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Do oil-exporting nations deserve compensation for carbon taxes?
October 14, 2009 7:44 AM   Subscribe

"If wealthy countries reduce their oil consumption to combat global warming, they should pay compensation to oil producers." Previously.
posted by anotherpanacea (81 comments total) 6 users marked this as a favorite

 
LOL
posted by hermitosis at 7:48 AM on October 14, 2009 [37 favorites]


Well, that tears it. Who needs their lousy oil? We'll just...

... Wait, what did you just say?...

... uh... never mind.
posted by Joe Beese at 7:51 AM on October 14, 2009


To be fair, they're asking for economic assistance to diversify their economies as demand for oil drops off (heh). It's still pretty opportunistic.
posted by Popular Ethics at 7:51 AM on October 14, 2009


It's such a beautifully absurd idea that I can only imagine it gaining traction and being implemented.
posted by Forktine at 7:52 AM on October 14, 2009 [9 favorites]


Short of cash, are they?
posted by WPW at 7:54 AM on October 14, 2009 [4 favorites]


I am surprised that the Saudis would have reached this point already. I thought a tactic like this was still several years off. It seems odd that they are attempting to play into a role of weakness, as in the long term, the growing market for oil in China would compensate for most of the losses they will incur by the west using less oil.

I don't believe their strategy will work well. It may keep the cost of oil up for a year or two, but it really shows a weaker bargaining position in the long term.

The west's short-term-focus economic planning must be rubbing off.
posted by chambers at 7:55 AM on October 14, 2009


they're asking for economic assistance to diversify their economies as demand for oil drops off

We're talking about big, flat, low-ish latitude countries with an infrastructure for delivering energy and a lot of sunshine, right? Hmm, I can't think of anything they could be doing other than pumping carbon out of the ground and into the air, nope.
posted by DU at 7:56 AM on October 14, 2009 [27 favorites]


I don't think they realize that many Americans view their economic downfall as a positive thing.

In fact, we'd have had electric cars 20 years ago if USA politicians had only pitched Going Green as Defeating Arabs.
posted by You Should See the Other Guy at 7:56 AM on October 14, 2009 [13 favorites]


To be fair, they're asking for economic assistance to diversify their economies as demand for oil drops off (heh).

Maybe they should have thought of that instead of building monuments to excess (e.g., the UAE) or concentrating the wealth in the hands of an aristocracy (e.g., Saudi Arabia). They could've done what Norway did, for example. It's their own fault for being short sighted and greedy.

I have absolutely no sympathy for them. By an accident of geography they had access to a huge amount of high-margin wealth, made that margin even higher with a cartel, and still they squandered it.
posted by jedicus at 7:57 AM on October 14, 2009 [24 favorites]


"Before 1950, the pilgrims to Mecca came bearing gifts for their Saudi hosts. After 1950, their Saudi hosts showered them with gifts." -- Wilfred Thesiger (The Arabian Sands)

There is no doubt the bin Saud family is looking to keep things the way they have 'always' been.
posted by parmanparman at 7:59 AM on October 14, 2009


Oh wow, fuck you guys so hard. You found treasure in your back yard, and rather than investing it wisely at all, you've squandered it. Now that it looks like your treasure might devalue, you want people to give you money so that you can continue your opulent lifestyle?

Seriously, if they had any fucking sense at all, they'd have re-invested their money heavily into modernizing their country, making their schools top-tier, diversifying into modern energy research, and so forth. I am really surprised that countries/companies entrench themselves so readily rather than parlaying their current successes into future successes. Instead of trying to milk petroleum for everything it's worth, corner oil AND solar panels. I mean, Saudi Arabia has a lot of sun and a lot of silicon, right? Use your cheap oil to manufacture cheap solar panels!
posted by explosion at 8:00 AM on October 14, 2009 [16 favorites]


Haven't Qatar and the UAE been doing that all by themselves for some time now?
posted by dilettante at 8:00 AM on October 14, 2009


Oh, dear. Could this mean that they will curtail snow-making and raise lift ticket prices in Dubai?
posted by VicNebulous at 8:04 AM on October 14, 2009 [6 favorites]


they'd have re-invested their money heavily into modernizing their country, making their schools top-tier, diversifying into modern energy research

But then they wouldn't have this awesome indoor ski slope.
posted by electroboy at 8:04 AM on October 14, 2009


Dammit, VicNebulous.
posted by electroboy at 8:05 AM on October 14, 2009


Ah ha. Haaa hahahahahahahahaa. How do you say "Please, with the compliments of myself and my whole extended clan, accept this large bags of delicious dicks for your immediate consumption" in Arabic?
posted by rusty at 8:07 AM on October 14, 2009 [54 favorites]


“It is like the tobacco industry asking for compensation for lost revenues as a part of a settlement to address the health risks of smoking,” said Jake Schmidt, the international climate policy director at the Natural Resources Defense Council.

Little more needs to be said.
posted by bpm140 at 8:08 AM on October 14, 2009 [2 favorites]


Sympathy Meter: Zero
posted by LakesideOrion at 8:10 AM on October 14, 2009 [3 favorites]


They could've done what Norway did, for example.

Well, the Saudis and UAE and other Arab countries have got Sovereign Wealth Funds of their own, too (which is what the Norwegian pension fund is). Some of which have even higher asset value than the Norwegian one.
posted by Infinite Jest at 8:10 AM on October 14, 2009


The issue for the Saudis isn't world demand dropping off, it's a combination of skyrocketing domestic demand (eating up the hard currency-paid export opportunities) and declining production at their super giant fields. China isn't going to absorb any decline in Western demand, because a) the Saudi domestic market is already doing that, and b) the oil won't be there to buy anyway.
posted by kowalski at 8:14 AM on October 14, 2009


Fuck the Saudis. The sooner we can disengage from them and their ilk, the better.
posted by Scoo at 8:16 AM on October 14, 2009


If they were located on Wall Street rather than Saudi Arabia, legislation to thise effect would already have been proposed and passed.
posted by Astro Zombie at 8:17 AM on October 14, 2009 [12 favorites]


You just know we'll end up paying them, though, lest it turn into Afghanistan 2.
posted by echo target at 8:18 AM on October 14, 2009


Well, the Saudis and UAE and other Arab countries have got Sovereign Wealth Funds of their own, too

Yeah, but how equitably is that wealth distributed amongst the populace? And do the Saudi and Emirates citizens have the same rights and legal protections as Norwegians do that enables them to start and run successful non-oil-based businesses?

The answers are 'not very' and 'not even close.'
posted by jedicus at 8:19 AM on October 14, 2009 [3 favorites]


Is there a large demand on the global markets for chutzpah? I only ask because it looks like the Saudis have that in abundance; maybe they could try exporting that.
posted by entropicamericana at 8:19 AM on October 14, 2009


On a serious note -- yeah, see echo target above. If oil income were cut off to Saudi Arabia without anything else being done, it'd be a shitstorm that would probably absorb the entire middle east in a whole new round of general warfare. I should probably cast that in more definite terms -- it will be a total clusterfuck, and bad times are coming in that part of the world unless we start thinking about it now.
posted by rusty at 8:20 AM on October 14, 2009 [1 favorite]


I expected the "Previously" link to go to the predominantly petroleum export economies of the late '70s that nearly collapsed due to the sudden decline of oil money. Venezuela and Mexico were particularly hard hit, after years of warning that they should diversify their economies. It's pretty much a case study in developmental politics 101 about how many of the current countries with insane IMF debt overextended themselves with entitlement spending rather than infrastructure investment, leading to the need for more development loans once their export market crashed.
posted by klangklangston at 8:22 AM on October 14, 2009 [1 favorite]


"If wealthy countries reduce their oil consumption to combat global warming, they should pay compensation to oil producers."

Hang on, the oil producing countries are the wealthy ones, aren't they? So it's within their power to just do this, and has been for decades.
posted by FishBike at 8:23 AM on October 14, 2009


I appreciate the offer. It's reassuring to know that you would approach us with this genuine olive branch of financial equity. We have discussed your proposal at great length and come to the conclusion that you can fuck right off.

All joking aside though, a business model where you get paid when people don't buy what you're selling is pretty awesome business if you can get it..
posted by Lord_Pall at 8:25 AM on October 14, 2009


Seriously, if they had any fucking sense at all, they'd have re-invested their money heavily into modernizing their country, making their schools top-tier, diversifying into modern energy research, and so forth.

That's harder to do than it sounds, though. There have been many countries over the years that have had hugely successful exports for a temporary period of time, and very rarely have they managed the money well enough to prevent an economic disaster once the bubble bursts. It doesn't matter whether it's sugar cane, bananas, textiles, or oil. And it doesn't help matters that a developing country with a naive or corrupt government can easily be duped into spending large amounts of money on projects that are really only designed to put money in the pockets of foreign developers. But that doesn't mean that anyone should bail them out when the money runs out, either.
posted by burnmp3s at 8:26 AM on October 14, 2009 [1 favorite]


It's a good argument actually. The same logic is used in international trade agreements. A loss of trade in one sector is made up for in another. The difference here is how stark it is since SA has one giant export:oil and not many imports as a small country.

SA has been modernizing and has a plan (perhaps not to our liking) but it takes a few generations, an unexpected loss in revenue would set back that plan and lead to instability which would be a problem for the West. An unspoken bargaining chip here is the threat of terrorism from an unstable SA. ie. it may be cheaper to put SA on welfare and have a hand in its development than to fight it.
posted by stbalbach at 8:26 AM on October 14, 2009 [1 favorite]


We're talking about big, flat, low-ish latitude countries with an infrastructure for delivering energy and a lot of sunshine, right?

Uh, well, they have infrastructure for delivering oil, but they haven't really been building flywheel factories or whatever they would need to export electricity to the world, which it seems like you're implying.
posted by adamdschneider at 8:26 AM on October 14, 2009


In fact, we'd have had electric cars 20 years ago if USA politicians had only pitched Going Green as Defeating Arabs.

Except that back then the Arabs were Russkies.
posted by acb at 8:29 AM on October 14, 2009


a business model where you get paid when people don't buy what you're selling is pretty awesome business if you can get it.

Well hell, we've been paying farmers to throw shit away for decades. If we combine the two, we could pay a private agency to throw unsold gas on unsold corn and burn up the whole pile, thus propping up two markets and creating thousands of jobs in Corn Burning!
posted by echo target at 8:30 AM on October 14, 2009 [6 favorites]


Who do they think they are - bankers?
posted by Phanx at 8:31 AM on October 14, 2009 [2 favorites]


Why are these comments so harsh about our allies? our friends? In fact, it is nearly a cliche that any resource nation will get in serious trouble if it depends and focuses only upon the one product theyare blessed with --see Diamond and other writers on this .
posted by Postroad at 8:36 AM on October 14, 2009


echo target: Not really. Since Nixon we've been pushing farmers to produce way more corn than we need, and paying the difference between what it costs to grow and what a massively oversupplied market will pay for it. This is because it got politically embarassing to pay for farmers not to grow anything, in a way it is apparently not politically embarassing to have a nation full of morbidly obese diabetics.
posted by rusty at 8:37 AM on October 14, 2009 [4 favorites]


Without too much of a digression -

Well hell, we've been paying farmers to throw shit away for decades.

I think you mean Cargill, not "farmers".

Also, the subsidy system puts a minimum floor on the price of crops. So you have a farmer. He grows corn. Corn price that Cargill pays is 3.00, minimum corn price guaranteed from the government is 3.92. Government pays Farmer .92 cents per unit of corn.

Cargill gets nicely subsidized corn. Farmer gets encouragement to massively overproduce a single crop and scale their farm to monoculture monstrosities. If they don't, they go out of business.
posted by Lord_Pall at 8:39 AM on October 14, 2009 [4 favorites]


Some rambling impressions... After FDR took the US off the gold standard, America financed WWII by printing more money than we could back up with our gold reserves. As a direct result, our economy became robust, the dollar became thought of as an "unsinkable" currency. For several decades, OPEC refused to take any currency other than the American dollar in exchange for oil -- all at the behest of Saudi Arabia. All countries looking to buy oil from OPEC had to first acquire US Dollars and only then could they buy from OPEC.

The international dollar standard policy meant that many countries across the globe kept massive reserves of US dollars in their coffers, so they could pay for oil. This has been a huge boon for the US economy: our money is in demand to a far greater degree than what we produce through our GDP. The international dollar standard has financed America's prosperity for the last 40+ years, and in many ways explains our pervasive global influence, which isn't solely the result of our military strength.

Over the years, many countries (especially third worlders) have tried to break OPEC's requirement. No dice. The Saudis are and were in control, although there have been indications that (this may be changing.)

Three countries announced within the last decade that they were no longer going to accept US dollars for oil, and instead would go to a Euro standard. They were: Iraq, Iran and Venezuela.

Coincidentally (or not,) the Bush administration declared war on Iraq, and saber-rattled Iran and Venezuela -- whose leaders were more than happy to play along. Conspiracy theories abound on the net that we only launched the Iraq War to depose Hussein and set up a puppet government which would go back to the international dollar standard. Total batshit insanity, perhaps. But make of it what you will. Venezuela has foreign exchange reserves of $40bn US dollars. If the world were to follow the example set by Iraq, Iran and Venezuela, went off the dollar standard and dumped their dollar reserves, the US might experience an economic disaster.

Meanwhile, the dollar is weak and its inflationary value is tied directly to the price of oil and that means the price of oil stays high. But there are disadvantages to it being so closely tied to the American economy. So, now many Gulf states want to print their own currency to be used in place of the dollar with OPEC.

Anyway, it seems to me that this latest tactic is merely a Saudi initiative to save themselves if those efforts to derail the international dollar standard are successful.
posted by zarq at 8:39 AM on October 14, 2009 [17 favorites]


The audacity is astounding.
posted by zennoshinjou at 8:41 AM on October 14, 2009


The part that makes it completely untenable, not merely ridiculous, is that peak oil is at least as pressing a problem as climate change. A serious effort to move a first world country's infrastructure off petroleum would take enormous quantities of petroleum.

The part that makes it ridiculous, rather than untenable, is that some of the hottest, lowest-lying regions in the world are complaining about efforts to stop global warming.
posted by khafra at 8:44 AM on October 14, 2009 [2 favorites]


It's worth considering the Resource Curse.

When a developing nation starts to export a lucrative natural resource, then its currency goes up. That means its other exporters (manufacturers, farmers) become less competitive compared to other developing nations. That makes it harder to diversify into other sectors.

Norway didn't have that problem so much, since by the time the technology to extract oil from under the North Sea was available, it was already a developed nation.
posted by TheophileEscargot at 8:46 AM on October 14, 2009


Uh, well, they have infrastructure for delivering oil, but they haven't really been building flywheel factories or whatever they would need to export electricity to the world, which it seems like you're implying.

I wasn't really thinking of physical infrastructure. More like the analyst brainpower and tools for projecting energy requirements, large-scale engineering firms and so forth.
posted by DU at 8:46 AM on October 14, 2009


I am really surprised that countries/companies entrench themselves so readily rather than parlaying their current successes into future successes.

And catch hell from the investors for not maximizing short-term profits? No way in hell.
posted by Thorzdad at 8:47 AM on October 14, 2009


Jedicus: Yeah, but how equitably is that wealth distributed amongst the populace?

I was responding more to the 'they've squandered it' part of your post, rather than the 'they're not sharing it out fairly' part; apologies if that was unclear. No argument with you about the distribution.

While they've apparently squandered a lot of it, the fact that they've set up SWF's shows that they are saving large amounts as well. Which really negates the argument in the article, IMO: they're sitting on these reserves, why not use those to change their industrial base?
posted by Infinite Jest at 8:55 AM on October 14, 2009 [1 favorite]


acb: "Except that back then the Arabs were Russkies."

We have always been at war with Eastasia.

Now off to Room 101 with you.
posted by Joe Beese at 8:59 AM on October 14, 2009


Whale, oil beef hooked!
posted by Darth Fedor at 8:59 AM on October 14, 2009 [1 favorite]


That's like making beautiful women pay more attention to me as my baldicity increases each year.
posted by digsrus at 9:12 AM on October 14, 2009 [2 favorites]


"If wealthy countries reduce their oil consumption to combat global warming, they should pay compensation to oil producers."

Wait, so they want us to pay alimony?
posted by quin at 9:18 AM on October 14, 2009


Shoulda saved your money, suckos!
posted by ignignokt at 9:23 AM on October 14, 2009


"it'd be a shitstorm that would probably absorb the entire middle east in a whole new round of general warfare."

But it takes money to buy guns and bombs and stuff. So that would probably sort itself out right quick, no cash coming in means they'd only be able to blow up 3 or 4 other countries before they ran out of dough.

All we have to do is not be one of those 3 or 4 other countries. They have no reason to target us, right? ... Right?
posted by caution live frogs at 9:23 AM on October 14, 2009


So if a country loses revenue due to global warming, should they receive compensation from oil producers?
posted by Benjy at 9:26 AM on October 14, 2009 [4 favorites]


Hahahaha

they're asking for economic assistance to diversify their economies as demand for oil drops off

HAHAHAH, BECAUSE DIVERSIFYING OUR ENERGY INFRASTRUCTURE IS SUPER-CHEAP!!
posted by delmoi at 9:26 AM on October 14, 2009


Venezuela has foreign exchange reserves of $40bn US dollars. If the world were to follow the example set by Iraq, Iran and Venezuela, went off the dollar standard and dumped their dollar reserves, the US might experience an economic disaster.

$40 billion might be a lot for you or me, but it is not a lot of U.S. Dollars. The U.S. governments writes checks that big every week.
posted by delmoi at 9:31 AM on October 14, 2009


We're talking about big, flat, low-ish latitude countries with an infrastructure for delivering energy and a lot of sunshine, right? Hmm, I can't think of anything they could be doing other than pumping carbon out of the ground and into the air, nope.

SOLOPEC Nations Warn Sun's Output May Fall Short Of Demand
posted by CaseyB at 9:37 AM on October 14, 2009


I want all those cities that no longer use horse-and-carriage as primary sources of transportation to provide compensation to my company so we can continue to make buggy-whips.

In response to those who think I should have reinvested profits while I had them, well, I say "NYAH!" to you, sirs.
posted by clvrmnky at 9:40 AM on October 14, 2009


Saudi Arabia? Wait a second, isn't Al Qaeda a Saudi Arabian organization? Didn't a group of Saudis bomb the World Trade Center? And the USS Cole? On 9/11, weren't 16 of the 19 hijackers, and mastermind Bin Laden, Saudis?

And isn't this one of the nastiest dictatorships in the world? And some of the tightest censorship of any country, anywhere? Where women, gays and other minorities have no rights at all? With one of the largest income disparities in the world between rich and poor? So we know that any money we gave them would not go to the people most affected by global warning, but rather the evil, rich, hereditary rulers?

Words cannot express my contempt.
posted by lupus_yonderboy at 9:49 AM on October 14, 2009 [9 favorites]


Alberta removed all income tax and basically gives away university education with their oil revenues. Fuck the Saudis.
posted by GuyZero at 9:58 AM on October 14, 2009


Wait. Isn't this like me saying: "I demand to be compensated for the fact that currently, no one wants to utilize my brilliance as a conservation biologist, and my intellectual capital is going to waste, and that going out and getting a different job in another, but related, field is just so haarrrdd!"

(Unemployment checks notwithstanding, of course).

Morons.
posted by East Siberian patchbelly wrangler at 10:01 AM on October 14, 2009


what
posted by whimsicalnymph at 10:14 AM on October 14, 2009


Maybe they should have thought of that instead of building monuments to excess (e.g., the UAE) or concentrating the wealth in the hands of an aristocracy (e.g., Saudi Arabia). They could've done what Norway did, for example. It's their own fault for being short sighted and greedy.

This is incidentally a ridiculous comment. Most of the UAE's oil money has in fact gone into either SWFs (like Norway's) or infrastructure. There's a plan to build 1300 km of new railway, a carbon-neutral city, billions in available subsidies for solar research. The UAE's SWF recently bought large stakes in several thin-film solar manufacturers, obviously they know which way things are going. This is in addition to the enormous amount of road, light rail, and electrical infrastructure that's been built in the last 30 years. Sure a little money (most of it from private investors) was spent on ridiculous vanity projects, but somewhere in there they also managed to build the largest artificial deep-water port in the world (For the cost of a Nimitz sized repair drydock, they essentially bought themselves the world's best navy to protect it - clever, no?).

Fuck Saudi though.

The fact that Emiratis do not have the same free speech rights as Norwegians has no bearing on their ability to successfully start businesses, anymore than this has been a problem in China - in fact, property rights are much stronger in the UAE than in China. The obstacle to them starting businesses has been the extremely generous government benefits that Emiratis get and the easy, high-paying government jobs.
posted by atrazine at 10:16 AM on October 14, 2009 [2 favorites]


"If Thomas Edison invented the light bulb today, the news media would report, 'the candle industry is in peril.'" [link]

Metafilter calling out Newt Gingrich for being (almost) right? I think the Internet just imploded.

To be fair, Newt was haranguing Dan Rather/the "liberal media elite" for what he perceived as their ridiculous protectionist leanings; the fact that the Saudis do engage in such demands doesn't in any way validate the jeer - though I won't be surprised if the likes of Glen Beck seize on this. Also, I know that's not how most people use the word "protectionist," but if the shoe fits...
posted by jock@law at 10:18 AM on October 14, 2009


jock@law: "If Thomas Edison invented the light bulb today, the news media would report, 'the candle industry is in peril.'" [link]

I'd put it more like "if Thomas Edison invented the light bulb today, those spineless bastards in Washington would cave to the Big Candle lobbyists and subsidize a failing industry with my tax dollars."
posted by paisley henosis at 10:36 AM on October 14, 2009 [3 favorites]


delmoi: $40 billion might be a lot for you or me, but it is not a lot of U.S. Dollars. The U.S. governments writes checks that big every week.

My point is not quite so simplistic. When one country dumps the dollar, others feel encouraged to follow suit. We live in a global and interrelated economy. Don't discount the effect putting $40bn back into circulation might have:
" Developing countries have likely sold about $30 billion for euros, yen and other currencies each month since March, according to strategists at Bank of America-Merrill Lynch.

That helped reduce the dollar’s weight at central banks that report currency holdings to 62.8 percent as of June 30, the lowest on record, the latest International Monetary Fund data show. The quarter’s 2.2 percentage point decline was the biggest since falling 2.5 percentage points to 69.1 percent in the period ended June 30, 2002."

It is likely that this trend will accelerate on its own. Also, a UN panel is calling for change.
posted by zarq at 10:43 AM on October 14, 2009


I'm currently not producing oil. Please remit payment immediately.
posted by Ogre Lawless at 10:48 AM on October 14, 2009 [5 favorites]


It seems the Saudis have invested all their spare cash in balls.
posted by InfidelZombie at 10:50 AM on October 14, 2009 [7 favorites]


Many of us are upset that oil-rich nations haven't managed their oil revenues in a more productive, long-view way. But it's an acknowledged phenomenon that resource wealth is seldom managed so wisely. The same properties that make oil so very useful make it particularly bad in this regard; only a relatively few humans are involved in the extraction and transport of huge amounts of energy in the form of oil, so oil revenues tend to wind up concentrated in a small number of wallets.

Which is not to defend the idea that oil consumers should now pay extra for the privledge of not using so much oil, which is ridiculous. I'm just pointing out that the answer to "Why didn't they invest those oil revenues in the future," is "Because that's just not the way the world is; pretty much no one ever does that." Oil-rich nations worried about their future in a world of declining oil revenues are the rule, not the exception.
posted by Western Infidels at 10:58 AM on October 14, 2009


"Because that's just not the way the world is; pretty much no one ever does that."

I used the same argument against sufferage! Damn women.
posted by GuyZero at 11:12 AM on October 14, 2009


To be fair, they're asking for economic assistance to diversify their economies as demand for oil drops off (heh).

Perhaps spending less on buying English football teams and gold-plated Ferraris would help the oil producing nations of the world.
posted by rodgerd at 11:23 AM on October 14, 2009 [1 favorite]


Perhaps the House of Saud should have a word with the RIAA's legal team.
posted by acb at 11:48 AM on October 14, 2009


Isn't this how the American government already deals with farmers?

I'd laugh if this wasn't already common practice.
posted by blue_beetle at 11:57 AM on October 14, 2009


Alberta removed all income tax and basically gives away university education with their oil revenues.
Yeah, but you have to live in Alberta.

And, let's be clear here: Canada is driving oil revenues at the expense of their future. No amount of oil revenue will be able to offset the (direct or otherwise) social, environmental and political damage that a single "oils sands" project causes. Mostly because no one really cares about those costs.

I wonder if those tax-free Albertans are looking forward to a day when they have to pay a large premium to have drinking water delivered to their houses?
posted by clvrmnky at 12:26 PM on October 14, 2009 [2 favorites]


I wonder if those tax-free Albertans are looking forward to a day when they have to pay a large premium to have drinking water delivered to their houses?

At least they're doing something with the money other than building a kleptocratic system where it all goes to a small handful of the ruling elite. That the oil sands is nonviable in the long term is a separate issue from how the government revenue from such projects is distributed.
posted by GuyZero at 12:32 PM on October 14, 2009 [1 favorite]


Postroad: "Why are these comments so harsh about our allies? our friends?"

Uh, I'm not really sure that the Saudis are anything but fair-weather friends. They have something that we need really, really badly. And so as a result we pay them a lot of money; probably an amount that's just slightly cheaper than what it would cost to go over and just take the oil by force. (Which, with Iraq in the rear-view mirror, turns out is quite a bit more difficult than we might have assumed at various times in the past.) We get oil, they get cash, with cash they get arms, with arms and cash they get security both domestically and internationally.

But without oil, it's not clear that the House of Saud and the US Government would have anything in common. In fact, probably quite the opposite; they're mainly responsible for promulgating a branch of Islam that is not only sexist and repulsive to many Americans, but also prone to radicalization and violence. Without the relationship that oil built, they might have been the ones taking the post-9/11 fall, rather than Iraq. At the very least, they'd probably just be ignored like most other poor, strategically irrelevant countries in the world.

When the oil dries up, about the only interest I can imagine most Western countries having in the Gulf states is in keeping them from becoming terrorist hotbeds, or Somalia-esque failed states that can threaten world trade. But if they show signs of going down either of those routes, I doubt that the deal will be the no-strings-attached cash they've been getting for so long.

Granted, SA is sort of the most extreme example of the oil-producing countries. There are others, like Mexico, which have obvious shared interests besides oil with the US. Most of the non-OPEC countries are fairly friendly for reasons beyond oil as well. (Perhaps that's why they're non members of OPEC.) But with the exception of Mexico, I can't see many of the major non-OPEC producers* coming hat in hand, threatening to become a failed state if they don't get a handout. Mexico might be a big problem, because PEMEX is both a huge employer and a giant source of revenue for the government that they'll need to replace, but it's sort of a unique situation. If it didn't share a border with the US, it would probably not get anywhere near the amount of attention and aid that it's likely to.

Major non-OPEC producers are Russia, the United States, China, Mexico, Canada, Norway, and Brazil. cite
posted by Kadin2048 at 12:56 PM on October 14, 2009


I'm not really sure that the Saudis are anything but fair-weather friends

They are, in the parlance of "the street", your pusher.
posted by GuyZero at 12:59 PM on October 14, 2009 [2 favorites]


It immoral to fund economic development in any country that uses slave labor, i.e. any gulf state. Oh, yeah, Fuck You Oil!
posted by jeffburdges at 1:41 PM on October 14, 2009


Postroad: Why are these comments so harsh about our allies?

Agreed. Eye-rolling aside, in the conflict with al-Qaeda, the Saudi government is on the same side as the West (namely, trying to preserve the status quo). A recent AFP story describes the ongoing violence in Saudi Arabia.
posted by russilwvong at 2:26 PM on October 14, 2009


Ah ha. Haaa hahahahahahahahaa. How do you say "Please, with the compliments of myself and my whole extended clan, accept this large bags of delicious dicks for your immediate consumption" in Arabic?

My deepest, sincerest apologies for this fellow's rude behaviour, your highness! Please, never mind this viciousness. Rest assured, for these terrible losses which you have brought to our attention, we will give you just compensation... in farts! Like this!
posted by Anything at 4:44 PM on October 14, 2009 [1 favorite]


It's a fungible good, is there any way to really reduce demand? Maybe we'd be better off making a strategic stockpile of plastic and fertilizer (I know that's probably ridiculous).
posted by BrotherCaine at 4:49 PM on October 14, 2009


I'm laughing so hard, I'm crying.

And no, it's not the Vicks VapoRub I just dabbed beneath my eyes...
posted by darkstar at 9:09 PM on October 14, 2009


That's like making beautiful women pay more attention to me as my baldicity increases each year.
Hey, digsrus, it's not like you weren't warned about Peak Sexiness.
posted by hattifattener at 10:02 PM on October 14, 2009 [1 favorite]


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