Emirates Airline is the Middle East?s largest carrier today. And in a year in which most airlines around the world have been feeling under the weather, it announced a tripling of net profit in the six-month period ending September 30?as compared to the same period the previous year. While most carriers have been cutting capacity in the face of recession, Emirates added 22% more seats. Lower fuel prices helped and the company slashed costs, but it also helped that its business model?transferring passengers who used Dubai as a transit hub between the US, Europe, Africa,

India, East Asia and Australia?wasn?t as hard hit as others. In the face of the big credit crisis now overwhelming its home base, some have speculated that the airline will be offered as collateral for a bailout. This possibility has been strongly rebutted, just as Dubai World and others have resisted sales of their top performing assets. What does this say about the Dubai crisis, or the Sheikhs managing it?

Emirates Airline was personally started by Dubai?s present ruler Sheikh Mohammed bin Rashid al-Maktoum in 1985, with $10 million and two planes. Although he formally replaced a brother as ruler of Dubai only in 2006, he has been driving its development for decades. His family, the al-Maktoums, have been ruling Dubai since 1833. In 1972, it joined the seven-member UAE federation. Sheikh Zayed bin Sultan Al Nahyan of Abu Dhabi spearheaded that union. All the emirates are spearheaded by hereditary monarchies, with the Nahyans being cousins to the Maktoums. Royalty commands key roles in both government and business. Dubai World, for example, has been led by Sultan Ahmad bin Sulayem, whose father was a close advisor to Sheikh Mohammed?s father.

When power and decision-making are so centralised, so is the credit for gains and the blame for breakdown. Dubai has seen plenty of gains powered by Sheikh Mohammed, or Sheikh Mo as the western press has called him through years of fawning attention. Comparisons with Dick Fuld will flourish this week onwards, but a majority of opinion pieces filed over the years have been plain bowled over by the staggering development that Sheikh Mo?s ?vision? has delivered in recent years. From a region where headlines?from Cairo to Beirut, Tehran to Tel Aviv?are apt to deliver bad news with tedious monotony, it made sense to welcome news of glamorous properties being etched from the sea, skyscrapers reaching for the sky in the middle of nowhere, a financial hub building bridges between the East and the West, global brands setting up shop and super-luxurious hotels hosting the stay.

A lot of credit for all these developments deservedly went to Sheikh Mo. He told off Arabs who sat around praising a glorious past instead of building on it. He faced up to his emirate running out of oil while its big neighbour remained cushioned by big reserves, and diversified its economy. From women?s rights to alcohol consumption, he also appeared to lead Dubai into a more liberal era. By a relative measure, he appeared to have created an oasis of tolerance in a region rife with the opposite. He is on Facebook and he tweets too!

Golfing in the desert

This year?s European golf tour culminated in the Dubai World Championship, albeit with winner Lee Westwood accepting a cheque representing a 50% reduction over the advertised prize?still, the $1.25m kitty wasn?t too bad given that financial structures were collapsing all around it. The final was played out on a course designed by Greg Norman. Dubai boasts many others, including one named after Tiger Woods?he whose reputation has crash-landed the same weekend as Dubai?s.

Sheikh Mo is known to be a connoisseur and composer of Arabic poetry. One of his oft-quoted sayings is, ?Money is like water. Block its flow and it will stagnate.? Driven by this philosophy, Dubai was transformed into a financial hub and also a golf haven. So plentifully do money and water flow that tourists flock to spend quality time with dolphins of both types. They even get to ski down snow-laden slopes. But wait a moment, isn?t this one of the most water-stressed places in the world? It?s said that the Tiger Woods course is pumped with four million gallons of water every day. Is that sustainable? Is the Dubai model sustainable?

The Sheikh went on to say that if you let money flow freely, it stays fresh. In pursuit of high-class freshness?or the perfect mix of tradition and modernity?he also holds what has been called the world?s richest horse race on his home turf. Guests are welcomed into tents straight out of Laurence of Arabia, but the monies involved are as great as they get. And the attendees include the who?s who of the world.

But the limitations of such a strategy have become obvious over the years. Look back to Dubai Ports World?s attempt to take over port operations in major US cities.

Bill Clinton put his weight behind the plan. So did then President George Bush, who actually threatened to veto legislation against the plan. Sheikh Mo?s reach had spread across the heads of both Democratic and Republican camps, but he had to bow out in the face of American public opinion.

To date, he doesn?t expect to do the same at home. Whether it?s poor labour or rich expats, he expects that everyone will fall in line in gratitude for his largesse. When beaches abound, how does it matter that poor plumbing makes them stink of sewage?

Hence, the royalty?s resistance to palming off its silver. Whether it?s cousins in Abu Dhabi or bankers elsewhere, Sheikh Mo and party imagine a bailout is theirs by right.