The Global Problem Of The Natural Resource States

THERE IS A difference between a state like the United States and a state like Saudi Arabia. In the United States, the people are a resource. In Saudi Arabia, the people are a cost.

In other words, the leaders of the United States need us, the American people. Our energy, our wealth-producing activities, our knowledge, our patriotism are the foundation upon which the power of the political leaders is built.

But the same is not true of a state like Saudi Arabia, where national income and wealth comes from pumping oil out of the ground. In Saudi Arabia (and in other natural resource states) the people are an annoying cost that reduces the revenue of the political leaders.

This model can be applied globally. States like the United States, Japan, South Korea, India, and China are nations that depend upon their people for their wealth. States like Russia, Saudi Arabia, Iran, Iraq, Venezuela, Nigeria, and now even little Bolivia are natural resource states. They do not produce much of anything that the world wants except their oil or their natural gas.

So when Russia turns off the gas to Ukraine, writes Irwin M. Stelzer, maybe we ought to pay attention. Maybe Russian President Vladimir Putin is sending

a warning to major energy-consuming countries that their long-term prosperity is in the hands of very dangerous people.

The joke is that the natural resource states need us much more than we need them. In the long term, if they push prices above the market then the energy-consuming countries will find other ways of getting energy. In the short term, certainly, they can swing their weight around and cause inconvenience.

Of course, there is no reason why the natural resource countries and their tin-pot dictators should have the influence they do. There are plenty of ways we can reduce their influence. We can build out nuclear power. We can aggressively prospect for oil and natural gas in the mainland US and offshore. But we don�t. We don�t do it because significant portions of our educated elite in the United States and elsewhere in the developed world belong to a post-Christian religious cult that experiences the earth as an expression of the divine. They experience the land outside the cities as a sacred place that should be kept apart. Characteristically, they want to force their religious beliefs onto other Americans.

But that will change. Eventually the people states will deal with the natural resource states. The only question is, shall we do it now, when the cost is manageable? Or shall we let the natural resource states wax in strength and pride and in their ability to cause mischief before we deal with them?

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Christopher Chantrill blogs at www.roadtothemiddleclass.com. His Road to the Middle Class is forthcoming.

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