Comments on: Exporting Globollocks

By: dsquared

dsquared — Mon, 12 Apr 2004 21:28:18 +0000

Abiola, the Mexican constitution prohibits foreign ownership of the oilfields, not private ownership, and says nothing about ownership of refineries and pipelines. You can have as much of that as you like, but AFAICT, selling off the actual ownership of the fields only makes sense if you’re going to recognise a right of future generations to expropriate them, which Airmiles doesn’t. Asq: Well cobblers to you then; I’m not playing twenty questions.

By: Abiola Lapite

Abiola Lapite — Thu, 08 Apr 2004 22:19:55 +0000

“I never said any such thing and I can’t go on with this discussion until you agree that I didn’t.” Fine, I won’t put words into your mouth. It simply looked to me like the logical conclusion to draw from your statements, quoted below:

And it has the effect of helping to create the idea in public debate that there is a crisis in Mexican energy policy which can only be solved by selling off their natural resource birthright. All of which makes me think that “Airmiles” Friedman might be something a little bit nastier than the harmless buffoon I had taken him for.

Now, proceeding on the assumption that I was wrong about your position on the issue, what exactly do you believe about the proper ownership structure for “natural resource birthrights?” If you don’t believe governments ought to own them, how do you reconcile that with your statements quoted above?

By: asg

asg — Thu, 08 Apr 2004 20:58:53 +0000

Yay! We got d^2 to endorse a policy prescription! See, was that such a huge expense of energy? Before I state my own vision of globalization though (and I’m flattered you want to know!), I’d like to know what you meant when you were referring to “the neoliberal vision” that would dominate the future because of powerful interests behind it.

By: dsquared

dsquared — Thu, 08 Apr 2004 20:31:38 +0000

Actually, it is; what the Seattle riots achieved was the scuppering of the Seattle TRIPS agenda. This would have extended first-world patent law globally. As a direct result of the collapse of the Seattle talks, Brazil and South Africa were emboldened to increase their demands and force through a revised TRIPS draft which allowed them to suspend intellectual property law domestically where necessary in order to provide cheap generic AIDS drugs. If I’ve got a positive vision of the future, then global technology operating under locally determined intellectual property laws is a good start. OK now cough up; what’s your vision that’s so much better.

By: Gary Farber

Gary Farber — Thu, 08 Apr 2004 19:25:37 +0000

“Really? We had you on the run in Seattle, didn’t we?” That’s an impressive description of a positive vision.

By: dsquared

dsquared — Thu, 08 Apr 2004 16:10:14 +0000

In fact, I’d say that the example of the United States is a gigantic problem for Dsquared and all those of similar persuasion who wish to argue that private ownership of natural resources is somehow a bad thing. Before we go any further, Abiola, I must insist that you withdraw that remark. I never said any such thing and I can’t go on with this discussion until you agree that I didn’t.

By: Abiola Lapite

Abiola Lapite — Thu, 08 Apr 2004 12:44:01 +0000

"See Jeff Madrick, “Resources Form the Basis for Economic Growth,” The New York Times, 2004 Feb 19." This article isn't news to anyone who's been looking into the subject, and it isn't interesting either. The most important issue, which isn't discussed in the article - the structure of ownership - is precisely what's been at issue in this discussion. In America, oil wells and gold mines were owned by private individuals, not by the government, and politicians had to get their share of the proceeds by taxation, which meant, of course, that they had to actually be responsive to the voting public, mindful of the fact that wealthy owners of resources could and would do their bit to influence public opinion in their favor, in an age without silly campaign-finance restrictions. You picked just about the worst possible article to use to justify an anti-private ownership stance. In fact, I'd say that the example of the United States is a gigantic problem for Dsquared and all those of similar persuasion who wish to argue that private ownership of natural resources is somehow a bad thing.

By: liberal

liberal — Thu, 08 Apr 2004 10:16:34 +0000

My impression from Dean Baker is that Mexico has been much better than Venezuela at capturing the value of its oil for the public (as opposed to the value winding up in a few pockets).

By: liberal

liberal — Thu, 08 Apr 2004 10:13:07 +0000

Re the resource curse: there is an argument that it’s not valid. See Jeff Madrick, “Resources Form the Basis for Economic Growth,” The New York Times, 2004 Feb 19. Main point: “But Mr. Wright and Mr. Czelusta point out that almost every one of these studies uses the proportion of exports of the particular natural resource as a proxy for a nation’s mineral abundance. Among other obvious problems with this measure, a high proportion of resource exports may simply reflect a lack of other kinds of exports, which is almost a definition of underdevelopment in the first place.” Second paragraph: “Gavin Wright will have none of this. Mr. Wright, an economic historian at Stanford and long a specialist in the role that natural resources play in economic growth, agrees that overdependence on a single resource can lead to poor policies, but it is by no means inevitable. To the contrary, many developed and developing nations have used their mineral resources as springboards to wealth and broader-based development – not least the United States itself.”

By: asg

asg — Wed, 07 Apr 2004 21:18:55 +0000

Yes, Seattle worked so well that every anti-globo demonstration since has built on and exceeded its successes. Not. You write: There’s no doubting that the future will be more or less the neoliberal vision; there are too many powerful interests at work for this not to be the case. Why should anyone who does not already agree with you believe this? That is, why should anyone who does not already agree with you take your word that the reason your vision will fail when arrayed against the neoliberal one is “powerful interests” rather than that your vision is just crackpot? Or that your vision is only cosmetically different from the neoliberal one? Or that it oversimplifies things? Etc. This is why not elucidating the positive alternative to neoliberal globalization is political surrender—because no one who doesn’t already share your views (whatever they are) will be charitable when thinking about why your views will not prevail.

By: dsquared

dsquared — Wed, 07 Apr 2004 07:21:56 +0000

Really? We had you on the run in Seattle, didn’t we?

By: asg

asg — Tue, 06 Apr 2004 22:34:35 +0000

But I don’t think a positive vision is appropriate. There’s no doubting that the future will be more or less the neoliberal vision; there are too many powerful interests at work for this not to be the case. It’s much more important to warn people about what the dangerous parts of this program are, than to write recipes for kitchens that aren’t ever going to be built. Reading this brings a warm sense of relief to my heart. It is always heartening to know that the critics (or at least one of them) of a worldview one basically agrees with have no positive vision and no unifying principles. The course d^2 endorses—warning people about what’s wrong with others’ views rather than presenting and defending one of his own—is the most reliably proven recipe for abject political failure yet discovered.

By: dsquared

dsquared — Tue, 06 Apr 2004 22:17:34 +0000

The same is true of diamond and coal mining – it simply isn’t possible for governments to embezzle billions in such fields without a sizable portion of the profits leaking to the general public, if only through the wage bill. Yes it is; example, any diamond producing country except Botswana. While Nigeria has a state oil monopoly, it’s not a monopoly like Pemex, Statoil or Petronas. AFAICT, (and I’m willing to be corrected), it’s never had a monopoly on drilling Nigerian oil and it’s never been the largest E&P company in Nigeria—it’s largely a downstream company. This means that the Nigerian oilfield has been largely developed with foreign money, very much unlike the Mexican, Malay, Norwegian, etc.

By: John S

John S — Tue, 06 Apr 2004 22:03:46 +0000

I’ve been dreaming of your business lounge encounter with Friedman: d2: I read your April 4 column, Friedman you w**r. TF: Great, and…? d2: And? You m**r. You MORON. I checked up the very latest figures and crunched the numbers myself….261 × 1,000,000,000 × 1010 = 263.61trn btu of natural gas net … Friedman? Friedman??? TF: zzzz…. oh, er, sorry, where were you? I mean what about my big idea? d2: Big idea, you f**t? Oh yeah, I calculated that too: 1279 × 1,000 × 365 × 5,865,000 = 2,737.99trn btu of petroleum exported …Net energy imported by the USA from Mexio of roughly two and a half quadrillion btus. Note… TF: What are you talking about? Calculated what?? You mean how important it is for Mexico to be an economic success otherwise there’ll be no end to Mexicans crossing the Rio Grande illegally? And how that might be helped along by deeper economic integration along the lines of the European Union? Even to the point where we adopt a programme like the EUs to create transport networks? You calculated that? d2: [silence] Er, still you f***g s***d, what about the 1279 × 1,000 × 365 × 5,865,000 = 2,737.99trn btu of petroleum exported? Hmm? What about that then?

By: Abiola Lapite

Abiola Lapite — Tue, 06 Apr 2004 21:29:34 +0000

“First, I’m unconvinced by what looks like an ad hoc attempt to push the “oil is special” argument. Could easily be argued the other way; Gold is easy to smuggle because you don’t need a tanker to carry a large value of it, and gold can be hoarded on its own as a store of value” But gold is extremely labor-intensive, and tends to draw in large portions of the workforce naturally; the history of a country like South Africa, with its pass laws to ensure large reserves of cheap labor, and the unworkability of any scheme for racial separation in a country vitally dependent on cheap black labor, makes no sense without recognizing this fact. The same is true of diamond and coal mining – it simply isn’t possible for governments to embezzle billions in such fields without a sizable portion of the profits leaking to the general public, if only through the wage bill. Oil, especially the offshore variety, really is different in that respect. For example, most Equatoguineans have never even set their eyes on an oil rig to date, and domestic labor involvement in offshore production is pretty much nil. It’s pretty much the same in the Niger delta – there wouldn’t be so many jobless Ogoni and Ijaw youths making trouble for the government if oil were a more labor-intensive business. “profits are just as high in the gold, diamonds, etc industry as in oil.” This is an empirically testable statement, and it simply isn’t justified by the facts. It’s easy enough to get copies of the historical annual reports for Ashanti GoldFields, Anglo-American, Barrick, Billiton, Rio Tinto, etc., and the fact is that their profitability cannot bear any comparison with that of oil companies. As for De Beers, the Oppenheimers should only be so lucky as to enjoy the sort of net income even a relatively minor oil producer like Angola (800,000 bpd) does. “In fact, if you look at the state oil monopolies of the world” Eh, the Nigerian National Petroleum Corporation is also a state oil monopoly …