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This describes a protypical dysfunctional organization:

In every society information is a means of making a living or wielding power, but Arabs husband information and hold it especially tightly. U.S. trainers have often been surprised over the years by the fact that information provided to key personnel does not get much further than them. Having learned to perform some complicated procedure, an Arab technician knows that he is invaluable so long as he is the only one in a unit to have that knowledge; once he dispenses it to others he no longer is the only font of knowledge and his power dissipates. This explains the commonplace hoarding of manuals, books, training pamphlets, and other training or logistics literature.

Another reason: They are largely tribal and loyalties are to the tribe (and maybe Islam,) not exactly to the state or to the ruler. The same group of people that will die to the last man if their cousins are attacked, might seek shelter when fighting against an enemy in war he is sent to fight.

Another controversial possible reason, since we're stereotyping: They tend to marry cousins and have done that for generations. That isn't without consequences http://www.as.wvu.edu/~kgarbutt/QuantGen/Gen535Papers2/Inbre...

I think all the arguments need to be viewed in a modern (within the last 300 years) light. I mean the Arab world had a fairly phenomenal military force up until the mongols really obliterated the region.

More so than anything, I think Arab military faliures may have more do with socioeconomical conditions than genetics or tribal construct. Why are Arabs failing now when a few hundred years ago they were far more organised and structured. Can we blame colonialism? Are petrochemical dollars reducing the incentive to develop socially and intellectually?

These cultural traits are older than colonialism. Christian crusaders commented on them in the middle ages and they're the reason that Arabs have a reputation for dishonesty in the West. They're not incompatible with building a large empire if you're enemies are similarly disfunctional.
>Arabs have a reputation for dishonesty...

Thats a fairly significant comment to make. Considering the historic record generally portrays the Arabs more positively than the Crusaders I'm not sur ewhat point you're trying to make. People are making a lot of statements and arguments but there is little actual substance that can be debated, more conjecture.

The problem with this essay is that it's describing war in the conventional sense — I'd argue that war in the 21st century is asymmetrical in nature and maybe not even be fought by nation state vs nation state. So if you look at Hamas in Lebanon or al-Qaeda you get a very different picture. Also with the exception of the first Gulf War you don't often see Arab nations going to war against other Arab nations.
I wouldn't say that it's a problem, it's just outside of the scope of this essay, which focuses on Arab armies:

"Examining Arab warfare in this century leads to the conclusion that the Arabs remain more successful in insurgent, or political, warfare — what T. E. Lawrence termed 'winning wars without battles.'"

This makes it sound like arabs will be unable to ever be good at warfare regardless how good individual soldiers are because of deep cultural issues, which is probably a good thing (at the moment anyway) if you consider the causes that Muslims get passionate about. Look at Libya, Syria, Hamas, Lebanon, Yemen... In all these cases a large number of people are very passionate about controlling others on a very personal level, until they give that up, I hope that they continue to have a dysfunctional military structure.

Though I guess those two are tied together: The article posits that their dysfunction comes from a need for honor and control. If they gave that up, it would become okay for them to be militarily powerful and they would become so (not because it would be okay but because they overcame their dysfunction).

No meritocracy and no trust. Bane of every civilization, army and society