Hacker News Reader

Comment by throwaway27448 | Hacker News Reader

What are the counterexamples? Maybe Nigeria?

EDIT: yes, also Iraq and Venezuela

Norway is pretty much the only country with oil wealth that can reasonably be considered well run (unless you count Canada or the US, which, while resource-rich, have a lot of other things going on and aren't dependent on their petroleum resources).

Of the other countries where petroleum is >10% of the national economy, I think Norway might be the only one that isn't a brutal dictatorship, a failed state, or both?

    > Of the other countries where petroleum is >10% of the national economy, I think Norway might be the only one that isn't a brutal dictatorship, a failed state, or both?

You raise a great point. I wracked my brain trying to think of counterexamples: It is tough!

I found this graphic from CNBC that summarises data from the World Bank: https://assets.weforum.org/editor/0GAQbN2nVTxgIqOLjWpWSZYh-9...

One thing I want to point out: Kuwait is the most dependent upon oil and gas of any nation in the world (about 50% of its GDP). However, I think it would be a stretch to call them "a brutal dictatorship, a failed state, or both". Sure, it isn't a Western liberal democracy, but people live pretty good lives and the state does not have a strong reputation for suppressing its people. (I'm not here to apologize for their gov't... but I think it would be a bit harsh to put in your categories.) UAE, Bahrain, Oman, Brunei, and Qatar: I would put in the same category: Non-democracy or flawed democracy, but life is pretty good for the locals. I guess that we can call all of the countries that I mentioned before: "benevolent dictator" gov't model. Interestingly, Ecuador is about 20% of GDP, but I would call them a developing/emerging democracy. The rest of the list... sheesh: It does not look good!

What do you think about my analysis? Do you agree?

?? Russia, the US, half the damn gulf states seem to be doing just fine (maybe excluding Bahrain and Iraq). Very much including Iran, despite our efforts to strangle it to death for fifty years straight.

> I think Norway might be the only one that isn't a brutal dictatorship

Just because you don't like a government doesn't mean it's doing a bad job at, well, holding a state together.

> Russia

Totalitarian, and trending toward failed state.

> US

Not eligible for the reason I stated: the US economy is much less than 10% petroleum. We have a lot of oil, but we have a lot more of everything else.

> gulf states

Mostly brutal, repressive dictatorships (especially Saudi Arabia and Iran) - some are better than others, but the trend is poor.

> Just because you don't like a government doesn't mean it's doing a bad job at, well, holding a state together

You're moving the goalposts a fair amount here. The thread started with "good governance", and I said "well run" - it's hard to say that the bar for either of those is simply maintaining superficial order. But even if you set that aside, consider the famous quote from the Shiekh of Dubai about the fragility of the petrostates that haven't figured out how to build strong civil societies with their wealth: "my grandfather rode a camel, my father rode a camel, I drive a Mercedes, my son drives a Land Rover, his son will drive a Land Rover, but his son will ride a camel."

> it's hard to say that the bar for either of those is simply maintaining superficial order.

Well it's clearly more than superficial or the state would be collapsing.

Regardless, I don't think the form of the government itself implies any sort of governance quality. Both Russia and Iran are the subjects of such heavy propaganda I don't expect anyone to evaluate them in good faith—but I would certainly prefer to live in either place compared to, say, Mississippi.

“The resource curse” is what you’re looking for. There’s a lot of counter examples - Norway is the odd one out.

I think the resource curse didn't apply to Norway because they had an established post-industrial economy for hundreds of years before they got into oil exporting (they didn't even start drilling until the 1960s, 50 years after Venezuela or the Arab states).

While being an established post-industrial economy is part of it, Norway was also keenly aware of the resource curse at that point. The "Dutch disease" comes from what happened when the Dutch, a liberal democracy, found oil in the 1950s — just a little before Norway did.

A lot is thanks to Farouk Al-Kasim [1], who helped develop the fundamental plan for Norway's petroleum industry. As far I know, his task group's plan, developed while at the Department of Industry, was essentially accepted wholesale by the government. Part of it was ensuring the government retained control, and another part of it was ensuring oil revenue was carefully managed rather than flooding every level of society and government.

[1] https://archive.ph/lEYl7

yeah this is the big one, there was already a track record of natural resource windfalls messing stuff up well before the Norwegians started getting that $$$

this also means there weren't entrenched oil barons (or rail barons, or shipping barons, etc.) that already had massive regulatory capture and could sway the government and economy their way.

greenfields, limited rent seeking, and knowledge of the risks -- sure enough it all went right

Or even the USA historically. Pre 1900s, America was a country of continual economic crises, and fractured politics.

It was sitting at the time in the latest supply of easily exploited natural resources in the world, yet somehow could not pay its troops pensions lost Civil war, could not keep its strategic oil supply from being raided by the executive branch corruption, and could not keep it plutocrats from directing military action for the sake of bananas of all things.

|Or even the USA historically. Pre 1900s, America was a country of continual economic crises, and fractured politics.

Have you read about the US post-1900? I think you can leave off pre 1900s…

Yes but pre 1900s there were vastly more resources.

The USA at some point had the lions share of the world’s easily exploitable oil.

Honestly, pretty much every other resource-rich country: Russia, Saudi Arabia, Iran, Iraq, Venezuela, ...

Norway is an outlier.

Russia, Saudi Arabia, and Iran seem to be doing just fine.

My first job was at a design firm that worked for Samarec Riyadh Refinery. We were design an interactive exhibit based on the refining process.

Our principal was Jewish and we needed special permission for him to enter the country for presentations.

During one of the presentations one of our team took a photo of a fountain and it initially ended up in our presentation to be used to set the tone. While previewing our slideshow to our handlers we were told to remove the slide of the fountain. The fountain belonged to the king and could not be photographed without permission from the king.

Admittedly there was no violence but we were warned that it was very bad. This was the early 1990’s so I’m sure this are much looser now.

In what universe is Russia "doing just fine"?

Reply on news.ycombinator.com