

tenure,moreover,apluralityofJordanianwageworkershavepliedtheirtradewithina

microenterprise.583Thesefirms,employingtenemployeesorless,predominantlyoperatewithin

thecountry’soversaturatedretailsector.Theproliferationofbothmicroenterprisesandself-

employmentarenotrandomoccurencesbut,rather,thedesignedanddesiredproductofthe

stateinitiateddevelopmentandpovertyalleviationstrategies.584

Misguidedandcounterproductivethoughthesestrategiesmaybevis-a-vistheirown

explicitgoals,theyarenoteworthytotheextentthattheyhaveindirectlycontributedtosocial

control.Regardingself-employmentandreluctantentrepreneurship,itishistoricallywell

582 RehamRizkandColetteSalemi,“OwnaccountworkersinJordan:profileandcharacteristics”,EconomicResearch

ForumWorkingPaperno.1218(2018),p.14.583 Asof2016,29%ofJordanianlaborersworkedinamicroenterprise,downfrom33%in2010.Muchofthis

declineisexplainedbyatransferofworkersfrommicroenterprisestosmallenterprises(thoseemploying10-99employees):theshareofthoseemployedinsmallenterprisesgrewfrom28%in2010to37%in2016.

See:JordanLaborMarketPanelSurvey2016.584 Self-employment,ownaccountemployment,andhouseholdentrepreneurialismhasbeenconsistently

championedbytheJordanianstateandtheinternationalfinancialinstitutionsalike.Thisissodespitethereplicative,non-innovativenatureofmicroenterprisesinaneconomylikeJordan’s.Itisalsosodespitethefactthatthedemandforthesimplegoodsproducedbysuchenterpriseswillbeinevitablyboundbyinelasticity.Giventhecountry’sdistancefromtheglobaltechnologicalfrontier,afterall,thesebusinessesdon’twindupmakingmicroprocessors;theyeithermakesimpletrinketsorsellchipsandsodainadukan.Bypushingmoreandmorepeopleintothislineofwork,thecountry’sdevelopmentstrategydoesnotgrowthepie—itdividesitintosmallerandsmallerslices.

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establishedthatsuchaformofworktendstobeassociatedwiththespreadofreactionary,petite

bourgeoisideologyandpoliticaltendencies.585BypushingsomanyJordanianworkersintosucha

socialcondition,then,thestate’sdevelopmentandpovertyalleviationpoliciesnecessarilyhelpto

mitigatethepossibilityofworkingclassmobilizations.

Inaddition,theproliferationofself-employmentandmicroenterprisesalsofunctionsto

deprivelaboractivistsofthelargeshopfloorsandmass-employingindustrialworkplacesthat

arethesinequanonofunionization,workingclassbargainingpower,andlaborpolitics.586

Whetherthiswastheintentofpolicymakersornot,then,thesedevelopment/povertyalleviation

programshavesimultaneouslyservedsotoatomizethelaborforceandsotoimpedethe

conscientizationofcollectivesolidarity.Scatteringanddisorientingthelowerclasses,theireffect

onsocialcontrol(andthewiderembeddingofneoliberalcapitalism)shouldnotbediminished.

(4)GeneralizedPrecarity

Finally,Iwanttoclosebyemphasizinghowthegeneralizedprecaritythathasbeen

producedthroughallthesemechanismsofsocialcontrol—fromlegalassaultsonunionizationto

labormarketflexibilization;frommigrationpolicytoMSMEpromotion—mayitselfcontributeto

socialcontrol.RecallfromtheopeningchapterthatthevastmajorityofJordanianwageworkers

585 Formoreonthis,see:AbhijitBanerjeeandEstherDufloPoorEconomics:ARadicalRethinkingoftheWaytoRight

GlobalPoverty.PublicAffairs,2011.586 Indicativeofthedifficultylaborershaveinadvancingtheirinterestswithinsmallworkplaces,only3%ofthose

employedinMSMEsin2010wereaffordedemployer-providedhealthinsurance. See:Assaad(2014),p.30.

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nowhoverperilouslyclosetothepovertyline.RecallthathundredsofthousandsofJordanians

arecurrentlyemployedeitherirregularlyorinformally.Recallthatmillionsofothersareeither

unemployedoroutofthelaborforcealtogetherAndrecallthatmanyofthosewhohavetriedto

organizethedisinherited—betheypoliticalparties,civilsocietygroups,ortradeunions—have

beensubjectedtotherepressivepowersofthestate.

Inthiscontext,itshouldnotstrikethereaderasshockingthatworkingpeopleoftenlack

thespacethatisneededtothinkbeyondthechallengesofthedaytoday.Withcognitiveenergies

rightlydevotedtotheexigenciesofthepresent—andwiththeemergenceofkinshipandreligion-

basedsystemsofwelfareandsocialsecurityinthepost-1989period587—,generalizedprecarity

makesthecoalescenceandorganizationofclass-basedsolidarityevenmoredifficultthanit

wouldotherwisebe.Asthemagnitudeofdeprivation(andatomization)simultaneouslyrenders

bothindividualsandgroupssusceptibletolocalizedco-optationinmomentsofcrisis—asthe

palace’ssuccessesinusingselective,opportunistichiring,investment,andrentdistribution

duringthepost-Uprisingperiodclearlyevinces—,thesocialcontroleffectsofgeneralized

precaritymaybeevenlargerthanisinitiallyapparent.Thoughthisisaspectofsocialcontrolis

farfromfoolproof,solongasthePalaceandcapitalcanbreaktheranksofcollectiveaction

throughselectivekinorgroup-basedallocationsofrentsandopportunity,theyhavelessneedto

fearanykindofseismicchangetothepoliticalorsocialorder.

587 Formoreontheemergenceofthesekinshipnetworks,see:AnneMarieBaylouny,PrivatizingWelfareinthe

MiddleEast:KinMutualAidAssociationsinJordanandLebanon.IndianaUniversityPress(2010).

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Conclusion

Comprisedoffourprinciplecomponents—(1)juridicaldiscipline;(2)labormarket

segmentation;(3)MSME-basedatomization;and(4)generalizedprecarity,thesocialcontrol

strategyoperatingacrossAbdullah’stenurehassuccessfullyimpededthecoalescenceofclass

solidarityorlargescaleanti-systemagitation.Thoughthematerialdeprivationandsocial

dislocationthatareendemictothisstrategysimultaneouslygeneratetheconditionsforitsown

demise—andthoughJordanhaswitnessedanumberofinstancesofintraandcross-class

mobilizationduringtheneoliberalera—,thefunctionalcoherenceofthesocialcontrolstrategy

hasasyetheldsteady.Insodoing,ithasplayedacriticalroleinstabilizingcapitalaccumulation

(andinaugmentingtheprofitsoftheelitefractionofthecapitalistclass)despitetheeconomy’s

generationofsuchextremefailureswhenitcomestojobcreation,growth,productivity,andthe

generalwelfareofthemiddleandlowerclasses.NoneofthisshouldbereadsotoassignJordan’s

neoliberalcapitalismsomekindofontologicalpermanence,ofcourse.Itshould,however,chasten

oneagainstunderstatingcapital’sresilience.

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CHAPTERTEN

Peripherality,dependencyandtheexternalarticulationofJordaniancapitalism

Inthischapter,IwilldiscusstheexternalarticulationoftheJordanianSSA,analyzinghow

ittoocontributestotheinstitutionalizationofcrisiscapitalismontheeastbankoftheriver

Jordan.DisaggregatingtheprocessesthroughwhichtheJordaniancapitalismhasbeenintegrated

intoregionalandinternationalsystemsoffinance,production,andtrade,Iwilldemonstratethat

thenatureoftheprofitswhicharegeneratedforaselect,elitefractionofthecapitalistclass

throughthisexternalarticulationimpliesandprefiguresthelong-termunderdevelopmentofthe

economy.

Myanalysiswillbebrokenintotwosubsections.Inthefirst,Iwillconsiderthepolicies

informingJordan’sglobalandregionalintegration,orwhatIcallthejuridicalinstitutionalization

ofeconomicopening.AsIhavealreadycoveredsomeaspectsofthisinstitutionalizationin

previouschapters—principally,thecountry’simmigration,investment,andindustrialpolicies—,

thisanalysiswillprimarilyemphasizetheparticulareffectsborneoftradeandbudgetpolicy.

Herein,Iwillprocesstracetheeconomicconsequencesyieldedbythecountry’saccessiontothe

WTO,byitssigningofhighlyinfluentialbilateraltradeagreements,andbythestate’senduring

dependenceonexternalbudgetarysources.588

588 Specifically,IwillbeexaminingtheJordan-UnitedStatesFreeTradeAgreement(JUSFTA)andtheEUAssociation

AgreementonJordaninconsiderabledetail.ThoughIwillalsotouchonahandfulofregionaltradeinitiativessuchastheGreaterArabFreeTradeAgreement(GAFTA),asthesehavebeenmuchlessimpactfulinpractice,theywillnotbegivenprideofplace.RegardingGAFTAforexample,thoughitwasmeanttoeliminateallimpedimentstotradeasof2005,extensivenon-tarifftradebarriersremaininplaceacrosstheregion,andintraregionaltraderemainsquitelowasaresult.

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Insectiontwo,IwillconsidertheconsequencesproducedbyJordan’sveryparticular

modalityofeconomicopening.Herein,Iwillhighlightandexplainfoureconomicoutcomesthat

arespecificallyrelevanttocontemporaryunderdevelopment.Thefirstconcernsthecountry’s

decliningtermsoftrade.Narrowinginontheexportsideoftheledger,thesecondconcernsthe

decliningsophisticationofJordan’sexportbasket.Directlyrelatedtoinvestmentpolicydecisions,

thethirdconcernstheeffectsoftheGulf’scolonizationofJordan’sdomesticcapitalstock,

emphasizinghowGulf-basedFDI’stendencytowardsnon-productiveinvestmentundermines

industrialdevelopmentandtechnologicalconvergencealike.Bringingimmigrationpolicytothe

fore,thefourthconcernsGenerationAbdullah’sstructuralandinstitutionalproductionofbrain

drainduringthepasttwentyyears.

(1)TheJuridicalInstitutionalizationofEconomicOpening

TradePolicy

Aswasdetailedintheclosingpagesofchapterthree,Jordan’smoderneconomicopening

precededtheascensionofAbdullahtopower.Torecap,afterdebtandbankingcrisesinthemid-

late1980sforcedKingHusseintoturntotheIMFashislenderoflastresort,thecountryhad

beencoercedintoinauguratingacontrolledliberalizationprogram.Oneconsequenceofthiswas

1995’sInvestmentPromotionLaw,whichestablishedthatforeigninvestorswerenottobe

subjectedtoanydiscriminatorymeasureswithinJordan.Thatsameyear,separatepiecesof

legislationmadethedinarfullyconvertibleforcommercialtransactionandremovedrestrictions

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onthetransferofinvestmentsabroad,respectively.589ThoughapermitfromtheCentralBankof

Jordan(CBJ)wasstillrequiredintheeventalocalbanksoughttotransferfundsabroad—and

thoughtheCBJrequiredthatitbeinformedbeforeanexternalinvestortransferredfundsinto

Jordanatthistime—,solongaspriorauthorizationhadbeenobtained,theseregulatorychanges

liftedmanyofthecheckspreviouslyhinderingtheinfloworoutflowofcapitaland/orthe

repatriationofprofits.

Notwithstanding,then,theliberalizingworkthatwasalreadydonepriortoAbdullah’s

coronation,economicopeningwouldneverthelessbeacceleratedandpushedintowholenew

domainsundertheguidanceoftheKing’sEconomicConsultativeCouncil.Regardingthecurrent

account,royaldecreeandprovisionallegislationissuedintheabsenceofparliamentwereusedin

theearly2000ssotounilaterally(andsignificantly)reducethecountry’saverageweightedtariff

rate.590Non-tarifftradebarrierswerealsoremovedtoaconsiderableextentduringthissame

period.Asimpactfulasthesetariff-relatedmeasureswere,however,theireffectsonJordan’s

largerintegrationintotheglobaleconomywouldpaleincomparisontothoseborneofJordan’s

accessiontotheWTO.

Accessionwassteeredthroughparliamentinspiteofmassivepublicoppositionduringthe

earlymonthsof2000.591Astheoppositionhadfeared,itseffectsonthepolicyspaceavailableto

589 ForeignexchangecontrolshadalreadybeeninvestedintheCentralBankofJordanasof1979’samendmentto

ForeignExchangeControlLawno.95.590 35%inthemid-1980s,Jordan’smost-favorednationweightedtariffratewasbroughtdownto13.5%asofearly

2000.591 See:FerrisNesheiwat,“TheadoptionofintellectualpropertystandardsbeyondTRIPS–isitamisguidedlegal

andeconomicobsessionbydevelopingcountries”,LoyolaofLosAngelesInternationalandComparativeLawReview(2010),p.361.

322

elected(andunelected)governmentofficialswouldbesignificantanddeleteriousfroma

developmentalperspective.ByconsequenceofJordanagreeingtoabidebytheWTO’sGeneral

AgreementonTariffsandTrade,forinstance,policymakerswereimmediatelyrequiredtoreduce

thecountry’stariffratesevenlowerthanthe13.5%alreadyestablishedbyAbdullahandhis

proverbialChicagoBoys.592ByconsequenceofJordanagreeingtotheWTO’sGeneralAgreement

onTradeinServices,meanwhile,policymakerswereforcedtorewritelawsofStandardsand

Metrology,Agriculture,NationalProductionsProtection,GeneralSalesTax,Customs,Importand

Export,aswellasthecountry’sinvestmentregulations.Fromthejump,then,thelegislative

impactofaccessionwastoextendwellbeyondquestionsofcustomsandtariffalone.

592 By2010,thecountry’smaximumimporttariffratewouldtherebybereducedby33%ascomparedto2000levels

(decliningfrom30%to20%);Jordan’sweightedaverage,meanwhile,woulddeclineallthewaydownto8.1%forthosetradingpartnerswithMostFavoriteNationstatus.

Formoreonthis,see:MatthiasBusseandSteffenGroning,“Assessingtheimpactoftradeliberalization:thecaseofJordan”,JournalofEconomicIntegration(2012),p.470.

TheGlobalFinancialCrisisandtheReturnof(some)CapitalControls Thoughthecapitalaccountwassimilarlyliberalizedduringtheearlyyearsofthenewmillenium,itshouldbeacknowledgedthatsomerestrictionsoncapitalmovementswerereintroducedfollowingtheruptureofthe2007-2008globalfinancialcrisis.Ofnotehere,2017’sRegulatingDealingswithForeignStockExchangesLawno.1wouldstipulatethattradinginforeignstockexchanges—aswellasmediatingsuchtradesonbehalfofthirdparties—wastobedisallowedforallexceptlicensedcommercialbanksandthosefinancialservicescompaniesthatwereoverseenbytheJordanSecuritiesCommission.Interestingly,thoughanearlier,provisionalversionofthislawhadpassedin2008andthoughthatversionofthelawhadexplicitlyexemptedforeignbanksfromthetermsofthislegislation,thecontemporaryversiondoesnotdelineateanysuchexemptionsnewiterationdidnot.Inadditiontotheseregulations,aswasdiscussedinchapterseven,restrictionsarealsostillinplacewhenitcomestoFDIintherealestate,construction,wholesale,andretailtradesectors.Inviewofthefactthatforeignexchangelawstillinsuresthefreeandrestrictedrepatriationofcapitalandprofits,however,theburdensomenatureoftheserestrictionsandregulationsshouldnotbeoverstated.

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Ofcourse,nowherewasthelegislativeinvasiveness—orthedevelopmentalimpact—of

WTOaccessionmorepronouncedthaninthecaseoftheorganization’sTrade-RelatedAspectsof

IntellectualPropertyRightsAgreement(TRIPs).Theseimpactsfirstmanifestedwhenthespecter

ofWTOaccessiondroveJordanianpolicymakerstopre-emptivelypassanew,moresuitable

PatentLaw.Whereas1973’sPatentLawhadonlylegislatedforprocesspatents,Article2of

1999’sTRIPs-informededitionextendedpatentprotectiontothefinalproductaswell.593As

wouldlaterbecomeclear,thisslightchangefunctionedtoinvalidateandillegalizetheentire

businessmodeluponwhichtheJordanianpharmaceuticalindustryhadbeenfounded—namely,

theproductionanddisseminationofgenericdrugs.Whatismore,asAbdullah’sreformerswere

particularlykeenonusingIPpolicy—afavoritebugaboooftheinternationalcommunity—asa

provinggroundfortheirliberalbonafides,theywouldpartnerthispatentlegislationwith

aggressiveenforcementandregulationoperations.594

Clearly,then,accessiontotheWTOhadmeantfarmorethantheliftingoftradebarriers:it

hadalsoprecipitatedsignificantreformstolegislativeandregulatorypraxes.Andyet,impactful

asjoiningtheWTOwasbothintheseregardsandwhenitcametoshapingtheexternal

articulationofJordan’ssocialstructureofaccumulationmoregenerally,itseffectonthecountry’s

593 See:Hamedel-SaidandMohammedel-Said,“TRIPS-Plusimplicationsforaccesstomedicinesindeveloping

countries:lessonsfromJordan-UnitedStatesFreeTradeAgreement”,TheJournalofWorldIntellectualProperty(10:6),2007,p.446.

594 Thoughdisadvantageousfromadevelopmentalperspective,thiszealoustargetingofIPcrimewouldleadtoa

significantdropintheratesofsoftwarepiracyandwinAbdullah’sregimesomefavoramongstitswesternpatrons(Nesheiwat,2010,p.370).

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contemporaryformofcapitalismwouldactuallypaleincomparisontothoseborneofthe

country’sbilateralfreetradeagreements.595

TheJordan-UnitedStatesFreeTradeAgreement(JUSFTA)

2001’sJordan-UnitedStatesFreeTradeAgreement(JUSFTA)hasproventhemost

impactfulofthecountry’sforaysintotradebiliateralism.596Thattheseimpactshavealsoproven

unambiguouslynegativemighthavebeenanticipatedwereonetohavehadtheoccasionto

observethecompositionoftherespectivenegotiationteamsrepresentingthetwopartiestothe

agreement.

Ontheonehand,theJordanianteamwasledbyMuhammedHalayqa,athenthirtyyear-

oldmanwhoarrivedathisroyallyappointedpostwithlittleinthewayoftradeknwoledgeor

bargainingexperience.WithJordaniancapitalandlaborequallydisorganized,moreover—and

therebyequallyirrelevantwhenitcametolobbyingandadvocacy—,Halayqawouldbedoinghis

jobwhilereceivinglittleguidancefromtheactorsmostlikelytobeaffectedbyhisdecision-

making.597Astheentirenegotiationprocesshadalsobeendesignedinsuchamannerasto

insulateitfromanyoversight,publicdebate,orcivilsocietyparticipation,itwouldonlyaslight

exaggerationtosaythattheKinghad,foralleffectsandpurposes,managedtoplacefateofthe

595 See:MohammedEl-Said,“TheEuropeanTRIPS-PlusmodelandtheArabworld:fromco-operationto

association—aneweraintheglobalIPRSregime?”,LiverpoolLawReview(28),2007,p.144.596 ThefirstiterationofJordan’sAssociationAgreementwiththeEU,signedin1997,actuallyprecededAbdullah’s

ascensiontothethrone.Thatsaid,thearrangementwaslargelynominalinnature(ElSaid,2007,p.149).597 Mohammedel-Said,“Themorningafter:TRIPS-Plus,FTAs,andWikileaks:freshinsightsontheimplementation

andenforcementofIPprotectionindevelopingcountries,AmericanUniversityInternationalLawReview(28:1),2012,p.81.

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entireJordanianeconomyinthegrosslyunpreparedhandsofHalayqaandco.alone.Making

mattersworsewasthefactthatHalayqawastobeopposedbythewell-resourcedandhighly

competentOfficeoftheUSTradeRepresentativeaswellasbythecoalitionofwell-financed

lobbyinggroupsthatweretohoverintheshadowsofthenegotiationsthroughout.598Most

prominentamongstthisconstellationoflobbyistswerethePharmaceuticalResearchand

ManufacturersofAmerica(PhRMA),theBusinessSoftwareAlliance,andtheInternational

IntellectualPropertyAlliance.599

Unsurprisinginviewoftheimbalanceofpowerandknowhowamongstthenegotiating

teams,thefinalproductofthesetradetalkswoundupanchoringJordantoamodeofglobal

integrationthatwashighlydisadvantageoustothecountry’slong-termdevelopment.600Central

tothiswereanotherseriesofIP-relatedprovisions—provisionsthatactuallywentwellbeyond

whattheWTOhadrequiredofJordan.

598 ThesespecialinterestsprovedequallyeffectiveinpushingrepresentativesofUSAid,theAmericanEmbassy,and

theUSPatentandTrademarkOfficetodotheirbiddingaswell(el-Said,2012,p.79). USAidwouldalsolatercontributetotheAmericansqueezeofJordanianpolicymakers.Inthemonthsfollowing

thenegotiations,AidmadeitseconomicandfinancialassistanceconditionaluponJordan’simplementationofthelegislativereformmandatedbyJUSFTAanduponJordanianregulators’earnestnessinrespondingtoAmericancomplaintsre:IPviolations(el-Said,2012,pp.98-99).

599 ElSaid,2012,pp.78,89. EvenprecedingtheJUSFTAnegotiations,PhRMAhadbeenextensivelyengagedinlobbyingtheEmbassyand

otherrepresentativesoftheAmericanstatetocrackdownontheIPclimateinJordan.Insodoing,theywereoftenrathershameless;ononeoccasion,PhRMAeventriedtosecureitselfaseatontheboardofJordan’sFoodandDrugAdministrationsothatitmightmoredirectlyoverseetheadministrationofIPregulations.

600 ItisworthnotingthatJUSFTAestablishedaprototypeforwhatwouldbecometheUnitedStates’preferred

strategywheninteractingwiththedevelopingworldinthe21stcentury.SubsequentbilateralfreetradeagreementswithMoroccoandBahraincloselyfollowedthetemplate.

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Tobegin,JUSFTAforcedJordantowaivethetenyeartransitionperiodthattheWTO’s

TRIPsAgreementalloweddevelopingnationswhenitcametoIPpolicycompliance.Next,it

institutedanumberofreformsregardingpatentprotectionandregulation,themostimpactfulof

whichrelatedtodataexclusivity.Inanutshell,JUSFTA’simpositionofdataexclusivitymeantthat

patentrightsweretobeextendednotonlytoaproductproper,butalsototheresearchdataand

theexperimentaltrialsthatneededtobepresentedinorderforthatproducttobesanctionedby

Americanregulatorybodies.Throughtheestablishmentoftheseprovisions,Jordanianbusinesses

werepreventedfromusingorreferencingpubliclyavailableexperimentaltrialsand/ordatafor

thepurposeofdevelopingcommercialproductsforuptoeightyears.601

601 ThekindsofR+Doperationsnecessarytorunsuchtrialsanddevelopone’sowndataareincrediblycapital

intensiveandwellbeyondthecapacityofJordanianindustry.Foralleffectsandpurposes,then,dataexclusivityhasmeantthatdomesticfirmsarenolongerlegallyabletoproducegenericversionsofproductsanywhereneartheglobaltechnologicalfrontier.

See:El-Said,2012,p.82

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FortheJordanianpharmaceuticalindustry—oneoftheeconomy’spreviouslyrising

stars—,dataexclusivityprovedcataclysmic.Asmentioned,priortoJUSFTA,thebusinesses

operatinginthissectorhadrelieduponaunique,localizedkindofsecondmover’sadvantage.

Morespecifically,theyhadreliedontheirtheircapacitytotobringagenericversionofanew

product(oncetheinitialpatentexpired)toregionalmarketsbeforeanyoneelse.602Whilenot

doingtheinnovationthemselves,thisstrategywasaneffectiveintermediatestepthatallowed

602 Intheseyears,thecountry’spharmaceuticalfirmsconsistentlymanagedtodeliver(andexport)agenericversion

ofanewdrugdevelopedinthewestwithinsixmonthsofthelatterhittingtheshelf.

The WTO, TRIPS, and Jordan Ascomparestothecountry’sbilateralFTAs,theimpactthatWTOaccessionwouldhaveontheJordanianeconomywasfarlessdestructiveinnature.Firstly,themultilateralnatureoftheWTOinsuredthatthenegotiationsdeterminingthecontentofitsagreementswerenotwhollybiasedagainsttheinterestsofthedevelopingglobalsouth(ElSaid,2007,p.144).Infact,itwasthisverymultilateralismthatmadetheWTOattractivetodevelopingcountriesinthefirstplace,allowingthemtopooltheirresourcesandtoleveragethenegotiatingpowerthattheirmarkets,intheaggregate,affordedsotocollectivelybargainagainsttheUSandEU.Tonosmallextent,theWTOallowedtheglobalsouthtostaveoffthe“competitiveliberalization”thatisinherenttobilateralism,tosavethemselvesfrombeingindividuallysteamrolledthroughone-on-onedealingswitheconomicmegapowers(Ibid,p167). Collectiveactiononthepartofthedevelopingworldyieldedanumberofpositiveresults.Forinstance,whilethe1989-1990UruguayroundofWTOnegotiationsdidbringTRIPSintoeffect,italsoprovidedforanumberofexemptionsandtransitionalconditionsthateasedtheburdenfordevelopingcountries.Specifically,Article65ofTRIPShadlitigatedagraceperiodoffiveyearsbeforeacountrywouldneedtocomeintocompliancewiththerequisiteIPregulations(agraceperiodextendingtotenyearsinthecaseofproductpatents).Inaddition,theWTOaffordeddevelopingcountriessomewhatfairhearingswithintheWTO’smultilateraldisputesettlementsystem(Ibid,p.159).OfgreatimportancefromtheperspectiveofJordanianpharmaceuticalcorporations,theTRIPSagreementdidnotincludedataexclusivitywithinitspatentregulations.Inpractice,dataexclusivityisa“procedurewhereinoriginativepharmaceuticalcompaniesaregrantedaperiodoftimeduringwhichwould-begenericproducersofexistingdrugsareprohibitedfromobtainingregulatoryapprovalforacompetingdrugiftheyrelyontheresultsoftheoriginator’sclinicaltrials”(el-Said,2012,p.85).HavingalsoprovidedanumberofotherexemptionsmeanttoinsurethatIPregulationsdidnotimperilpublichealthornutritionintheglobalsouth—specifically,TRIPSprovidedforcompulsorylicensing,parallelimports,tieredpricingordifferentialpricingsystems,andforthestate’sregulationofnationaldrugpriceparticulardiseasesinthecaseofnationalemergency(elSaid,TRIPSinJordan,445)--multilateralismmostcertainlyeasedthepainofglobalintegration,atleastcomparativelyspeaking.

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Jordanianindustrytocarveoutanichepositionwithinglobalandregionalsupplychainsandto

engagewithandlearnfromcuttingedgeproducts.Profitableasthestrategywas,moreover,it

alsofacilitatedcapitalaccumulationinamountsthatwouldhaveallowedlocalfirmsto

(eventually)investinlucrativethoughexpensiveR+Doperations.Subsequenttothe

establishmentofJUSFTA—andtheinstallmentofdataexclusivity—,however,whereitoncetook

aJordanianfirmsixmonthstobringagenericversionofanewdrugtomarket,itwouldnowtake

nineyears.603Byconsequence,theexportsofJordanianpharmaceuticalfirmswouldstagnate,and

theirdomesticsaleswoulddropprecipitouslyaswell.604

Movingbeyonddataexclusivity,JUSFTAalsoprovided“newuse”patentprotectionsfor

chemicalentities,aprovisionthathasenabledevergreeningstrategiesofahighlycynical

nature.605AgainincontrasttotheWTO’sTRIPSagreement,JUSFTA’sTRIPsPLUSdelineated

603 See:El-SaidandEl-Said(2007),p.463.604 Abriefsurveyofgrowthandprofitratesamongstthosepharmaceuticalcompaniesthatarepubliclytradedon

theAmmanStockExchangeoverthepastthreeyearsgivessomeindicationofthiscrisis.605 See:El-Said,2012,pp.82-91. Asthishasplayedoutinpractice,wheneveranAmericanfirmhasseenthepatentonanoldchemicalproduct

approachitsexpiration,ithassimplydiscoveredanddefinedanewuseforthatproductandtherebyearneditselfanadditionalthreeyearsofpatentprotections.Whentimedappropriately,Americancorporationscanevenstaggerthediscoveryof“newapplications”sotobuildonethreeyearextensionafteranother.

TherehavebeenanumberofexamplesofthisintheJordanianmarket.Inoneinstance,anAmerican

pharmaceuticalcompanyintroduceda(patented)medicinethathadbeenexplicitlydesignatedforadults;upontheexpirationofthispatent,however,theyintroduceda“newuse”throughrepurposingandrecalibratingthedosageofthismedicine,firstforchildren(therebyextendingthepatent)andthenagainfornewbornsthreeyearsfollowingthat.Anotherfamouscasefromthemid-2000ssawPhRMAanditsagentsintheUSEmbassyadvocateforapatentextensiononananti-asthmamedicineafteritwasdiscoveredthatthedrugcouldtreatasthmaandallergicrhinitis;onthisoccasion,atleast,theJordanianFDAmanagedtoshutthemdown.

Generallyspeaking,however,knowingfullwellthatJordaniancompaniesdon’thavethelegalbudgettocontest

thesemachinationsthroughthevariousdisputeresolutionmechanismsestablishedunderJUSFTA,theseploysoftengouncontested(onthislastpoint,see:El-SaidandEl-Said,2007,p.458).

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ratheraustererestrictionsoncompulsorylicensing.Specifically,wheretheWTOhadassigned

memberstatessignificantdiscretionarypowerwhenitcametodefiningthoseconditionsunder

whichlicensingcouldbebroughtintoeffect—andtherebyprovideddevelopingstateswitha

mechanismfordealingwithpotentialhealthcrises—,JUSFTAstipulatedthatafirmcouldonlybe

forcedtolicenseitsproductafteran(American-dominated)arbitrationprocessdeterminedthat

theanarrowsetofcriteriahadindeedbeensatisfied.606Inpractice,duetothefactthatPhRMA

hasprovenunsurprisinglydexterousinnavigatingthesearbitrationproceedings,American

pharmaceuticalcompanieshaverarelyhadtoabidebytheJordanianMinistryofHealth’sappeals

foremergency-basedcompulsorylicensing.

Finally,itworthnotingthatJUSFTAalsoreversedprevailing(andWTO-sanctioned)

practicesasconcernstheenforcementofIPregulations.Wheremuchofthelegaland

administrativeburdenhadoncebeenplacedonthepatentholder,JUSFTArequiredthatthe

Jordanianstateadoptasortofpre-emptive,Panopticon-styledrole.Specifically,Article4.26of

JUSFTAobligatestheJordanianstateto“initiatecriminalproceedingsandbordermeasures

againstinfringementsoftrademarks,whicharedirectlyrelatedtopharmaceuticalproducts,even

intheabsenceofaformalcomplaintbyaprivateparty.”607Foralleffectsandpurposes,JUSFTA

606 See:El-Said2012,p.88. Specifically,thesecriteriadictatethatlicensingmayproceedinorder“toremedyapracticedeterminedafter

judicialoradministrativeprocesstobeanti-competitive,incasesofpublicnon-commercialuseorinthecaseofanationalemergencyorothercircumstanceofextremeurgencyprovidedthatsuchuseislimitedtousebygovernmententitiesorlegalentitiesactingundertheauthorityofagovernment.”

607 El-SaidandEl-Said,2007,p.449.

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thuslyrenderedtheJordanianDrugInspectionAgencyanditsMinistryofIndustryandTradeinto

asortofpatentpoliceforAmericanpharmaceuticalcompanies.608

ThetradepoliciesadoptedbyGenerationAbdullah—policiesenshriningadevelopment

strategybasedonstaticcomparativeadvantageandrespectforinternationalintellectual

propertylaw—have,atoneandthesametime,managedtolockJordanintocommodity

extractionandlowvaluemanufacturingwhilealsoundercuttingthosetechnologically

sophisticatedindustries(suchaspharmaceuticals)thathademergedacrossthe1970s,1980s,

and1990s.Contrarytothepromisesmadebytheirevangelists,saidpolicieshavealsoimpeded

therealizationoftechnologicaltransfersanddeliverednegligiblegainsintermsofinvestment

intoresearchanddevelopment(seeboxbelow).CentraltotheexternalarticulationofJordan’s

contemporarySSA,suchpoliciesarethereforefundamentaltothecrisiscapitalismthathas

prevailedacrossthemajorityofAbdullah’stenure.

608 Jordan’sAssociationAgreementwiththeEuropeanUnion—whichwasamendedandreinstatedin2002—,also

contributedtoanemergentmodeofglobalintegrationthatwouldprovehighlyunconducivetoJordan’slong-termdevelopment.Tobegin,thisagreementwouldlargelyreinforcetheTRIPS-PlusregulationsthathadalreadybeenimposeduponJordanthroughJUSFTA.Inonesense,theAssociationAgreementevenwentbeyondtheAmericaniteration.Specifically,theAgreementwiththeEUstipulatesthatJordanharmonizeitsIPLawtothe“highestglobalstandards.”Insodoing,theEUdelineatedadynamicandopenhermeneuticalframework,onethatcouldbereinterpretedacrosstimesotopushJordanintocompliancewithwhatevernewregulationsmightemergeinthosepartsoftheworld(thecore)whereIPlawactuallyisquiteimportant(Nesheiwat,365).Inaddition,itisalsoworthnotingthatboththeAssociationAgreementandtheEU’sBarcelonaInitiative—whichrepresentedtheUnion’seffortstoestablishafreetradeareawithinthegreaterMediterranean(inclusiveofJordan)—excludedagriculturalproductsfromtheremitoffreetrade.TherebyexcludingtheonesectorwhereArabcountrieslikeJordanactuallyheldastaticcomparativeadvantagevis-a-vistheirEuropeancounterparts,thecynicismanddisingenuousnessoftheEU’seconomicengagementwiththeMiddleEastwouldbeonlyfurthercompounded(ElSaid,148).

WhiletheJordanCompactandsimilarEU-ledresponsestotheSyrianrefugeecrisishavehintedatthepossibility

ofEuropeopeningitsmarketstoJordanianexportstoalargerextent,suchhintshaveyettotranslateintomaterialchangeatthetimeofwriting.

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Trade,IPCompliance,andUnderdevelopmentinJordanandtheGlobalSouth

CompliancewithTRIPSPlusinJordanhasprecipitatedneitheranincreaseinFDI,anincreaseinFDIallocationsintoR+D,noranincreaseintechnologicaltransfers.609TheFDIthecountrydoesreceive,moreover,continuestohailalmostexclusivelyfromtheGulfandcontinuestobeallocatedalmostexclusivelyintospeculative,lowsophisticationspacessuchasthebuiltenvironment,commodities,andlowcomplexitymanufactures.610Intheaggregate,then,tradepolicyhasfunctionedsotostuntJordan’stransitiontowardsaknowledgeeconomywhilealsounderminingthecountry’smovementmovingtowardsahigh-sophistication,high-complexityexportbasket.Whatismore,itisimportanttoemphasizethatsuchoutcomesarenotaberrational;rather,theyarethenecessaryoutcomeofamodeofglobalintegrationthathasbeenpremisedona(wittingorunwitting)misunderstandingofIPcostsandbenefitsintheglobalsouth. Sowhy,then,doesn’tIPprotectiondowhatitsideologicalsponsorsclaimitwilldo?Toanswer,this,oneneedfirstrememberthathistoricallyspeaking,theftandtheexploitationofforeigntechnologieshasbeenanecessary(ifnotsufficient)precedentconditionforeconomiccatch-up.Priortoreachingtheglobaltechnologicalfrontier—anduntilone’sendogenoushumancapitalreachesalevelwhereitcaninnovateandoperatenewtechnologiesonitsown—,borrowingandstealingfromabroadarethereforeessentialfortheadvancementofadevelopingeconomy.Thisbeingthecase,themilitantenforcementofIPregulationsthatisinstitutionalizedthrougharrangementslikeJUSFTAhavefunctionedsotodelayJordan’stechnologicalconvergence—sotokickawaytheverylatterthattheUnitedStatesamongstothershasusedinbuildingitselfintoaneconomicsuperpower. Inaddition,thoughwesterntraderepresentativeshavelegitimatedaggressiveIPregimesontheclaimthattheyfacilitateFDI-inflowsandtechnologicaltransfersintothedevelopingworld,thispropositionhasbeenfalsifiedbyanumberofdifferentstudies(inadditiontobeingrefutedbytheJordanianexample).Empirically,thecorrelationbetweenstrongIPregulationsandFDIinflowsinthedevelopingworldisstatisticallyinsignificant;therelationshipbetweenIPregulationsandtechnologicaltransfers,moreover,isalsonegligible. Logically,thesenon-relationshipscanbeexplainedbythefactthatforeigninvestmentisonlysensitivetoIPrightstotheextentthatthereceivingeconomyissensitivetoIPrights.ArecipienteconomycanbedeemedinsensitivetoIPrightsifitislackingtheendogenouscapacitynecessarytoengagewithfrontiertechnologiesandproductiontechniques.Incircumstancesuchasthese(andsuchasJordan’s),technologicallysophisticatedfirms(rightly)perceivethatthereisnobenefittobegainedfrommovingtheirinvestmentandoperationsintoarecipienteconomy611;thisbeingthecase,theimpositionof

609 ElSaidandElSaid(2007),pp.455-456.610 WesternoriginatingFDI,whichonecanassumeismorelikelytobeaccompaniedbytechnologicaltransfers,

comprisesatinyfractionofJordan’stotalFDI.See:Nesheiwat,p.388611 Anexamplemayhelpdemonstratethis.Regardlessofthequalityoftheinvestmentenvironment,whywould

AppleinvestR+Doperationsin,say,Kazakhstan,iftheeconomyisincapableofprovidingtherequisitepersonnel?Insuchacontext,promisesmadebytheOfficeoftheUSTradeRepresentative(andbyitscourtintellectuals)regardingthepositiveexternalitiesofIPregulationareunlikelytoberealized.Thebestthatcanbehopedforisthatamultinationalcorporation—seekingtoexploitwagedifferentials—decidestomovelow-skilled,technologicallynon-intensiveaspectsofitsproductionintotheaspiringhostcountrywhileretaininginnovative,technologicallyintensiveaspectsbackhome,wherethehumancapitalstockisalreadysufficientlyhigh.

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stringentIPregulationswillhavenoeffectonFDIinflows,assaidinflowswereneverforthcominginthefirstplace.612GiventhatimpositionofJUSFTA-styledpatentprotectionswerealreadycertaintoincreasethecostsbeingbornebyJordanianconsumersofpharmaceuticalgoods613,thatthesesameprotectionsfailtooffsetthesecostsbyfacilitatingincreasesinproductiveinvestmentrendersthemevenmoreproblematicfromadevelopmentperspective. Finally,itisalsoimportanttonotethatdevelopingmarketslikeJordan’sconstituteatinyfractionoftheconsumerbaseforIP-intensiveindustries.Thisbeingthecase,thenotionthatprospectiveviolationsofintellectualpropertyrightsintheglobalsouthmightconstituteadisincentivizeforinnovationbackinthewestiswhollynonsensical.Takingwesternbasedmultinationalpharmaceuticalcompaniesasanexample,theiraggregatesalesacrosstheentireArabworldcomprisedamere2%oftheirtotalsalesasof2007(443).614Duetothelowincomelevelsthatarewitnessedintheregion,moreover,thosenumbersdropdowntonearzerowhenitcomestothemoreexpensive,innovative,patent-protectedproductsthatthoseMNCsdevelop.ToevokeutilitarianargumentsandtosuggestthattheliberalizationofmarketslikeJordanandtheaustereenforcementofIPrightsthereinaresomehownecessaryfordrivinginnovation,then,istoengageinwillfulmisdirection.615

612 See:Nesheiwat,p.364 Thecorporatestructuresofcontemporarymultinationalcorporations(MNCs)alsocontributingtothenon-

correlationbetweenIPregulationsandtechnologicaltransfers.InplaceslikeJordan,totheextentthatMNC’sinvestatall,theystructuretheirinvestmentinsuchamannerastoprecludetechnologicaltransfer.AswaslongagotheorizedbyHymerthroughhisworksontheinternationalizationofthefirm,thisfollowsfromthefactthat“technologyconstitutestheprimaryfirm-specificadvantageofthemultinationalfirm,andnosuchfirmwilltransfersuchtechnologyevenwhenpropertyrightsarewelldefined”(TRIPSinJordan,454).Thespatializationofcontemporaryproduction,afterall,notonlyallowsandencouragescorporationsintheglobalcoretooutsourcesomepartsofitsoperations—assembly,forexample—toperipherallocationswherethepriceoflaborischeaper.Italsoallowsandencouragesthosesamecorporationstoretaintheinnovativepartsoftheoperationbackhome,wheretheendogenoushumancapitalstockisalreadyhighandwheretheyneednotfearthattheirIPwillbeexposedinanundesirablefashion.

InJordan,thiskindoftechnologicalprotectionismhasoftentakentheformofjointventures.Byarrangingjoint

venturesratherthanlicensingorfranchisingagreements,MNCsareabletoretainalltheirIP(ifnottheirproduction,too)athomewhileusinglocalactorsasdefactosalespartners.TheproductremainsthatoftheMNC’s,whilethelocalactorsprovideknowledgeofandaccesstoregionalmarketsthattheMNClackstherequisiteexpertiseon(ElSaid,InstitutionsandJointventures,p.68,76).

613 AsamassiveOxfamStudyfirstestablished,by2007,TRIPSPlusrulesandtheabsenceofgenericalternatives

resultedina20.5-47.9%increaseinpricesfornewdrugs(461).Asthesepriceincreasesoccurredwithinthewidercontextofhighpovertyratesandlowratesofhealthinsurance,theyresultedinpeoplerationingtheiruseofmedicine.Ratherthantakethethreedailytabletsthathadbeenprescribedbyadoctor,patientsmighttakeoneandhopeforthebest,asa2004HumanDevelopmentReportharrowinglydocumented(462).

614 See:El-SaidandEl-Said(2007),p.443. Thisissodespitethefactthatimportedmedicinesrepresent90%oftotalmedicineconsumptionintheMiddle

East.615 Inthesecontexts,marketrationalitiesinsure—andempiricalevidenceverifies—,thatthelivesofpeoplethere

arenotvaluableenoughtoinvestR+Dtowardssaving;profitseekingwillleadfirmstowardsinvestinginmedicinesforerectiledysfunction,plagueofthewealthy,beforeitdoesthemedicinesthatcanbeaffordedinaplacelikeJordan.

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BudgetPolicy

BeforeturningtomyanalysisoftheconsequencesyieldedbyJordaniantradepolicy,I

wanttoclosethissectiononthejuridicalinstitutionalizationofthecountry’seconomicopening

bybrieflyconsideringthestate’sexternalbudgetarydependenceandhowthismayrelatetothe

externalarticulationofthecountry’sSSAaswell.

Intermsofscope,asthechartsonsubsequentpagesdemonstrate,thebasicsolvencyof

theJordanianstatestillverymuchdependsonitsabilitytoaccessexternalbudgetsupport.At

thetimeofwriting,Jordanisoneofthelargestrecipientsofofficialdevelopmentaid(ODA)inthe

world.AccordingtoOECDdata,in2017,thiscountryofroughlytenmillionpeopleactually

managedtorankseventhintheworldingrossODAreceived.Unsurprisinggiventhecountry’s

relativelydiminutivesize,thelocalimpactoftheseinflowsisratherstaggering:in2017,NetODA

constituted7.32%ofthecountry’sGrossNationalIncome.Whilethesefiguresrepresentaslight

increaseascomparestoAbdullah’sfirstdecadeasKing,theyarenotoutsidetheboundsof

normal.

DataprovidedbyOECDdatabase

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SourcesofJordanianODA,2015-2016(Unit:MillionsUSD)

DataprovidedbyOECDDatabase

Asthesetablesevince,GulfmonarchiescontributeasizablechunkofJordan’sannual

ODA.616TheaggregatetransfersprovidedbytheArabCoordinationGroup—whichrepresentsthe

616 GivingsomeindicationofhowessentialGulfaidistotheHashemitesurvivalstrategy,itisworthnotingthat

Abdullah’sfirstactasKingsawhimtraveltoSaudiArabiainhopesofhealingtheriftsthathadopenedduringthelatteryearsofhisfather’srule(Anani,p.186).WhilerelationsremainedsomewhatcoolwithKuwaitpriorto2012,hewaslargelysuccessfulintheseregards.Thoughinconsistent,externalofficialaid,budgetarysupport,

335

combinedeffortsoftheKuwaitFundforArabDevelopment,theSaudiFundforDevelopment,and

theAbuDhabiFundforDevelopmentaswellasregional,Gulf-basedfinancialinstitutionssuchas

theArabFundforEconomicandSocialDevelopment,theIslamicdevelopmentBank,theOPEC

FundforInternationalDevelopment,theArabBankforEconomicDevelopmentinAfrica,the

ArabGulfProgramfortheUnitedNationsDevelopmentOrganizationsandtheArabMonetary

Fund—areratherastounding.InadditiontoODA,moreover,theGulfmonarchieshavealso

suppliedmorediscretionaryformsofdirectbudgetsupporttoJordan,particularlyintimesof

heightenedpoliticaltensions.Forinstance,between2011-2016alone,thetriumvirateofSaudi

Arabia,theUAE,andKuwaitprovidedtheJordanianstatewith$3.75billioninannualtransfers,

loans,andgrantsofdifferentkinds.Markingtheendofalongperiodofnon-engagement,

Kuwait’sparticipationintheseinitiativeswasespeciallywelcomeinAmman.617Inaddition,

thoughthedeliveryofthesepledgescannotyetbeverified,itisworthacknowledgingthatSaudi

Arabia,Kuwait,andtheUAEalsopromisedanadditional$2.5billioninaidinJune2018after

protestsoveraproposedincometaxlawshooktheKingdom’sfragilesocialecosystem.618

ComplementingifnotexceedingtheGulf-basedODAandbudgetarysupporthasbeenthe

financialcommitmentsoftheUnitedStatesgovernment.Rampedupduringthemanyescalations

andoff-the-bookstransfersfromtheGulfhavehelpedsolidifyhisbudgetsecurity—and,insodoing,furtherconsolidatedtheregime’spolarized,inequitablefiscalsociology—acrossthepasttwentyyears,particularlyinmomentsofpoliticalcrisis.Withouttheseinjectionsofcapital,theKing’sstrategyindealingwiththeArabUprisings—wherehecombinedareintroductionofsubsidieswithincreasesinpublicsectorhiring—wouldhavebeenimpossible.

617 KuwaitiaidtoJordanhadceasedfollowingthefirstGulfWar.Forthishistory,see:Coestier(2015),p.16.618 Ontheseevents,see:AliYounes,“WillGulfaidpackagehelpresolveJordan’seconomiccrisis”,AlJazeera(June12,

2018).

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inthewaronterror—firstfollowingZarqawi’s2005attacksinAmman,laterfollowingthe

emergenceoftheDa’esh—,itcouldbearguedthatAmericaninflowsevenconstitutethemost

dependablecomponentofthePalace’spost-2001budgetstrategy.Goingforward—andas

establishedunderthetermsofaMemorandumofUnderstandingsignedinFebruaryof2018—,

upandthrough2022,theUnitedStateswillbeproviding$1.275billioninannualbilateralforeign

assistancetoJordan.Thisrepresentsa27%increaseascomparestotheUS’spreviousannual

commitmentstoJordan.$910.8millionofthispackagewillbedevotedtoanEconomicSupport

Fundwhile$350millionforForeignMilitaryFunding.Seethegraphbelowforadetailed

breakdownofhowUSODAwillbeallocatedin2019.

BudgetRequests,2019;Chartand

dataprovidedbyDepartmentofState

(foreignassistance.gov).

IDAandbudgetsupportdisbursedbyEUinstitutionsandEUmemberstateshasalso

helpedmakeupbudgetshortcomings.TheaggregatereceiptsdisbursedfromEUmemberstates

in2017totaledroughly$775million,withanother$240millionwasprovidedthroughEU

institutions.

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Turningtomoreindirectformsofbudgetsupport,oneneedbeginwiththecontributions

ofUNRWA.In2017,theorganizationdevoted$175.8millionofitstotalbudgettoJordan-based

operations.619Designatedforthecountry’smanyPalestinianrefugeecamps,thisallotment

financedtheeducationof121,368elementaryandsecondaryschoolagedstudents,1.5million

annualpatientvisits,basicwelfareservicesfor58,915,andprovidedfor$14millioninloansto

smallbusinesses.620UNHCR—thechiefUNagencyresponsibleforhandlingtheSyrianrefugee

crisiswithinJordan(aswellasforhandlingsmallerrefugeepopulationsfromYemen,Iraq,Sudan,

andSomalia)—runsanevenbiggeroperation.Withover550staffandalegalmandatetoprovide

healthservices,educationservices,cashassistance,jobtraining,housing,andothersupportsfor

762,420people,theUNHCR’sspendinginJordanhasroutinelyexceeded$300millionduringthe

post-2012period.In2019,itsproposedbudgethasclimbedallthewayto$371.8million.621As

eachoftheseinstitutionsfunctionasexternallyfinancedparallelstates—statesthatare

fundamentaltothesocialsecurityoflargesegmentsofJordan’sterritorialresidents—,they

representcritical,externalmechanismsbasictothestabilizationofcontemporaryJordanian

capitalism.622

Finally,onewouldberemissinconsideringthebudgetaryaspectofjuridical

institutionalizationifonedidnotalsoaccountfortheconcessionaryloansdisseminatedtoJordan

619 Sharp(2018),p.10.620 FiguresdrawnfromUnitedNationsReliefandWorksAgencyforPalestineRefugeesintheNearEast,UNRWAIn

Figures,June2017.621 Byconsequenceofthefactthatthecamp-basedpopulationofnon-Palestinianrefugeesisonly17%,farfewer

thanthisnumberarelikelytobeactuallyreceivingUNHCR’sservices.622 FiguresdrawnfromUnitedNationsHighCommissionerforRefugees,FactSheet:Jordan,February2019.

338

throughtheIMF’svariouslendingdevices.Accompaniedbymorestringsthanaretheinflows

fromtheGulf,theUS,andtheEU—atleastasregardseconomicpolicymaking—,thesecapital

injectionsareperhapsthemostimpactfulwhenitcomestotheorientationofJordan’sinvestment

andindustrialpolicies.

Jordan’sArrangementswiththeIMF

FigureslistedareinthousandsofSpecialDrawingRights(SDRs)

ThoughsurelymorehaphazardthanthePalacewouldprefer623,thebudgetsupport

arrangementsthathavebeenarrangedbythestateoverthepasttwentyyearshave

unambiguouslyaffectedtheexternal(andtheinternal)articulationoftheJordanianSSAina

numberofways.Asthetablebelowevinces—atablethatisonlyinclusiveofbilateralformsof

ODA—,thesearearrangementsthatcontinuetounderwritesubstantialportionsofthestate’s

current,capital,andsocialexpenditures.624Totheextentthatsuchexpenditureshelpsustain

623 Itshouldbeacknowledgedthatpledgesofaidfrequentlygopartiallyfulfilled(iffulfilledatall).Thishascertainly

beenthecasewiththeinternationalcommunity’sresponsetotheSyrianrefugeecrisis.624 AstheexamplesofUNRWAandUNHCRevince,foreignpartnersandinternationalinstitutionsarealsodepended

uponwhenitcomestotheimplementationofsocialinterventions.

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lowerclasslifeinparticularthroughensuringthatbasiclevelsofpubliceducation,health,and

welfarearemaintained,ODAallowsthestatetobothmanageenduringhumanitariancrisesand

staveoffmassdeprivation.Therebypre-emptingthesocialdisruptionsthatmightotherwise

emerge,ODAtoocontributestothestabilizationofcapitalaccumulationinJordan(ifalsotothe

state/economy’sdependentcondition).

AllocationsofBilateralOfficialDevelopmentAssistance(USDmillion)

AnnualAverage:2015-2016

Subsection2

(1)ExpandingTradeDeficits

AnyauditingofJordan’sintegrationwithregionalandglobaleconomieswouldneedto

startwiththecountry’sexpandingtradedeficit.Byconsequenceofpoorlyconsideredtrade,

investment,andindustrialpolicies,bothtermsoftradeandcurrentaccountdeficitshave

worsened(andconsiderablyatthat)acrossthetenureofAbdullah.

340

341

DataforgraphsprovidedbyCentralBankofJordan

(2)Decliningcomplexityinthenationalexportbasket

Partandparcelofthisexpandingtradedeficit—andperhapsevenmorereflectiveofthe

flawsinherenttothestate’strade,investment,andindustrialpolicies—isthedeclining

complexityofJordan’sexportbasket.Thisdeclinehasbeenquitethoroughlydocumentedbythe

ObservatoryofEconomicComplexity.Afterclimbingallthewaytonumbertwentyinthe

EconomicComplexityIndex’srankingsofexportbasketsasof1980,Jordanhenceforthwitnessed

asteady(andoccasionallyprecipitous)decline.DuringAbdullah’stenureinparticular,whatearly

progresswasachievedvis-a-visexportcomplexityinhisinitialyearsinpower(2000-2009)were

summarilyunwoundintheeightyearsthatfollowed.Ineachyearsince2012,infact,the

complexityofJordan’sexportbaskethaddeclinedbynon-insignificantmargins.Byconsequence,

342

asof2017,thecomplexityofJordan’sexportbaskethadplummetedtoarankingofsixty-fiveout

oftheonehundredandtwenty-nineincludedintheindex.

TheEconomicComplexityIndex

TheEconomicComplexityIndex(ECI),aprojectjointlyhostedbyMIT’sMediaLabandtheGrowthLabatHarvard’sCenterforInternationalDevelopment,wasprimarilydevelopedbyRicardoHausmanandCesarHidalgo.Designedtohelpresearchersandpolicymakersidentifyhowaneconomycanmovebeyonditsstaticcomparativeadvantagethroughexploitingopportunitiesfordiversificationandforcomplexification,theECIismeanttofunctionasaroadmapofsorts,oneindicatinghowacountrycangetmoreoutofinternationaltradethroughgraduallymovingintotheproductionofhighersophisticationexports. ThisECIroadmapisfoundedonanumberofpremisesandtheoreticalassumptions.ThefirstisgroundedinaDurkheimianunderstandingofthedivisionoflabor.Specifically,HausmanandHidalgopositthatthe“complexityofaneconomyisrelatedtothemultiplicityofusefulknowledgeembeddedinit”andthat“foracomplexsocietytoexist,andtosustainitself,peoplewhoknowaboutdesign,marketing,finance,technology,humanresourcemanagement,operations,andtradelawmustbeabletointeractandcombinetheirknowledgetomakeproducts”(p.18).Fromthispointofdeparture,thescholarsassertasecondpremise,onepositingthatacountry’sendogenousknowledgebasewillbeexpressedandrevealedinthe“compositionofacountry’sproductiveoutput.” Critically,however,HidalgoandHausmanarealsokeentoemphasizethatthistranslationofknowledgeintoproductswillnotbeautomatic.Integratingtheoreticalinsightsfrominstitutionalistschoolsofeconomicdevelopment,theyassertthatthistranslationprocesswillalwaysbemediatedandaffectedbymattersofgovernance,law,regulation,andthelike.Ifappropriateinstitutionalconditionsareinplace,acountry’sproductiveoutputwillrathercloselyreflecttheknowledge(oraggregatehumancapital)embeddedinthissociety.Likewise,ifinstitutionalconditionsareinappropriate,thecomplexityofacountry’sproductiveoutputmaybeincommensuratewiththatcountry’sendogenous,knowledgebase. Suchadivergence—andsuchinstitutionalfailure—canbedeterminedbycomparingthecomplexityofacountry’scurrent(orpast)productiveoutputagainstaprojectionofwhatthatcomplexitycouldbeincircumstanceofidealgovernance.ThisprojectioncanbefoundintheECI’sGrowthProjectionIndex,whichattemptstomodelwhereacountry’sexportbasketshouldbebasedonthecontemporaryhumancapitalstock. AsforhowthecomplexityofproductiveoutputisactuallydeterminedontheECI,HidalgoandHausman’sformulalargelyreducestotwomeasures:diversityandubiquity.Therelationofdiversitytocomplexityisbasedontheassumptionthatgreaterlevelsofhumancapital(andamoreprecisedivisionoflabor)willresultinagreaternumberofdistinctproductsbeingdevelopedatanygiventime.Thisbeingsaid,thescholarsalsorecognizethatdiversityaloneisinsufficientforcapturingthemultifacetednatureofcomplexity.Afterall,itismorethanpossiblethatarelativelysimpleeconomywitharelativelylowlevelofembeddedknowledgemightstillprovecapableofexportinghundredsofdifferentkindsoflowsophisticationwidgets,agriculturalgoods,orcommodities. (CONTINUEDONNEXTPAGE)

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The Economic Complexity Index (Continued) Sotocontrolagainstsuchamisleadingoutcome,asmentioned,ubiquityisinsertedasasecondmeasure.Mostsimplyput,theubiquityofaproductisdeterminedbymeasuringthenumberofcountriesthatproduceagivengoodatagiventime.Followingfromtheassumptionthatastheknowledgeintensityofaproductincreases,thenumberofcountriescapableofproducingsuchaproductwilldecrease,ubiquityprovidesaneffectivehedgeagainstdiversity’sincompleterelationtocomplexity.Itshouldalsobeacknowledgedthatthediversitymeasurefunctionsasthesamehedgeforubiquity,justintheinverse.Afterall,itisequallyeasytoenvisionascenariowhereanationaleconomymightbehometoanextremelyrarecommodity;whilethisnaturalinheritanceimpliesalowlevelofubiquityfortheproduct,therarityofcoltan,forinstance,haslittletodowiththecomplexityofthegood,orwiththehumancapitalstockinvolvedinitsproduction.Byaccountingfortheextenttowhichsuchcommodityisrefinedintodifferentproducts—i.e.thediversityofproductiveoutput—,onecancontrolfortheeffectthattherandomdistributionofcommoditiesmighthaveoncomplexitycalculations.Onlybytriangulatingubiquityagainstdiversityandviceversa,then,canareliableproxyforcomplexitybeestablished. Fortheactualmathematicsinvolvedinthecalculationofproductcomplexity,seethetechnicalboxonthenextpage.Mostgenerallyput,productcomplexityisdeterminedbymeasuringtheweightedaverageofGDPpercapitaforeachcountryexportingacertainproduct—wherebyeachcountryisweightedaccordingtoitsshareoftotalworldexports.Thisweightedaveragegivesanindicationofthecompanyoneiskeepingwithinparticularexportmarkets,locatingacountry’smostrelevantcomparatorsandreverseengineeringtheendogenouscapacityofthenationaleconomyinsodoing.

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*Technicalboxprovidedby:RicardoHausmann,CesarHidalgo,SebastianBuston,MicheleCoscia,SarahChung,JuanJimenez,AlexanderSimoes,MuhammaedYildirim,TheAtlasofEconomicComplexity:MappingPathstoProsperity,MITPress(2014),p.24

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RankingJordan’sEconomicComplexityAcrossTime

GraphprovidedbyEconomicComplexityIndex,MITMediaLab/HarvardCenterofInternationalDevelopment

346

Whenoneactuallydisaggregatesthecountry’sexportbasketintoitscomponentparts,the

logicbehindsuchadeclinerevealsitself.Ihavealreadydiscussedhowtheexportprocessing

zonesthatareattheheartofcontemporaryindustrial,investment,andtradepolicygeneratelittle

beyondlowskill,lowsophisticationgarmentexports.Combinethoselowcomplexityproducts

withthoseofanagriculturalsectorreliantupontheexportofnon-processed,water-intensive

produceandanindustrialsectorstilldependentonvolatilecommoditieslikephosphatesand

potash625andonecanseehowthecountry’swiderexportbasketcomestocontainlittleinthe

wayoftechnologicallysophisticated,capital-intensiveoutputs.

Jordan’sExportBasketin2017

625 Aswellasthelowsophisticationsecondaryproductsthatcanbederivedfromsuchcommodities(suchas

fertilizer).

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Jordan’sExportBasket2017:ProductComposition

348

JordaninComparativeContext:Manufacturing626

626 DataforthesetwographsprovidedbyUnitedNationsIndustrialDevelopmentOrganization.

349

SiliconWadi?JordaninICTTrade627

627 DatafortwographsprovidedbyUnitedNationsConferenceonTradeandDevelopment

350

Tomakemattersworse,methodologicalchoicesattheObservatoryofEconomic

ComplexityhaveactuallyinflatedthecomplexityofJordan’scontemporaryexportbasket.

Specifically,theObservatory’scalculationsdonotappraisethecontributionsthatre-exports(i.e.

goodsnotappreciablytransformedwithinanationaleconomy)aremakingtothecomplexityofa

givencountry’sexportbasket.Giventhattheindexhadbeendesignedontheassumptionthata

country’sexportsoffersanexpressionoftheaggregateknowledgeendogenoustothatcountryat

agivenperiodoftime,theObservatory’sfailuretocontrolforre-exportspresentsapotentially

confoundingmethodologicalerror.Havingdiscernedthismethodologicalshortcoming,Ibrahim

SaifandtheJordanianStrategyForum(JSF)amendedtheObservatory’sformulasotocontrolfor

re-exports.Astheirresearchhasshown,bydiscardingre-exportsfromthecalculationof

economiccomplexity,thecomplexityoftheJordanianexportbasketdeclinesevenfurtherfrom

whathadbeenreportedattheObservatory.Basedonexportdatafrom2014providedbythe

DepartmentofStatistics,theiranalysisshowstheaveragecomplexityofaproductinthe

Jordanianexportbaskettoberoughly50%thenationalaverageofGermanandJapan.Thisislow

evenrelativetoregionalcomparatorslikeEgypt,whoseexportcomplexityexceedsJordan’sby

roughly20%.628

628 See:JordanStrategyForum,Jordan’sProductSpace:PartOne.Report,Amman(January2017),p.27. AccordingtotheECI’smetrics(thecalculationofwhichisdetailedextensivelyinAnnex1),theaverage

complexityofaJordanianexportwas9610.ThisfigurewasdepressedconsiderablybytheaveragecomplexityofJordan’sgarmentexports,whichhadavalueof4945.Forcomparison’ssake,theaveragesophisticationofaJapaneseexportinthissameperiodwas18,117;foraGermanexport,itwas17,781;foranEgyptianexport,itwas11,164;andforaMoroccanexport,itwas8704.

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Sadly,littleprogressbeenmadesinceSaifetalconductedtheiranalysis—despitethe

author’sconsiderablepoliticalconnectionsanddespitetheJSFhavingmadewide-rangingpolicy

recommendationsdesignedtohelpincreasethecomplexityofJordan’sexports.629Asthetables

onthefollowingpagesevince,Jordan’sexportbasketin2018remainswhollydominatedbylow

sophisticationgarments,chemicals,andagriculturalproducts.Structuringtheeconomytowards

adependenceonvolatilecommodities,foodstuffs,andlowvalue/lowsophistication

manufactures,Jordan’strade,investment,andindustrialpolicieshavecondemnedthecountryto

decadesofperditioninthelower-middleincometrap.

629 RegardingJSF’sefforts,theirstrategicdocumentdetailedandtargetedfivegoodswithineachexportsectoron

thebasisthat(1)thetargetsarebothproximate,orconnectedenough,toagoodcurrentlybeingproducedsoastobewithintheendogenouscapacityofthecurrenteconomyand(2)thatthetargetswouldofferanopportunityforaddingsophisticationtotheexportbasket.Forexample,thestudymightidentifytheproductionandexportationofcannedtomatoesasasimplewaytoaddcomplexitytoagood(rawtomatoes)alreadybeingexported.Inotherwords,theypresentedacomplexificationstrategywhollygroundedintheprinciplesofrelativecomparativeadvantage.FarfrommappingsomecoursewherebyJordanmightsomehowtransformintoafrontiertechnologicalhubwithinafewyears,theylayoutapragmatic,incrementalisttrack,onenotbasedonhugeleapsforwardbutsmallstepswhollywithinthecapacityofthecurrenteconomy,bethesestepssideward(diversification)orupward(sophistication)innature.Despitethehumilityoftheirrecommendations,theyhavestillbeenignored.

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GraphprovidedbyJordanStrategyForum,Jordan’sProductSpace:Partone,p.7

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TablesprovidedbyJordanianDepartmentofStatistics

(3)Gulf-basedinvestorsacquiringofincreasingsharesofthedomesticcapitalstock-->FDI’s

allocationintonon-productivesectors

TheliberalizationofJordan’scapitalaccount,aswellasthevariousinitiativesthrough

whichthecountry’spolicymakershaveattemptedtorecruitforeigndirectinvestment(FDI),have

notyieldedinvestmentinflowsconducivetolong-termdevelopment.Ratherthanfacilitatethe

kindsofinvestmentthatarepropitioustotechnologicaltransfers—andratherthanconditionalize

theincentivesofferedtoforeigncapitalsotopushinvestmentintoproductivesectorsandhigh

complexityactivities—,thisdimensionofJordan’seconomicopeninghasprimarilyfunctionedso

toexpeditetherecyclingofGulf-originatingpetrodollars.Ashasbeenmentionedthroughoutthis

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text,suchpetrodollarsaretypicallyfunneledintoeitherspeculativeprojectsinthebuilt

environmentand/orcommodityextraction.630Evidenceofthis,datafromtheFinancialTimes

establishesthatafull40.7%ofaggregateFDIinthe2003-2015periodendedupallocatedtothe

Jordanianrealestatesector;another29.6%flowedintotheoilandgassector,while9.1%was

directedintochemical-basedcommodities.631

Suchdevelopmentallyspuriousallocationarypatternsareevenmorepronouncedinthe

domainofgreenfieldinvestment.AsdeterminedbytheUnitedNationsConferenceonTradeand

Development,thefirmsleadinginboundgreenfieldinvestmentinJordanarealmostexclusively

operatinginthefieldsofluxurytourism(namely,hotels)andcommercialandresidentialreal

estate.Whileinflatingmarketsforspeculativenon-tradablesandlendingfurthervolatilitytothe

marketsofextractiveindustries,then,empiricallyspeaking,FDI’simpactonjobcreation632,

industrialupgrading,exportdiversification,andtechnologicaltransfershasproven

unsurprisinglynegligible.

*TableprovidedbyUnitedNations

ConferenceonTradeandDevelopment.

630 FormoredetailsonthisphenomenonacrosstheMiddleEast,seeHanieh(2016).631 DatadrawnfromTheFinancialTimes’FDIMarketsdatabase.632 Thevastmajorityoftheworkersemployedintheconstructionsectorarenon-Jordanian.Accordingly,the

buildingofrealestateprojects,etc.,doeslittlefordomesticjobcreation.

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BeforeclosingonFDIinparticular,itisalsoworthemphasizingthatsuchinflowshave

neverbeenofthemagnitudenecessarytomakeupfordeclinesinpublicinvestment(seetableon

nextpage)—declinesthathavebeenpartandparcelofGenerationAbdullah’sneoliberally-

orientedfiscalconsolidationinitiatives.Byconsequence,thestate’sFDI-dependentinvestment

strategyisalsoimplicatedinthedepreciationofthecontemporaryeconomy’scapitalstock.

MovingbeyondFDIandintoquestionsrelatedtoGulfcapital/Gulfinvestment’smore

generaleffectsontheJordanianeconomy,anumberofpointsareworthmaking.Regardingthe

magnitudeofGulfcapitalinJordan,ananalysisoftheAmmanStockExchangerevealsthatGulf

investorsnowcontrolroughly40%ofthetotalequityheldinJordan’spubliclytradedfirms.633

Disaggregatingthisdatafurther,oneseesthatthis40%isitselfcontrolledbyanexceedingly

smallgroupofindividuals.PertheSecuritiesDepositoryCenter,asofMarch2019,amere377

Qatariswereholding5.8%ofthetotalequityontheASE;3,000Kuwaitishelda5.7%aggregate

equityshare;134Bahrainishelda4.24%aggregateequityshare;andacomparativelynumerous

2,500Saudishelda6.2%aggregateequityshare.Inaddition,itisworthnotingthatthirty-three

“residents”oftheCaymanIslandshold3.9%ofthetotalequityvalue,afigureratherstarkly

suggestthemagnitudeofJordan’sinvolvementwiththekindsoftaxevasionrevealedbythe

PanamaPapersanddiscussedinchaptereight.

633 Non-Jordanianinvestorsmoregenerallyhavecontrolledbetween48%and51.7%ofthetotalequityintheASE.

See:https://www.ase.com.jo/en/Quotes-Market/Market-Performance/Foreign-Investment-Activityformoredetails

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Country Shareholders Securities Total Value (JD) Saudi Arabia 2503 387667360 987,253,927

Kuwait 2875 223358573 840,771,002 Qatar 383 183039961 786,706,464

Bahrain 129 339646400 658,390,147 Lebanon 1165 210388137 397,181,640

UAE 389 109725324 241,859,065

DataprovidedbySecuritiesDepositoryCenter;Figuresaccurateasof8/31/2019

TheseGulfinvestorsareheavilyleveragedwithintheJordanianbankingsector—more

specifically,withinthesector’slargestinstitutions,namelyArabBank,JordanKuwaitBank,the

HousingBankforTradeandFinance,AhliBank,BankofJordan,andCairoAmmanBank—,asthe

tablesonthefollowingpagesdetail.Allowingsuchactorstoimbueifnotsubsume/reconstitute

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Jordanianfinancialcapital’sfundamentalorientation,interests,andrelationalitytoregionaland

globalsystemsofproduction,distribution,andinvestment,theGulf’spositioninginthebanking

sectorisacentralmechanismwithinthelargerengineeringofJordan’sclass-biased,crisis-

orientedcapitalism.

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Thedevelopmental,political,andsocialrisksintroducedbytheGulf’scolonizationofthe

Jordanianeconomyareprofoundandmultifaceted.Oneneedbegin,ofcourse,withfundamental

mattersofsovereignty.ByvirtueofthehegemonicpositionsestablishedbyGulfinvestorswithin

thebankingsectorandothercriticalsectorsoftheeconomy634,theyhaveacquireddefactoveto

powerwithinthedevelopmentpolicymakingprocess.Withthespecteroftheircapitalflight

sufficienttothreatenatotalizingeconomiccollapse,thispowerallowssaidactorsto(tacitlyor

explicitly)disciplineJordanianofficialsandtherebyheminthealternativefuturesthoseofficials

mightotherwiseimagine.Asanypolicydesignneednowbeevaluatedaccordingtohowitmay

affecttheinterestsofforeigncapital,thislossofsovereigntymeansthat eventhosepolicymakers

whomightotherwisebeinclinedtobuckJordan’sneoliberaltrajectorieswillfindpreciouslittle

opportunityfordoingso.

Thenthereisthematterofwhat,precisely,constitutestheinterestsofGulfcapital.

Ultimately,thisisaclassofactorsacutelypredisposedtowardsinvestmentsinthebuilt

environmentandotherspeculativenon-tradables(includingfinancialassets).635Byconsequence,

theGulf’swideninghegemonyinJordannecessarilydeprivesthedomesticeconomyofthe

productiveandtechnologicallysophisticatedinvestmentsitneedstopowerlong-term

634 ForeigninvestmentsinJordannowconstituteroughly84%ofnationalGDP.635 Thereasonsforthelackoftechnologicaltransfersorknowledgeupgradesaremany.Tobegin,asHaniehhas

theorizedanddocumented,Gulfcapitalissuigenerisinthatitspreponderancehasnothingtodowiththeregion’sproximitytotheglobaltechnologicalfrontier.Wheresimilarlywealthycountrieshaveaccumulatedtheircapitalstockthroughproductiveactivitiesandinnovation(inaddition,ofcourse,totheextractionofresourcesfromtheglobalsouth),theGulfhasacquireditsalmostexclusivelythroughtheexportationofgasandoil.Thisbeingthecase,Gulfinvestorsofferlittleexpertiseandhavelittleexperiencewithmoresophisticatedindustries.Inaddition,aspetrodollarsderivedfromthesaleofoilandgastendtoberecycledintorealestateandfinancialmarkets—ratherthaninmarketsbasedinproductiveactivities—,thereceiptofGulfinvestmentalsocontributeslittletoacountry’sindustrialupgrading.

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developmentaswell.636WithGulfinflowsalmostexclusivelyparkedinfinancialassetsorinquick

hittingrealestateprojects—andwiththeseinflowscertaintotransferlittleinthewayof

knowledgeortechnology—,theirarrivalultimatelyadvanceslittlebeyondthevacationing

interestsofwealthyKhalijisheikhsandthegeopoliticalinterestsofreactionarydespots(inthe

caseoftheAqabaPort).

(6)BrainDrain+Remittances

Finally,nosurveyoftheexternalarticulationofJordan’sSSAwouldbecompletewithout

consideringitsmigratorydimensions.Aswaspreviouslydiscussed,Jordan’spositionwithinthe

migratorynetworksofarelativelyintegratedregionallabormarkethashistoricallyimplieda