David S. Landes, 1924-2013

David Saul Landes

David S. Landes, who died August 17 at the age of 89, was one of the most distinguished economic historians this country has produced; he taught at Harvard from 1964 until his retirement in 1997 as both Coolidge Professor of History and Professor of Economics. He may be best-known to the world at large as the author of The Wealth and Poverty of Nations, but to the Middle East Studies community, and particularly to those of us who are historians of Egypt, he will be remembered as the author of his only foray into our field, Bankers and Pashas: International Finance and Economic Imperialism in Egypt, a 1958 history of how European financiers and the Khedive Ismail's excesses steered Egypt towards economic dependency and ultimately British occupation, based on his discovery of a correspondence between a French banker and the Khedive's personal banker. Except for Bankers and Pashas, Landes had no real Middle East links other than a personal commitment to the State of Israel, but Bankers and Pashas remains an essential contribution to understanding 19th century Egypt and the origins of the colonial era.

Fayyad's Fall: Was the West Too Supportive?

The resignation over the weekend of Palestinian Authority Prime Minister Salam Fayyad came after weeks of political maneuvering and longstanding issues with President ‘Abbas,but the timing is nevertheless unfortunate given the US attempt to restart the peace process, embodied in President Obama's and Secretary of State John Kerry's recent visits to the region.

There's a wide range of commentary out there (links below), but one emerging theme seems to be this: Did the US (and Israel) actually undermine Fayyad's position by their enthusiastic support for his policies? Did this tend to lead to his being seen as "America's man" (and hence Israel's) in the Palestinian Authority?

Certainly from Fayyad's initial appointment in 2007 the US and the West generally have been enthusiastic in their support of Fayyad's economic policies, reform measures, efforts to build infrastructure and civil society, — and quite justifiably so, in my opinion. But as this perhaps laid on a bit too thick, allowing Fayyad's enemies to label him a Western (read: American) puppet or stooge? That seems to be a criticism being put forward by many of Fayyad's supporters.

For a wide range of English-language analysis and opinion on Fayyad's departure: The New York Times, The Washington Post, The Guardian, The Independent, The Telegraph, The National, Arab News, Haaretz (paywall),  972 Magazine.

The Life, and 222-Year Extended Afterlife, of the Maria Theresa Dollar

Maria Theresa as She Was

The Empress Maria-Theresa of Austria-Hungary (Kaiserin Maria-Theresia in German) was the only Empress in the Austrian Hapsburg dynasty as Holy Roman Empress and Archduchess of Austria; her 40 year reign (1740-1780) and 16 children guaranteed her a role in European royal genealogies and various 18th century wars.  But at least outside of the former Austria-Hungary, that is not how she is best known today. The standard silver coin of her reign, the Austrian thaler was considered a standard and stable unit of currency,and was coined throughout her reign. (The choice of "dollar" as the name of the currency of the new United States was certainly influenced by the reputation of the thaler.) Then she died in 1780. But her coinage did not.

As the Middle East Knows Her

As late as 2002, the Austrian mint struck a special production of coins with her image and the date 1780. They weren't counterfeit, and other mints across Europe had struck similar coins with the image of a long-dead Empress and the date 1780 during the 222 intervening years since her death, quite legally if the silver content was correct. Britain was the last to cease regular minting in the early 1960s. In Africa and the Middle East the Maria Theresa "Dollar" (riyal nimsawi or "Austrian riyal" in Gulf Arabic) was the standard "trade coinage" acceptable in the souqs of the whole region, the trusted silver coin. The long-dead Empress and her familiar buxom profile, the Hapsburg double eagle on the back, and the date of 1780 were more reliable than the coinage of local rulers, Ottoman Sultans, or colonial powers. The UK minted them since its Gulf dependencies long preferred them to Sterling. The British counterfeiting laws made counterfeiting Maria Theresa Thalers just as illegal as counterfeiting British sovereigns.

This 2003 article in Saudi Aramco World gives a good summary of the coin's career in the Gulf. An excerpt:

And wherever it was used, the coin was subjected to careful scrutiny. "Locals would count the number of pearls on Maria Theresa's oval brooch, or check the feathers on the imperial eagle. (These were the features that the names abu nuqta and abu reesh refer to.) Recipients would reject coins out of hand if they did not precisely match the original 1780 strike," explains Semple.

"Semple" is Clara Semple, whose book,  A Silver Legend: The Story of the Maria Theresa Thaler sounds fascinating,  though from its current Amazon listing appears to be unavailable, at least at my budget. A good review of the book in The Guardian, however, does open with a good story:

At Talh market in northern Yemen, I once watched an old man pay for a fresh clip of Kalashnikov ammunition with some weighty silver coins. Neither Yemeni or Saudi riyals, these reassuringly hefty discs were date-stamped 1780 and bore the image of a large busty woman on one side, an impressively feathery eagle on the other. They were silver dollars of the Austro-Hungarian empire and the woman was Maria Theresa, empress from 1740 to 1780.

Despite generous offers from the market-trader to sell me various machine guns, bazookas and even a tank ("only two days to deliver!"), I bought the money from him instead, paying a small premium to avoid some obvious forgeries. Little did I know that in some senses all the coins were forgeries, and a bright copy made in the sands of Talh the day before was at least as interesting as my supposed originals. Those, as Clara Semple points out in her intriguing book, could easily have been minted in Birmingham in the 1950s, or Brussels, London, Paris, Bombay, Rome or Vienna at some time in the previous two centuries - almost all had that 1780 date. As for rarity, around 400 million are known to have been issued in that period.

The review concludes:

These days the use as a trade currency is all but gone. Gold has replaced silver as the jewellery metal of choice and the American dollar as the currency. The generous bosom of Maria Theresa is only found in tourist bazaars and antique jewellery. To my intense pleasure, however, the last photograph in this delightful book is of that Yemeni market at al-Talh, a trader surrounded - just as I remember - with rifles, pistols and piles of Maria Theresa dollars. For a splendid moment I was back there, reliving my fantasy of becoming the first, and last, man to buy a T-64 Soviet tank with an 18th-century treasure trove.

 I'm not sure if he'd have been the first, and given the current situation in Yemen (the review is from 2006), I'm not sure no one has bought a T-64 with Maria Theresas by now. Silver is still silver.

There are earlier instances of currency strikes that continued long beyond the death of the monarch. One that may have endured even longer than Maria Theresa are the coins of Alexander the Great, though they were not copied with either the fidelity or the reliability of the content of their specie as the Maria Theresa. Bad copies of Alexander's  coins were still being circulated in Nabataea and Arabia (and even in Italy), areas he never even conquered, centuries after his death.

Why Iran's Economic Crisis is Not Necessarily Good News

In the wake of the devaluation of the Iranian riyal, agitation, Bazar strikes and demonstrations have been rocking Iran in recent days. You can find accounts here and here, the latter with video, and analysis here.

At The Guardian, Peter Beaumont warns against facile judgments that this shows that "sanctions are working," and that this is good news.

But what does "sanctions are working" actually mean? Some hawks have read it as the possible beginning of the end for Iran's nuclear programme and the collapse of the clerical regime. For others, including those anxious to avoid conflict over Iran, it has been seized on as a suggestion that the crisis might be resolved through negotiation and non-military pressure.

The reality is that the political, economic and social impact of sanctions can produce very different results from those allegedly desired, more often than not hurting ordinary people. And there is a third scenario, in which sanctions might actually make the confrontation with Iran more dangerous still.

 It's worth a read, and the final paragraph is indeed cause for reflection:

So to those celebrating Iranian pain, be careful what you wish for in desiring a crisis. It was hyperinflation under a regime of reparations that contributed to the collapse of the Weimar Republic. Few foresaw then what might occur. And few, now, are considering what a sanctions-triggered economic crisis might really mean for Iran and the region.

Some Hard Truths about Egypt's Economy

Economics may be the. "dismal science," and a lot less inspiring than political change, but the roots of Arab Spring were economic ones, aqnd the future of Egypt in particular will be closely bound up with how any new government, of whatever political coloration, addresses the country's profound economic problems. Jon Alterman at CSIS reminds us of these hard truths. A necessary read.

Finance Minister: Egypt's Economy Has Lost $3.5 Billion

The Egyptian Revolution and continuing labor unrest and strikes have cost Egypt's economy at least US $3.5 billion, according to Finance Minister Samir Radwan. Some $2.2 billion of that is in lost tourism revenues. In addition, foreign direct investment, originally estimated at $7 billion for the fiscal year ending in June, is now estimated at $3 to $4 billion.

Egypt's economic problems were ironically a main trigger of the protests, but during thr uncertaintes of the present transitional period, things may well  get worse before they get better.

Hunting for Housing?: A Bargain in Dubai if You Don't Mind Heights

We all know Dubai has been hit hard by the property values crash, so much so that the World's Tallest Building®, the Burj Khalifa (AKA the Burj Dubai before Abu Dhabi bought the naming rights), has a major fire sale going on because only 8% of the giant tower is occupied: the cheapest studios starting at 80,000 UAE dirhams annually. or some $21,780. I suppose that's not really that bad (though it's more than I pay in mortgage annually, but I'm not in the world's tallest building), and it's a 40% cut from the list.

Of course it's renting, and the article doesn't state the size of a studio, and I still can't afford it, but it almost is starting to sound affordable. Not to me, but it's not pricing itself out of the depressed Dubai property market I suspect. So what began as wretched excess has become affordable? But can it sustain itself? We'll see. Prices slashed! Unprecedented bargains! You can see Iran from your house!

Two Awkward Anniversaries

According to today's issue of The National, the Burj al-‘Arab hotel, a Dubai landmark (though the world's tallest building, now under construction, the Burj Dubai, literally dwarfs it), is celebrating its 10th anniversary today (and tomorrow is the UAE's National Day). Given Dubai's current financial crisis, the celebrations of both may be muted, at least in Dubai. (Is anything ever actually muted in Dubai, though?)

Why I haven't written more on Dubai: mostly because it hit over the holiday, but also because other people are doing a better job of this. Financial markets aren't my strength, so I again refer you to Suq al-Mal the blog, to the Gulf and international business papers, etc. Anything I say would be little more than repeating what I've read elsewhere. Obviously I hope they and the other Gulf economies can weather the crisis.

The Dubai Shock

It's Thanksgiving weekend. I'm busy. For the Dubai financial shock, Abu ‘Arqala over at Suq al-Mal is where you need to look. See you Monday unless something else goes crazy.

Weekend Reading

If the new readers are still around, perhaps I should explain that since I don't blog on weekends, I've taken to putting together a sort of catchall "weekend reading" list of reports, studies, or postings of interest in the field. It's pretty much whatever I'm aware of and isn't meant to be comprehensive.

And, a I noted in the previous post, according to my counter this will be the 400th post since starting in January. A full hundred of those appeared in June, thanks to the Lebanese and Iranian electons, the Obama speech in Cairo and the Iranian uprising.

• The Carnegie Endowment's Arab Reform Bulletin has a special issue on the world economic crisis and its impact, offering a somewhat different emphasis than its usual concentration on democratization issues.

• David Pollock at the Washington Institute for Near East Policy has sometimes criticized methods of polling in the Arab world, but today he's noting some new polls that show the US doing better in the "Arab street." [Oops. For several hours I had it spelled "Pollack." Sorry, Dave. Must have been thinking of Ken. Fixed now.]
  

• Sheikh Yusuf al-Qaradawi, the Qatar-based, Egyptian-born television preacher often criticized in the West but much watched in the Middle East, has a new book out; Marc Lynch considers it quite important; Arabic Media Shack is more cautious; Al-Masry al-Youm serialized parts of it for those who read Arabic.

• The latest podcast is up at MEI: A View of the Current Situation in the Swat Valley and Waziristan by Pakistani Minister for Parliamentary Affairs Dr Babar Awan. (Podcast plays when you click the link, so use earphones if you're in a busy office.) Original details of the July 6 event are here.