(John Kemp is a Reuters market analyst. The views expressed are his own)
By John Kemp
LONDON, Nov 6 (Reuters) - The wave of arrests and ministerial changes in Saudi Arabia at the weekend has fundamentally transformed the structure of the state as it has existed since the 1960s.
Saudi Arabia has practised a form of collective leadership since the death of the founder King Abdulazziz in 1953 and especially since the abdication of his son King Saud in 1964.
The crown has descended among the younger sons of Abdulazziz, with each son and his family tending to control one element of the state.
Prince Faisal and then his son controlled the foreign ministry for decades. Prince Sultan controlled the defence ministry; Prince Nayef, the interior ministry and security forces.
Prince Abdullah controlled the National Guard, a well-armed militia recruited from the royal family’s traditional tribal supporters. And Prince Salman served as governor of Riyadh.
The system was intended to avoid the concentration of too much power in any one branch of the family and give all the sons of the founding king a stake in it.
While formal power has always resided with the monarch, in practice the king was expected to consult with other senior members of the royal family and rule by consensus.
The Saudi system of government has been more prime-ministerial than presidential.
In fact, the king has always been concurrently the prime minister, while the crown prince has served as deputy prime minister, and other senior princes have served as ministers in a formal cabinet.
But the system has been fundamentally altered in a number of important ways since the death of King Abdullah and the accession of King Salman in 2015.
King Abdullah was predeceased by both his intended successors, Prince Sultan and Prince Nayef, so the crown passed to Prince Salman.
Prince Muqrin, an even younger son of King Abdulazziz, was designated as crown prince and heir apparent, but had little institutional power or influence within the royal family.
Muqrin was replaced a few months later by Mohammed bin Nayef, one of the sons of Prince Nayef, who had inherited control of the interior ministry and the security forces from his late father.
In turn, Mohammed bin Nayef was replaced as crown prince by the king’s own son, Mohammed bin Salman, in 2017.
Mohammed bin Salman had already become defence minister, thereby ending the control that Sultan’s family had previously exercised over the armed forces.
With the removal of Mohammed bin Nayef as crown prince and interior minister, the Nayef family’s control of the interior ministry was also effectively ended.
The last remaining “power ministry” was the National Guard, where control had been inherited by King Abdullah’s son Prince Miteb.
So the decision this weekend to remove Prince Miteb has eliminated the last remaining independent power base within the royal family.
For the first time, all three power ministries (defence, interior and National Guard) are under the direct control of one branch of the royal family.
Personnel changes for lower-ranked cabinet positions, sub-cabinet posts and provincial governors over the last three years have all removed independent power brokers and reinforced the concentration of power.
Control over all elements of the state has steadily consolidated power in the hands of King Salman and Crown Prince Mohammed bin Salman.
Saudi Arabia’s internal power dynamics are also changing in other important ways.
The cardinal rule has always been that disputes are settled quietly within the royal family, without the involvement of outsiders.
Princes were expected to show loyalty to the king and avoid overt calls for change in the system. In exchange, their personal security and wealth were respected.
Ostentatious displays of wealth have been discouraged and occasionally censured, but for the most part, princes have been free to accumulate money and business interests.
But in a fundamental breach with past practice, King Salman and his son have launched an anti-corruption campaign and arrested ministers and officials suspected of taking bribes and embezzlement.
The progressive removal of senior princes from government over the last three years, and now the wave of arrests of princes and ministers, is jeopardising the safety and wealth of royal family members for the first time.
Corruption has been rife in Saudi Arabia for decades and has drained fabulous amounts of wealth from the state into private hands, with much of it ending up abroad.
But corruption exists as part of a vast patronage system which ties together the royal family, the state bureaucracy and large parts of society in patron-client networks.
The anti-corruption campaign and decision to arrest senior ministers and even princes is therefore targeting the very structure of the Saudi state.
Whether this is a good thing depends on your view. Power-sharing and clientelism have underpinned the stability of the Saudi state but are also blamed for its inability to change and adapt.
Saudi Arabia’s high birth-rate and declining infant mortality have seen a surge in the population over the last four decades with the result that the majority of the population is under 30 years old.
The biggest social and economic challenge for the kingdom is finding enough well-paid jobs for the hundreds of thousands of young Saudis entering the workforce each year.
Unemployment and under-employment are widespread, as is frustration with the fierce system of social and religious controls introduced after the siege at the Grand Mosque in Mecca by Islamist militants in 1979.
As part of his bid to consolidate power, Crown Prince Mohammed bin Salman has explicitly courted support from younger Saudis with promises of social liberalisation, jobs and faster change.
The anti-corruption campaign is likely to be very popular with younger Saudis frustrated by stagnating economic opportunities, but it threatens much of the country’s business, political and social establishment.
In any political system, anti-corruption campaigns are a powerful way to bid for popular support to settle intra-elite battles.
In ancient Rome, rulers used corruption charges to eliminate enemies. England’s King Henry VIII used corruption charges against his powerful minister Cardinal Wolsey and the monasteries.
China’s President Xi Jinping has successfully used anti-corruption to reshape China’s Communist Party. And U.S. President Donald Trump is trying his own version with promises to “drain the swamp”.
The concentration of so much power in Saudi Arabia in one branch of the royal family introduces a new dynamic to the country’s government and heightens risk, though it also makes bold reforms more likely.
Recent events have sidelined other branches of the family and for the first time threatened their security, so the crown prince has made many enemies, though he may also have reduced their power to challenge him.
Collective leadership has been replaced by a much more personal form of rule, which also means that the crown prince will be held personally accountable for the government’s performance.
If the crown prince’s economic and social transformation plan was to falter or fail, his control is now at greater risk. The Saudi state therefore needs a swift return to economic growth and job creation.
In terms of oil policy, the Saudi state can ill-afford another decline in prices, decline in oil revenues and resumption of austerity.
The Saudi state’s existing preference for $70 oil (even at the risk of reviving U.S. shale production) rather than $50 oil (and risk a return to austerity) will become more pronounced.
Given the delicate political and economic context, Saudi Arabia will prefer to risk tightening the oil market too much rather than too little. (Editing by Dale Hudson)