KUWAIT CITY, KUWAIT—Voting in Kuwait is a risk factor for obesity. Outside the polling places candidates offer food and drinks to prospective voters. Unfortunately, the outcome of the most recent legislative election wasn’t as sweet as the refreshments. The opposition won control of parliament with 34 of 50 seats. Islamists took an outright majority: 23 Sunni and four Shi’ite. Liberals won just nine seats.

Kuwait is one of the Gulf’s most open societies—not the most competitive of categories, it must be said. Women work, drive, and dress as they wish, despite some discrimination. The media is considered the region’s freest, though journalists are occasionally prosecuted, and the government has caused concern with its new plan to regulate social media.

Religious minorities face some difficulties, but three Christian churches sat within two blocks of my hotel. On an earlier trip the late Reverend Jerry Zandstra, who presided over an English-language evangelical congregation, told me: “We have never had any trouble with the government, where they’ve inhibited us or stopped us.” (Faiths not mentioned in the Koran, such as Hinduism, enjoy less liberty.)

Elections also are free. Undersecretary of Information Salman Sabah al-Salem al-Homoud al-Sabah touts Kuwait’s “long practice of democracy.” The 16-member cabinet is appointed by the Emir, but the elected National Assembly can block government initiatives, question officials, investigate abuses, and hold no-confidence votes on ministers. Indeed, the previous cabinet, headed by the Emir’s nephew, resigned after opposition attacks for alleged corruption.

Kuwait sits atop a pool of black gold. Oil provides roughly half of the nation’s GDP—the exact share varies depending on oil prices—and as much as 95 percent of the government’s revenue. According to the Kipco asset-management company, “Even in the non-oil economy … government activity (community, social and personal services) is a prime source of opportunities and the second largest contributor to GDP is government services.” The state controls about 70 percent of GDP and provides a bountiful welfare state. In Kuwait City’s better neighborhoods, beautiful homes sit with expensive cars lining the streets.

The country is filled with bright, engaging people. But there is little spirit of private enterprise, even though the economy is more open than those of its neighbors. By one estimate 90 percent of Kuwaitis work for the government. Why engage in the uncertain process of starting a business when safe employment and generous benefits are available just for living? Faisal Hamad al-Ayyar, vice chairman of Kipco, told the Financial Times, “The government takes care of you from birth to death; even the rubbing when you die is by the government.” There is hustle and bustle, but most often it comes from expatriates—who last year made up 83 percent of the workforce.

For years Kuwaitis have talked about diversifying the economy. Kuwait received just $800 million in foreign direct investment over the last decade, compared to $130 billion in Saudi Arabia, $73 billion in the United Arab Emirates, and $10 billion in Bahrain. “There’s a saying here: Kuwait is the past, Dubai the present and Qatar the future,” oil analyst Kamil al-Harami told the FT.

Parliament has blocked government attempts to open oilfields and refineries to international investment. Two years ago the government did receive authority from parliament to privatize public firms and undertake a development program to attract private investment, expand the private sector, and diversify away from oil. Yet not much has been achieved. In October the government delayed its plan to privatize the much-derided Kuwait Airways.

Sheikh Mohammad Abdullah al-Mubarak al-Sabah, a top official in the prime minister’s office who after the election was appointed Minister of Information, told me, “There is always a contest between philosophies. Normally the free market versus state control.” He said that Kuwait suffered from the influence of a strong “mercantile establishment,” the majority of whose members “want to be spoon fed with a state-sponsored welfare system and economy.”

Increasing dependence is the government’s first defense against social unrest. When tremors from the Arab Spring hit Kuwait last year, the government responded by giving an extra $3,600 and 18 months of free food staples to every Kuwaiti. But religious and tribal controversies still flare.

 

Before the election former oil minister Adel al-Sabeeh complained of an “unhealthy and highly charged” atmosphere in which “sectarian and tribal tensions are negatively impacting our country.” There was unusual violence—the burning of a candidate’s campaign tent and a mob attack on a television station. Prime Minister Sheikh Jaber Mubarak al-Hamad al-Sabah insisted, “We will not allow factionalism or tribalism or sectarianism to affect our national unity.”

Islamists have dominated parliament before, but today’s context is different. Dr. Ahmad al-Kateeb, a former MP who helped produce the constitution, expressed his apprehension to the Kuwaiti Times: “The regional conditions and sectarian tensions in some countries have helped Islamist movements to emerge, leaving some effect on [Kuwait’s] parliamentary elections.” Dr. Abdullah al-Shayji of Kuwait University similarly warned Bloomberg, “It’s beyond all expectations. We have extremism on all fronts, and it’s going to be very explosive.”

Still, it is important not to overplay the Islamist victory. Dr. Naser al-Sane, a former MP whose Islamist group saw four candidates elected, noted, “corruption was the hot issue of the campaign.” The Islamists took up the banner of reform.

Those elected are diverse. “Some of the Islamists are very moderate in thinking,” Dr. Shafeeq Ghabra of Kuwait University told me, pointing to Dr. al-Sane as an example. Moreover, they are deeply embedded in what remains a small society. When I met Dr. al-Sane at my hotel he was greeted warmly by people from across the political spectrum, including government ministers. He emphasized the Islamists’ willingness to work with other groups, including liberals. “Reform and development represent our agenda,” he said.

Yet the Islamist bloc was quick to propose amending the Kuwaiti constitution to make Sharia Law “the” rather than just “a” source of legislation. The proposal seems unlikely to get the necessary two-thirds parliamentary vote, but Islamist MPs may push a legislative equivalent.

Some MPs have proposed banning bikinis and requiring women to wear headscarves. Such rules could require the creation of Saudi-style religious police. Rola Dashti, one of four female MPs defeated in February, was quoted in the Financial Times saying that the Islamists will attempt to push women out of public life and that the cabinet will “trade social liberty and women’s rights for the sake of ‘cooperation’.” Other observers downplay the threat.

In May the National Assembly overwhelmingly passed legislation imposing the death penalty for blasphemy, which until now has been punished by imprisonment and a fine. The government indicated that it would not block the measure. The new punishment would only apply to Muslims, but some MPs sought to cover non-Muslims as well. This will move Kuwait uncomfortably close to Pakistan.

After taking office the newly formed al-Adala, or Justice, parliamentary bloc proposed prohibiting the construction of any new churches or other non-Muslim centers of worship. The Salafist MP who drafted the measure initially wanted to outlaw existing facilities as well. The legislation was tabled in March. The Kuwaiti Minister of Religious Endowments warned that the measure would violate “the state’s laws and regulations” which protect religious freedom.

The government has little choice but to work with the National Assembly. Within the country the biggest issue is political reform, which even the Emir’s government supports. “More freedom, more democracy is the right way,” said Undersecretary al-Homoud al-Sabah. Sheikh al-Mubarak al-Sabah similarly argued, “There need to be changes in the constitution to make it more democratic and to keep up with the pace of change.” Most fundamental are proposals to establish a constitutional monarchy and a true parliamentary system.

Calls for radical change remain muted, but there are signs of impatience. An independent MP, Salem al-Namlan, predicted, “There will be major confrontations between the government and MPs.” The National Assembly chose as speaker a long-time opposition leader who has sought to restrict royal power. Last November, opposition MPs led demonstrators in storming the parliament building to demand the prime minister’s resignation.

The Arab Spring serves as a dramatic backdrop. “History is being put in a pressure cooker,” with people expecting results much more quickly, Dr. Ghabra observed.

 

Yet the most serious challenges to Kuwait remain external. The 3.6 million Kuwaitis, barely a third of whom are citizens, live in a bad neighborhood. Noted Alanoud al-Sharekh of the International Institute for Strategic Studies: “We are well aware of the dangers of antagonizing our more populous and militarily powerful neighbors.”

Kuwaitis are mindful that absent American intervention their nation would be the 19th province of Iraq. The scars of that war remain. “It took a lot to overcome the shock when we lost our country,” said Sheikh al-Mubarak al-Sabah. But much of Kuwait’s young population does not remember the invasion. Thus Undersecretary al-Homoud al-Sabah told me, “We need to make some efforts to teach our new generations about the sacrifices of the American people.”

The U.S. presence offers security but creates another kind of dependency. The Kuwaiti army numbers just 11,000; the country has 11 naval vessels and 66 combat aircraft. The U.S. does not seem likely to soon withdraw from the Persian Gulf. Sulaiman Majed al-Shaheen, who has held top foreign ministry and other government posts, told me, “Every new administration has new views, but the commitment of America in the Gulf is there.”

Yet growing financial pressures on Washington could force unexpected changes. Moreover, there are some tensions with America. Kuwaitis uniformly oppose U.S. policy towards Israel and the Palestinians. Indeed, the government has aided Hamas in Gaza. Dr. al-Sane argued that it isn’t “enough for the U.S. to be driven by a single side of the Israel-Palestinian conflict.” Kuwaitis have also demonstrated against the detention of Kuwaiti prisoners in Guantanamo Bay.

An expanding American military presence could create further problems. The relationship is governed by a renewable (and classified) security agreement. Troop numbers have come down with no more forces in Iraq to support, but apparently 15,000 personnel remain, including an army combat brigade shifted from Iraq and called a “mobile response force” by its commander. While this troop presence might help deter an attack on Kuwait, it also has an offensive purpose. Washington’s use of Kuwait to launch operations against Iran or another nation would invite retaliation against Kuwait.

Kuwait’s most immediate concern is Tehran. Undersecretary al-Homoud al-Sabah emphasized that “we intend to have peaceful relations with Iran.” Yet the relationship remains characterized by “anxiety and uncertainty,” Sheikh al-Mubarak al-Sabah admitted.

Only in January did Kuwait announce that the two countries would reinstate their ambassadors, who had been withdrawn after last year’s discovery of an Iranian spy ring in Kuwait. Sheikh al-Mubarak al-Sabah complained, “Iran plays a subversive role in Kuwaiti politics.” Indeed, Iran is sharpening the Sunni-Shia divide, which he calls a “riptide.” Kuwait’s Sunni monarchy has faced little challenge from the relatively large (40 percent) Shia minority, but Kuwaitis look nervously at Bahrain, where Sunni royalty backed by Saudi Arabia is at war with the majority Shia population. “When the sectarian trend rises, it rises here,” according to Sheikh al-Mubarak al-Sabah.

Iran’s nuclear activities—and Washington’s hawkish stance toward them—remain a grave concern. Observed Kristian Coates Ulrichsen of the London School of Economics: “I think the Kuwait government is coming under pressure to take a much harder line than it would like.”

No one believes the Iranian leadership plans a suicidal jihad, but a nuclear capability would reinforce Tehran’s ability to overawe the region. “We support their use of nuclear energy,” said Sheikh al-Mubarak al-Sabah, but he insisted that the program comply with international safeguards. “Even with their assurance to the international community that they are using their nuclear program for civilian use, we have doubts,” admitted Undersecretary al-Homoud al-Sabah.

There appears to be little fear of direct Iranian aggression. Retired ambassador Abdullah Bishara dismissed the rhetoric emanating from Tehran. “There is a line Iran won’t cross. They won’t do anything to hurt themselves.” Military action by Iran “would be national suicide.” Iran is “surrounded by nuclear powers. None are friendly. So Iran wants nuclear weapons for protection.” Similarly, Dr. Ghabra opined, “I can understand why Iran, though a major power, is insecure.”

Certainly Kuwait prefers that no war be fought in its neighborhood. The government says that it will not allow military operations from its territory against Iran, which the latter warns would result in retaliation. Dr. Ghabra is concerned that “if you attack Iran, the regime will mobilize. People will not change the regime for the U.S.” According to Dr. al-Sane, “Military action would be very bad for us. We would suffer a lot.” Analysts disagree over Tehran’s ability to close the Strait of Hormuz, but a combination of missiles, mines, and small attack vessels could inhibit oil traffic and raise insurance rates. Tehran attacked Kuwaiti oil tankers once before during the lengthy Iran-Iraq War.

 

Iraq also is a problem, even though Saddam Hussein is long dead. “No one trusts Iraq,” admitted Sheikh al-Mubarak al-Sabah. In fact, four years ago Kuwait’s defense minister indicated his concern over U.S. weapons sales to Iraq’s new government: “In the short term, there is no danger for Kuwait, but in the long term, there could be some fears form these arms sales.”

There are obvious reasons for caution. “The instability in Iraq, the internal politics are not very encouraging,” allowed Undersecretary al-Homoud al-Sabah. Dr. Ghabra further noted that there “is a big vacuum in Iraq. Iran is trying to fill the vacuum.”

But the problem is more fundamental. Iraqis appear to covet territory, Gulf access, and wealth, which they see as denied to them by Kuwait’s existence. “When there are problems there they find a way to export it to their neighbors. And their weakest neighbor is Kuwait,” explained al-Shaheen.

Even democratic Iraq long refused to respect a 1993 United Nations resolution setting the boundary between the two nations. In March Iraq finally accepted the UN-designated border.

Other issues aggravate relations. Iraq was forced to pay reparations after its invasion of Kuwait and still owes $25 billion, for which 5 percent of all oil revenues are deducted through a UN-supervised process. Iraqis are asking for relief, and some observers wonder if Kuwait risks being penny-wise but pound-foolish, recalling the reparations demands of the allies after World War I. Indeed, Kuwait’s attempt to seize an Iraqi Airways airplane on its first flight to London to enforce a separate $1.2 billion claim by Kuwait Airways had the look of comic opera. KA’s case was also settled in March.

Controversy surrounds Kuwait’s plan to build a new port at Mubarak al-Kabeer, a few miles from Iraq’s planned Grand al-Faw port. Mubarak al-Kabeer would also compete with Iraq’s established al-Basra and Umm Qasr ports. Iraqi Prime Minister Nouri al-Maliki formed an Emergency Committee last spring to address the issue. Some Iraqis improbably charge that Kuwait intends to damage their nation, and they advocate various forms of retaliation. Last fall the Iraqi foreign minister said the dispute had been resolved, but it hasn’t. In April, Iraqi parliamentarians were pressing their government to pursue the matter.

Kuwait has a legal right to proceed but has raised the possibility of third-party arbitration. “We have to maintain efforts to preserve good relations,” said Undersecretary al-Homoud al-Sabah. Some adjustment might make sense for political reasons: “Kuwait is the country that will feel the heat if something happens. So it’s best not to follow the Saudi line: it’s better to have an open relationship with Iraq,” Kuwait University’s Ghanim al-Najjar observed.

Relations appear to be improving. Prime Minister Maliki visited Kuwait in March. Two weeks later Kuwait’s Emir attended the Arab Summit in Baghdad, making the first visit by Kuwait’s head of state since Hussein’s invasion.

 

Kuwait is a friendly, hospitable, and relatively free society that exhibits genuine gratitude toward Americans. “Thank you very much for the American people supporting Kuwait,” said Undersecretary al-Homoud al-Sabah. Sheikh al-Mubarak al-Sabah told me, “It makes a lot of difference to us that the Americans are here.” He may be right in claiming, “there has been no truer friend to the U.S. in the last 20 years than Kuwait.”

Yet even Kuwait is not immune from larger social forces sweeping the Arab world, which demonstrates the problem of Washington picking up security dependents almost by happenstance. Before 1990, few Americans thought Kuwait was important. Some analysts argued against intervening to stop Saddam Hussein’s invasion since it didn’t matter who controlled Kuwait’s oil as long as it remained on the market.

After restoring Kuwait without defanging Iraq, the U.S. couldn’t easily return home. Temporary assistance turned into a permanent guarantee. Today Washington hopes to use Kuwait as a base for watching both Iraq and Iran, and perhaps much more. This will discourage Kuwait from improving its own defense, while keeping America entangled in Gulf disputes. And if Kuwaitis’ pro-American attitudes start to recede, the relationship could crash.

That’s something Americans and Kuwaitis alike should ponder. A couple of years ago the U.S.-Egypt relationship looked solid. Then came a popular challenge during which U.S. policy veered between amateurish and disastrous; no one knows what relationship finally awaits the former allies. Kuwait is a far better friend and much freer society than Egypt. But how long will it remain that way?

Doug Bandow is a senior fellow at the Cato Institute and the author of Foreign Follies: America’s New Global Empire.