On Sept. 11, 2001, at least 19 men – 15 of them Saudi citizens – boarded several commercial flights in Boston and Newark and set off what was to become the largest terrorist attack ever on U.S. soil. That event precipitated a major war in the Middle East, a war that continues today, and it signaled a new age in American foreign policy in which the U.S. is increasingly focused on deterring state sponsors of global Islamic terrorism.
Evidence pointing to Saudi financial support of the Sept. 11 attacks has become clearer, as plaintiffs in several federal cases seeking compensation have revealed in discovery documents. It is clear that the attackers had major financial and organizational support for their U.S. operations, support that could not have been possible without Saudi citizens' ability to conduct themselves and their business on U.S. soil without special scrutiny. There is also evidence that lower-level Saudi government officials, acting on the auspices of the Saudi ministry of Islamic Affairs within the Saudi Arabia's U.S. diplomatic corps, provided "charitable" contributions to individuals who later carried out the 9/11 attacks. Whether the Saudi government itself was responsible for the attacks, or whether elements within the Saudi regime were key enablers of the attacks, it makes little difference in practice. It is indisputable that U.S.-Saudi relationship provided cover for elements within the country to penetrate and attack innocent Americans on U.S. soil.
With President Obama's visit to Saudi Arabia this week, U.S.-Saudi relations are at an all-time low. A bipartisan coalition within the U.S. Congress has pressed the government to release documents related to the official 9/11 report that have not been publicly shared. It is alleged that some of those documents, in a so-called "28-page report," detail Saudi Arabia's awareness, involvement and/or complicity in the attacks. These document should be immediately released to the public and should form part of the basis for a determination of whether the Saudi regime's U.S. assets can be used to satisfy civil judgments arising out of the 9/11 litigation.
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Notably, the Saudi regime itself has pushed for the release of the document, claiming that its actions with regards to its relationship with the U.S. are beyond reproach and should be open to inspection. Furthermore, unlike other nations deemed state-sponsors of terrorism, such as Cuba and Iran, Saudi Arabia has vigorously defended itself in lawsuits alleging complicity in terrorism. Their lawyers have consistently argued that it is not in Saudi Arabia's interests to attack America, citing a decades' long relationship of mutual support between the two nations that contradicts the assertion. As further proof, they allege, the government of Saudi Arabia keeps close to a trillion dollars of its sovereign wealth in U.S. assets. Why would it want to harm those interests by attacking America?
And that brings us to perhaps the most contentious recent development in the U.S.-Saudi relationship. Plaintiffs in several class action suits in U.S. federal courts have sought to prove that Saudi Arabia contributed "material support" to the 9/11 hijackers and should therefore be financially liable for the damage caused. However, both U.S. and international law closely adhere to the concept of "Sovereign Immunity" – which holds that the U.S. assets of foreign governments are immune to liability in foreign courts. Over the years, several notable exceptions have been carved out of this framework – notably in cases of countries designated under U.S. law as state sponsors of terror. Unlike Iran or Cuba, Saudi Arabia is not designated as a state sponsor of terror and does not currently fall under the exception to sovereign immunity. Saudis have consistently and successfully argued this very fact in U.S. federal courts.
A revived attempt at enacting laws that would in essence pierce the shield of sovereign immunity for countries found to have provided material support for acts of terrorism that occurred on U.S. soil is making its way through Congress. The bill, formally named the Justice Against Sponsors of Terrorism Act (JASTA), would also apply retroactively to injuries arising out of the events of Sept. 11, 2001. While the bill has gathered widespread bipartisan support, including support from both Democratic presidential candidates, the Obama administration has consistently indicated that the president would veto the bill if it came across his desk in current form. The administration's rationale is that piercing sovereign immunity – even in this limited exception – would expose U.S. assets abroad to attachment in foreign courts, a prospect that could have wide-ranging and deeply troubling implications. But politically, JASTA has proven to be one of the few bright spots of bipartisan collaboration that has emerged from Congress in a decade. The notion of collecting damages from Saudi Arabia resonates deeply with the survivors of the terrorist attacks.
Saudi Arabia has reportedly indicated to members of the administration that should JASTA become law, it would immediately liquidate and repatriate its U.S. assets. This singular act would constitute a major break in the U.S.-Saudi alliance, and it cannot be an unexpected consequence of JASTA's passage. Saudi Arabia's position is that even if it were ultimately cleared of involvement in the attacks, its assets could be frozen indefinitely by U.S. courts pending the outcomes of the cases. The illiquidity risk would reduce the value of its investments significantly, causing it to rethink the idea of investing in the United States.
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No one doubts that such a divestment under fire-sale conditions could potentially cause global economic turmoil, although the U.S. could ultimately withstand such a temporary shock. What isn't so clear is whether Saudi Arabia could withstand U.S.-pullback in its military and defense commitments to the region – especially given the recent instability involving ISIS, Iran, the failing regimes in Yemen, Syria and Libya. All of these pose potentially existential threats to the Saudi regime. The time may have come for Saudi Arabia to play ball on our terms. This will require it to clean house – addressing the issue of financial support for Islamic extremism within Saudi Arabia and to contribute its fair share for the shared security arrangement in the region.
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