108IRAN AND DUBAI LEAD THE WAYoptional, since enforcement by disconnection was unusual. DEWA, how-
ever, took a hard line, giving customers just forty- seven days to pay
before turning off their power and water— unless those customers were
UAE citizens or “certain designated institutions” (presumably linked to
the ruling family, security forces, or prominent tribes). A 2013 financial-
risk prospectus accompanying the issue of a Dubai bond noted that
“UAE nationals are required to pay their own electricity bills.”
But for water, the bond prospectus told a different story. “While the
government encourages UAE nationals to pay their own invoices, the
Government issues credit notes to cover any unpaid residential water
invoices of UAE nationals.”^38 Two years after imposing a charge for water,
the government’s representatives put in writing that citizen payments for
water were voluntary. These policy retreats underscore the complexity of
subsidy reform in an absolute monarchy and the resilience of social con-
tract provisions enshrined in rentier theory. In Dubai, even during a
financial crisis, the regime lacked the clout to enforce an across- the-
board increase in citizens’ utility rates.
Although the loss of benefits triggered a rash of complaints, it did not
appear to inspire demands for democratic representation, as predicted
by academic theory. A UAE- wide petition calling for increased political
participation did emerge shortly after the price increase, but it seemed
inspired by the onset of the Arab Spring, not Dubai’s tariff measure.^39
One petition signer told me that the issues of subsidy reform and politi-
cal participation were not linked in the way described in the rentier lit-
erature. He said energy subsidies were a vestige of the UAE’s emergence
from poverty a generation ago and were now more detrimental than
helpful. Participating in political life was a natural aspiration of an
enlightened citizen.^40
Subsidy reform also exposed Dubai’s ruler to public anger, including
direct petitions by prominent citizens. Welfare reforms are best pursued
when centralized regimes are either secure enough to absorb the political
consequences or when a budgetary crisis or external pressure shelters
leadership from blame. In Dubai’s case, the 2008 financial crisis provided
a helpful shield that enabled the increased prices. But the Arab Spring
intervened. The uprisings reduced the regime’s sense of security and
changed its calculations.