Managing Resources
This opinion piece notes the differential treatment politicians show resource development depending on who owns the resources.
I have another theory. And mine fits the pattern of resource development – or lack thereof – all over the Western Hemisphere. It comes down to this: Where government has the property right, restrictions on development tend to be low. But when the private sector is the owner, environmental concerns blossom.
Exhibit A is Petrobras. Not only did Mr. Gabrielli say there is no appetite for stopping offshore projects in his country. He went further. “Brazil has one of the freest and most investor-oriented regulation in the world. Even freer than the United States of America,” he said, referring to the climate for oil exploration.
That may be so, but it would be interesting to know why, given Brazil’s prominent embrace of socialism. It could be that the country is changing. After all there is now private-sector competition in the oil industry. Yet it is also worth noting that the Brazilian government has a 58% controlling stake in Petrobras’s voting shares and 32% of its total shares. This means that some of Petrobras profits go straight to the government’s bottom line, giving the politicians more money to spend on bribing their constituents.
In the U.S., Congress doesn’t have nearly such a vested interest in a successful oil industry. What good are corporate profits if they go to shareholders, pensioners and employees? Congress has even been denied the windfall profits tax. For American politicians there is a much greater incentive to respond to the concentrated power of the special interest group known as the “greens.”
Surely you jest. Attempts to ‘protect’ the environment are better understood as rhetorical means to consolidate voters than to, you know, protect the environment. This is surprising to me.
If you ask me resource development should be managed privately and that only a minimal amount of regulation. Politicians should not be able to gain power from the resources or misguided political groups with naive views of the environment.
June 16th, 2008 at 5:39 pm
Politicians should also not be allowed to gain power from the resources of profit-motivated lobbyists and contributors from multibillion dollar oil and energy firms. Remember how gung ho the president was to drill in Anwar? These problems go both ways.
This is why I favor campaign finance reform. Let’s all just rember that you oppose campaign finance reform, meaning you’re encouraging politicians to continue with exactly this type of behavior.
June 17th, 2008 at 1:47 pm
To play devil’s advocate here, I could argue that if the government was more neutral towards business (i.e. less regulation) then businesses would benefit less by swaying legislation this way or that, effectively putting many lobbyists out of work.
Just something to think about.
June 17th, 2008 at 9:08 pm
Of course that is true; however, that’s like saying if diseases weren’t transmissable, we wouldn’t have to wash our hands before eating. The fact is that government does have the powe to regulate business, and there’s no way to take that power away from them unless they give it up voluntarily, and they won’t do that as long as the ones who wield that power are the ones who get campaign contributions and get elected. Shouting in the dark on these forums doesn’t suddenly make the government unable to regulate businesses and hand out subsidies, no matter how much popular support is gathered. But campaign finance reform removes their motive for doing so, and it’s something we may actually be able to get done.