TIME: Almanac 1995

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<text id=90TT3428> <link 91TT0541> <link 91TT0538> <link 91TT0271> <title> Dec. 24, 1990: Toward A New Kuwait </title> <history> TIME--The Weekly Newsmagazine--1990 Dec. 24, 1990 What Is Kuwait? </history> <article> <source>Time Magazine</source> <hdr> WORLD, Page 26 COVER STORIES Toward A New Kuwait </hdr> <body> By MICHAEL KRAMER/TAIF Most people know only one thing about Kuwait: that George Bush has pledged to free it. Nevertheless, a pernicious notion has taken hold. Kuwait, it is alleged, was an arrogant, undemocratic handkerchief of a country no one would care about were it not for the oil beneath its sands. Is that view accurate? And if so, could the nation change after its liberation? Kuwaitis themselves have a vested interest in the answers to those questions--but so does the rest of the world, and particularly the half-million allied troops massed for war in the gulf. For now that Saddam Hussein has released his foreign hostages, the question has become simpler: Is Kuwait worth dying for? When he thinks about it at all, which he tries hard not to do, Ali Basa can remember in detail exactly when his luck ran out. It was shortly after 1 p.m. on Tuesday, Aug. 28, at a point in the Kuwaiti desert about 14 miles north of the Saudi border. On eight previous smuggling runs, the midday heat had protected Basa's overland enterprise. The Iraqis, everyone knew, were creatures of habit who invariably shunned the harsh sun. But not on this day. The cloud of dust that moved furiously toward Basa's three-vehicle convoy telegraphed the worst news possible. An Iraqi patrol--two armed jeeps--was converging on Basa's position. As planned in advance, Basa quickly shifted his Nissan out of four-wheel drive. In a moment, he was stuck in the loose sand. In another, he was in custody. But Basa's confederates got away, their Chevy Blazers roaring off for Kuwait City. By nightfall they would resupply the Kuwaiti resistance with 90 AK-47 assault rifles, 17 rocket-propelled grenade launchers, 5,000 rounds of ammunition and, at $25,000 each, three more mobile telephones equipped with portable satellite dishes--high-tech communications systems capable of connecting those "inside" with the outside world. To close friends familiar with Basa's activities, his daring had earned him a nickname. He was the "Hero of the Crossing," the same admiring sobriquet awarded Anwar Sadat after the Egyptian army crossed the Suez Canal during the 1973 October War with Israel. Now, at 40, with a wife and nine children safely out of Kuwait, Basa was headed for jail with phony papers identifying him as a citizen of Qatar. "That's what saved me," says Basa, recalling the story he had carefully rehearsed against the possibility of capture. "I told the Iraqis that I was just another expatriate who had worked in Kuwait. I told them that my mother-in-law was a Kuwaiti, that she was ill, and that I wanted to bring her out for medical treatment at `home' in Qatar. There was nothing to say otherwise. I had nothing on me, and the truck was empty. I was the decoy, and no one could prove it." But many tried. It would be 10 days, three beatings and more than a dozen interrogations before Basa's elaborate lie finally stuck; 10 days of hell before he was released by being tossed from a moving car near one of the new statues of Saddam Hussein in the middle of Kuwait City. During his detention at an Iraqi checkpoint, Basa shared a cell with three other Kuwaitis. Two of the three were tortured while Basa was forced to watch. "They wanted names, resistance leaders, people they could go after," he says. "One fellow had his genitals prodded with an electric rod. After that he was made to sit on a broken Pepsi bottle. Then, working very slowly, they ripped the fingernails off his right hand. He broke, of course. Who wouldn't? He gave them some names. And then they killed him. A single shot between the eyes." Of greater importance than anything Basa and a score of others smuggled into Kuwait was the wealth of data they smuggled out. Within a day of the Iraqi invasion on Aug. 2, the Kuwaiti government, already operating in Saudi Arabia, had compiled an intriguing shopping list--computerized information desperately needed for the country's business to continue despite the nation's physical occupation. "We are not called Kuwait Inc. for nothing," says Basa, who ran a small construction company before August and is now living with his family in Cairo. "Before we are a nation, we are a business. The nationality records we recovered can tell us who was a real resident of Kuwait and who was not, and that is obviously important. But the real lode was the nation's financial and banking records." All told, about 85% of that material was smuggled out, and the rest was reconstructed by late October. So Kuwait, or at least Kuwait Inc., is offshore now--an economy in exile. To many, Kuwait Inc. is a term of derision. To Kuwaitis, the staggering fortune their nation has accumulated, and particularly the way it has been invested and saved, is a matter of pride. With 94.5 billion bbl. of oil in the ground, enough for more than a century of production, Kuwait boasts the world's third largest proven petroleum reserves. But unlike other nations, which spend their oil revenues almost as fast as they come in, Kuwait long ago decided to save for the future. So successful has the effort been that for some years before Saddam's perfidy, Kuwait was reaping more yearly income from its overseas investments than from the sale and marketing of its crude oil and refined products. Kuwait's foreign-asset portfolio approaches a monumental $100 billion, which is invested in a bewildering array of stocks, bonds and entire companies around the world. Almost 70% of the total has been segregated for use when the wells run dry. The Fund for Future Generations, as it is called, is a model of enlightened policy and smart politics. "Other rulers in other places have kept the money for themselves and their friends, doling out just enough to keep their populations contained during their reigns," says Jasem Mohammed al-Hussein, a wealthy Kuwaiti businessman. "Our rulers, the Sabahs, have earned our loyalty by providing for our grandchildren. That foresight, I am sure, is one of the reasons why Saddam has failed to find a Kuwaiti quisling to govern Kuwait in his name." While Kuwait's investments bring in about $20 million a day, the economy-in-exile is driven by another engine as well, the Kuwait Petroleum Corp., the world's 12th largest oil company. From its London office on New Bond Street, KPC and its subsidiaries own and operate a fleet of tankers, oil and gas exploration companies in 22 countries on five continents, and 6,500 Q8 gas stations situated throughout Europe. Millions have been allocated to support Kuwaitis stranded abroad. In Britain more than 6,000 Kuwaiti nationals enjoy monthly stipends for housing and food, supplements that average more than $3,000 for a family of four. Far larger sums have been pledged to the U.S. for Operation Desert Shield and to nations like Turkey and Egypt that are suffering collaterally from the economic embargo of Iraq: a total of $5 billion in the last five months of 1990 alone. Kuwait could be expected to support those who may yet fight for its liberation, as well as to help those innocently hurt by the sanctions designed to compel Saddam's surrender. What is truly impressive, however, is the continuation of Kuwait's generous foreign-assistance programs. Over two decades, that aid has exceeded $17 billion--an average 6% of GNP yearly, a percentage many times as great as that of any other nation over a comparable period. Kuwait's humanitarianism is both real and self-serving. Genuine sympathy for the less fortunate reflects fresh memory: Kuwait was among the poorest of nations before the oil started flowing in 1946. But because envy is second only to petroleum as the Middle East's leading product, common sense dictates that a small and relatively defenseless nation seek goodwill however it can. "Better to share some of the wealth than have those who are strong but poor want to come and take it," says a Kuwaiti foreign-aid official. Recalling that Iraq was a longtime beneficiary of his nation's financial assistance, a Kuwaiti diplomat admits that "our `buy them off' strategy can be seen to have failed." On the other hand, he adds, "we interpret the willingness of so many Arab states to join the coalition against Saddam as a kind of payback to us for so many years of our helping them. In any event, we are committed to continue as we have. It is both right and necessary that we do so. We will always be weak militarily, and Saddam isn't the only despot around." While the policy of Kuwait's exiled economy is executed in London, it is determined in Taif, a Saudi town set atop a mountain about 40 miles southeast of Mecca. The Saudis chose Taif for the Kuwaitis because it is relatively inaccessible. The main road leading to the mountaintop culminates in a switchback that a platoon could defend against a division of aggressors. Together with his ministers and top staff, Kuwait's Emir, Sheik Jaber al-Ahmad al-Sabah, 64, lives and works out of the Sheraton Hotel near Taif. Modern and antiseptic, the hotel is instantly familiar to frequent travelers. Three corridors project as spokes from a central atrium that rises seven stories. The top-floor restaurant is open to all regardless of rank, but the ministers eat together at three tables set to the side, well out of earshot of the aides who serve them. Ministries that once occupied whole buildings in Kuwait function out of single rooms. One can find the Finance Ministry, for example, in Room 311. Surrounded by six chairs, two card tables in the middle of the room offer all the flat work space available. Several phones and a single fax machine connect the ministry with the rest of the world. There are two currency counters and enough calculators to ensure that Kuwait Inc. functions to the proper decimal points. A shredder sits near a large safe, opposite a small television set. But CNN, which everyone is eager to watch, is available only on another TV, two floors up--a Saudi concession, since the kingdom prohibits the public reception of CNN everywhere else. Without a country to govern, many in Taif have little to do but worry. They dial around the world in search of news, play countless rounds of hand, the 14-card Kuwaiti version of gin rummy, and recall receiving Iraqi television transmissions at home in Kuwait. "Saddam was on all the time," says a Kuwaiti minister. "On any given day you could see him instructing women on how to make tomato paste, or children on how to brush their teeth. It was some of the best comedy around." Not everyone in Taif is idle, of course. With critical chores to perform, the Finance Ministry, for one, churns almost around the clock. The Finance Minister, Sheik Ali al-Khalifa al-Sabah, 45, known to all as Abu Khalifa--and to a few close friends as Ali Cash--is highly regarded among both Kuwaitis and foreigners. "He can sell you the shirt off your back while you're wearing it," says a friend, affectionately. "He is absolutely one of the smartest, shrewdest people I have ever met." Although born into the ruling Sabah family, which now numbers about 1,000 extended relatives, Khalifa worked his way up through various jobs in the Finance and Oil ministries. Over the past 12 years he has held each of those crucial Cabinet portfolios several times, and was once minister of both simultaneously. Until he was 12, Khalifa attended elementary school in Baghdad, where his Iraqi-born mother went to live after her husband died. Khalifa learned English at a private academy in Cairo, and like every Kuwaiti who wanted a college education before Kuwait University was inaugurated in 1966, went abroad to study. Before being graduated with a B.A. in mathematics from San Francisco State University, Khalifa spent two years at Berkeley, where his chemistry lab partner was Mario Savio, the radical student leader who founded the Free Speech Movement. "We studied a bit, attended anti-Vietnam demonstrations and listened to Joan Baez, who was always around singing." Pegged a comer early on, Khalifa worked for the Finance Ministry between graduate studies in London and Beirut, often jetting home weekly for meetings. Before he was 30, Khalifa was representing Kuwait at important OPEC meetings. "I remember once when I went to Baghdad to explain our views on oil prices," says Khalifa. "After I finished my presentation, I was called to another building to see Saddam. Before I could go through it all again, Saddam said, `Khalifa, your explanation is not valid.' There had been no time for anyone at the earlier meeting to have briefed him, but Saddam knew exactly what I had said. Even then he had everything bugged." It was Khalifa who designed many of Kuwait's successful investment strategies, and Khalifa who reorganized Kuwait's oil industry following the government's 1975 takeover of the Kuwait Oil Co.--a joint venture of Gulf Oil Corp. and British Petroleum. And now, to no one's surprise, it is Khalifa who is at the center of his country's most ambitious effort: the attempt to reinvent Kuwait. If implemented in its entirety, the intricate and politically tricky plan could transform the demography, character and economy of what everyone involved is calling New Kuwait. A mere generation ago, the people of the Arabian shore of the Persian Gulf led a life little different from the one their ancestors had led since the advent of Islam. During migrations in search of water and trading locations, mainly from the Najd region of what is today the central part of Saudi Arabia, a group of tribes called the Bani Utub settled the town of Kuwait (in simple translation, Little Fort) in the early 1700s. With trade the major source of income, the tribes established a unique political system. Of the three most influential families, the Khalifas and the Jalahimas concerned themselves with commerce; the third, the Sabahs, governed. Having voluntarily created an oligarchy of competing interests, Kuwait, in effect, was ruled by popular consent. The contract among the families was the seed of a quasi-democratic tradition that has persisted for nearly three centuries. When the oil money started accumulating seriously in the early 1950s, the Sabahs concocted a sophisticated scheme for distributing the windfall. Kuwait City, where 80% of the population still lives (or lived before August), was a town of mud huts. The Emir set about building a modern metropolis, a place not unlike Houston, with its skyscraper business center surrounded by villa-style suburbs. In Kuwait, too, each "suburb" became a self-contained microcosm of a city. The neighborhoods were established as cooperatives. Each had its own supermarkets, schools, medical centers and municipal services. While merely convenient before Aug. 2, the system has served as a lifeline since the invasion. By all accounts, Kuwait City is functioning well for Kuwaitis; however onerous the occupation, Iraq's control of the city is not total. Neighborhood committees provide a range of services one would think impossible in the circumstances: food that was secreted in the early days of August is distributed according to need, rudimentary medical service is available, and as the world now knows, scores of foreigners were successfully hidden from Iraqi authorities for more than four months. Some of those foreigners actively helped the resistance. "We taught them how to make homemade Claymore mines and various antipersonnel devices," says Joseph Lammerding, an American engineer who worked for the Kuwaiti military. "You would take quarter sticks of TNT, which are commonly used in oil drilling, dip them in glue and roll them in buckshot," he explains. "Then you would set them off in the middle of a group of Iraqis. To make homemade plastic explosives, you would cook a mixture of diesel oil and powdered soap." Realizing the Sabahs' vision of a modern city-state required land expropriation--an action that normally leaves individuals poorer but that the Sabahs contrived as a wealth spreader. After a straight-up appraisal of land and homes, people were compensated at rates that often surpassed five times market value. The newly "homeless" pocketed most of the money, since they were given low-interest loans to build new houses and were granted land that had previously been used by grazing sheep and goats. The Sabahs also instituted a cradle-to-grave welfare system. Education, health care and every public utility were provided free, or nearly so. And every Kuwaiti--even the illiterate--was guaranteed a government job for life, as intriguing a way of distributing the booty as was ever invented. To serve the prosperous and perform most of the work, large numbers of foreign workers were attracted to Kuwait by wages far higher than those they could command at home. In the role of contractors, importers, landlords and bankers, many Kuwaitis found themselves members of a privileged minority set above the expatriate work force. A law enacted in the late 1950s required foreign businessmen to take Kuwaiti partners, another risk-free method of wealth creation that made millionaires of many overnight. "It is wonderful on paper," says Hasan al-Ebraheem, a former Kuwaiti Education Minister. "But it has had awful repercussions." By the time of Saddam's invasion, the cleavage between Kuwaitis and non-Kuwaitis had worsened considerably. Foreigners account for more than 60% of Kuwait's population and more than 80% of its work force. "Oil exacerbated the underlying tensions," says Saad Eddin Ibrahim, an Egyptian political sociology professor at the American University in Cairo. "The fantastic wealth made all Kuwaitis keener on emphasizing their Kuwaitiness because being Kuwaiti meant enormous privileges." It is not that the Kuwaitis were ungenerous. The welfare-state umbrella covered non-Kuwaitis almost as well as it protected the natives. Expatriates could prosper, and many did. But everything about the rest of a foreigner's life in Kuwait was demonstrably second class. As naturalization was almost impossible, an expatriate's stay in the country depended on the whim of his employer. Noncitizens could be deported without recourse, and they frequently were when economic demand slackened or political crisis threatened. Foreigners could not own homes or land. Those who worked for the government were eligible for subsidized housing. Those employed in the private sector were forced to find lodgings on the open market, which often meant living in slums, since rents were exorbitant. In time, a housing apartheid grew, with some of the Palestinian neighborhoods dubbed "Gaza" and "the West Bank." Even the Kuwaiti-born children of foreigners could be expelled from the only country they had ever known if they were unable to find work on their own account when they reached 18. There was something of a two-tier system among Kuwaitis themselves. Like preferred shareholders in a corporation that issues A and B stock, only males whose forebears were residents before 1920 were entitled to vote--a mere 85,000 out of 826,500 Kuwaitis. Restricted enfranchisement is only one of the complaints voiced by those who perceive Kuwait as undemocratic: women could not vote; permits required for public rallies were rarely granted; demonstrators were dispersed by force; political parties were banned. When the parliament was suspended in 1986, the press was censored as well, a particularly depressing action because Kuwait's papers, books and magazines had long been among the freest in the region. Whether it was accurate news from Lebanon or the Arabic version of Sesame Street, it could well have originated in Kuwait. Still, an interesting anomaly existed. Even before the invasion--which has naturally caused Kuwaitis to unite behind their leaders--most of those depressed by Kuwait's democratic failings supported the Emir and Kuwait's system of government. Part of the reason is simple. To a Western eye, the list of authoritarian transgressions is chilling, but to those who live in the Middle East, Kuwait was something of a model of political openness. "The fact is that we could criticize everything, even the Emir, without fear of reprisal," says Abdulatif al-Tourah, a KPC employee. "If you spoke out as freely in other Arab societies as we did all the time in Kuwait, you could be jailed or killed." If New Kuwait ever comes to exist, the complaints about a lack of democracy may be moot. The Emir has promised to restore the parliament and increase political freedoms in general. No one claims to have spoken to a Kuwaiti who doubts that pledge. "After liberation," says Professor Ibrahim, the Egyptian sociologist, "I foresee Kuwait as an ever more democratic state--and for that alone it is worth fighting for. But more, you would be fighting for all the principles that the people in the Arab world aspire to." Unique among refugee communities, Kuwait itself has the wherewithal to rebuild its nation. The estimated $20 billion in physical damage is severe but not an impediment--and planning and purchasing for the future are already well under way. Assisted by about 50 U.S. Army civil-affairs reservists, the cream of Kuwait's ministerial employees have been meeting quietly in a downtown Washington office building for six weeks. While Finance Minister Khalifa conceived the project and continues to monitor its progress, the day-to-day work is being directed by Fawzi al-Sultan, a Yale-educated Kuwaiti who has been a World Bank executive director since 1984. Every conceivable need is being addressed. Enough material to equip eight hospitals and a score of clinics, for example, is being purchased from U.S. and European medical-supply companies. More difficult than the task of physically rebuilding Kuwait are the problems of equity that will arise when Kuwaitis return. "For example," wonders Khalifa, "what is fair compensation for loss? Assume that one person's house was worth $1 million before it was destroyed by the Iraqis and that another's was worth $100,000. Does the government assist both to the same degree in dollar amount or in percentage or what? What's fair? What will wash?" But even questions of fairness are dwarfed by the angst that will attend the truly invasive societal changes contemplated for New Kuwait. If there is a consensus among Kuwaitis about anything, it is this: despite its vast wealth, Kuwait's society was sick, and not merely because of democratic failings or the poor treatment of expatriates. "At bottom," says Hasan al-Ebraheem, the former Education Minister, "much was rotted." Harsh as it may seem, al-Ebraheem's assessment is common. Across the ideological spectrum--from those who regularly opposed the ruling elite's every move to some of the elite's most prominent members--the echo startles. "Ours was a culture of dependency," says Tareq al-Suwaidan, a leader of the opposition Islamic Trend movement. "We were the pampered product of an affluent society taken to the nth degree," says Minister of Planning Sulaiman Mutawa. "Everywhere," remarks Ali Jaber al-Sabah, a KPC managing director, "there was the spirit of ba'dain, of `tomorrow.' Any real change was put off. `Why bother?' people would say. `We're making money, the country as a company is making a good return. We'll decide the hard things tomorrow.' But of course tomorrow never came." "Most Kuwaitis were spoiled beyond imagination," says Saud Nasser al-Sabah, Kuwait's ambassador to the U.S. Except at KPC and the investment office, lean and mean because they were (and still are) the lifeblood of the country, merit counted for nothing. "There was no accountability," says Khalifa, "because government employees were promoted automatically. It was impossible to fire civil servants. Several years ago the parliament passed an amazing law. In effect, it said that if someone was performing poorly, he would have been fired. But, says this law, since he was not fired, then by definition he was performing well, and that, in turn, means that he is entitled to a pay raise, if not a promotion, on a regular basis." A long-overdue merit system will probably take shape in New Kuwait. But many of those who supported such a move when it was only a theory may recoil when faced with it in reality. Many will also be upset by a shrinkage in the welfare state's blanket coverage. Modest steps were already in place before August. Budgetary constraints alone will justify further cutbacks--and many would-be recipients will be furious. Education in Kuwait will change too. "Today," says Ali Jaber, whose view is typical, "people go for the sheepskin, not for the knowledge. With employment assured, there is no need to actually learn anything if you are not self-motivated." Performance and accountability "are only the beginning of the new discipline we are going to have to inject into our school system," says Hasan al-Ebraheem. "We have to break up the university, create elite centers of training in specific skills like banking and business, and then we have to encourage those who cannot make it in those places to accept vocational training." The proposed shift in education policy will aid a radical transformation of Kuwait's economy. As oil is a nonrenewable resource, Kuwait's leaders are eager for their country to develop in new directions. "We can become the Route 128 of the Middle East," says Fawzi al-Sultan, referring to Boston's beltway dotted with high-tech managerial and consulting firms. "We can be the financial brains behind industrial enterprises in the rest of the gulf and in the Arab world at large. As our ancestors were often away as merchant traders, so large numbers of us can be working abroad in Kuwaiti-owned enterprises and for others. But only if we are properly trained." Self-reliance, efficiency, a genuine work ethic: ambitious goals that defy dissent. But how can they triumph over ba'dain? The centerpiece of New Kuwait, the key to everything its leaders envision, will be an unprecedented demographic make-over. As quickly as possible, Kuwait's population will be dramatically reduced, perhaps even halved. "How do you get people to actually stop being lazy?" asks Ambassador Saud. "Why should anyone care about a real education, or making do with fewer handouts?" asks Hasan al-Ebraheem. The answer is that nothing will change unless everything changes. And the way for everything to change is to take a country that had more than 2 million people before August and recreate it with only 1 million. "The only way to exit the trap of dependency," says Tareq al-Suwaidan, the opposition leader, who wholeheartedly shares the planners' dreams of a new Kuwaiti demography, "is to make it impossible for people to be reliant on others. Most of those who have done the real work in the past will have to go. Then there will be no choice. The rest of us will have to do the hard work." There are two ways to accomplish a cultural transformation of the magnitude contemplated. One is by governmental decree. The other is to let market forces play. While the goal is set--if still unstated--the manner of execution is not. Those planning for New Kuwait hope for fiat but are prepared for the slower course. "If, for example, the welfare system is cut back," says Fawzi al-Sultan, "if a person who has three servants, which is not unusual, suddenly has to pay the medical bills of those servants in place of the government, then that person is going to think twice about having three as help. So market forces can do the job. It takes more time, but it may be less risky politically." Who exactly would be forced to leave New Kuwait, and who could stay or come? If foreign professionals are still needed, the preferred will be nationals of the countries that supported Kuwait against Iraq. Which means that the Palestinians once more in their history will lose out. "We were welcome at the beginning," says Khalid, a Palestinian who worked for the Kuwait municipality until 1988. "We worked hard to build their country"--as Kuwait worked hard to support the Palestinian cause abroad. Many of the original founders of the P.L.O. began their careers and formed their revolutionary strategy in Kuwait in the late 1950s, including Yasser Arafat, who was a civil engineer in Kuwait's public-works ministry while organizing Fatah on the side. It was Kuwait that arranged the infamous meeting between the P.L.O.'s United Nations representative and U.S. Ambassador Andrew Young; Kuwait that refused the nomination of an American ambassador because he had previously served as consul in Jerusalem; Kuwait that broke diplomatic relations with West Germany in 1965, when Bonn recognized Israel; Kuwait that dutifully deducted a tithe from the salaries of Palestinians working for the Kuwaiti government for remittance to the P.L.O.; and Kuwait that coughed up millions whenever Yasser Arafat cried bankruptcy--at least $60 million over the past six years alone. "With a record like that," says Ahmad, a Palestinian schoolteacher, "who would not feel betrayed by the P.L.O.'s support of Iraq? I would not deny that some Palestinians have looted and done despicable things in Kuwait, but most of us are against what Saddam did. That won't matter, of course. We will be punished for the stupidity of our chief of state--and Arafat will continue his life as a celebrity. The Kuwaitis will say that they will look at each of our cases one by one"--which indeed is what the Kuwaiti leadership says--"but in the end I am sure that almost all of us will be kicked out." Booting the Palestinians will be painful, which is where foreign policy comes in. Many Kuwaitis expect--and would welcome--an indefinite U.S. troop presence on their soil. "Reflagging" the effort by adding Arab troops could make the action more palatable, but "it is the Americans we need," says a Kuwaiti official, "more for pretext than for security. Do you think the U.S. will want a potential Palestinian terrorist threat close to its troops? We don't." There were more than 300,000 Palestinians in Kuwait before Aug. 2. "If there are 100,000 left a year from the end of this, I will be surprised," says a senior official at Kuwait's Higher Planning Council. Will the radical measures planned in exile be accepted at home? Rather than propel change, the shock of invasion may hinder it. "To cope with what has happened," says Hasan al-Ebraheem, "many have come to think of this time as a temporary setback, like an earthquake. Psychologically, people will want to recreate the past as exactly as they can in order to forget what has happened. That is what we must resist. This is a golden opportunity, the invasion's silver lining. If we give in to sentiment and let the old ways come back while saying that we'll reach the hard issues later, we will never reach them." To retard backsliding, Fawzi al-Sultan's planners in Washington are effectively rigging the assumptions. When the group's health expert, or the men from public works, for example, draft their recovery plans, the first question is always, How many people are we supposed to plan for? "When the working hypothesis is 1.3 million, tops," says al-Sultan, "the answers come out in a certain way. Lock those premises in, and the shape of the society will change. Demography is everything." Whether by war or by peaceful means, Iraq's occupation of Kuwait will eventually end. Kuwait Inc. will thrive as it always has, as will most Kuwaitis. The question then is whether Kuwait, the nation, can become New Kuwait. The criticisms of Kuwait have always been overdrawn. At most levels they are simplistic. Often they remind a Westerner of how difficult it was to talk to a communist about the U.S. when one tried to explain that America's society was basically good despite segregation. In their hearts and minds, Americans believed that completely--and eventually, of course, the remnants of at least legal discrimination were abolished. Similarly, Kuwait's problems should be seen in context. Like Israel, an essentially decent nation despite some glaring blind spots, Kuwait before Saddam was a good country in a bad neighborhood. It will surely be that again, but it could be much more. A terrible tragedy has afforded Kuwait the rarest of opportunities, a true second chance. If it rises to the challenge, a good country could become a great one. _ KUWAIT'S HOLDINGS From a nondescript seven-story London building called St. Vedast House, the Kuwait investment Office manages close to $100 billion in foreign assets. "The Office," as it is known to financiers around the world, controls about half the total. A web of banks and other institutions invests the rest. Performance standards are rigorous. "The amounts involved generate considerable commissions," says Kuwaits finance minister, Ali Khalifa al-Sabah. "We rarely get anything but the best people working on our accounts." In addition to the representative list of holdings below, Kuwait Inc. holds sizable positions in all of the New York Stock Exchange's top 100 corporations--3 million shares of IBM common stock, for example. </body> </article> </text>