Hugo Chavezitis

Walter Russell Mead pokes some gentle fun at David Rothkopf, who fears that the shale boom will distract the country from its real work, like a shot of morphine that "hides the pain" and "clouds the vision":
America, once doomed because it had no more oil, is now even more doomed because it has too much:
It looks like the United States is showing the early symptoms of a particularly nasty case of the Resource Curse.  The dreaded syndrome, also known as Hugo Chávezitis, tends to strike countries when they tap into large finds of oil, gas, or other valuable natural resources.  Although such bonanzas clearly have their advantages, the influx of new wealth often leads countries to neglect real underlying problems or the requirements of long-term growth simply because they can spend their newfound riches to paper over their troubles.
And what are the "real underlying problems" the country needs to be solving?  The usual: "building human capital and promoting sustainable economic growth." The "other drivers of long-term prosperity, such as education and infrastructure."  (Ah, infrastructure:  code for "turn over all your money for boondoggles and pork.")  What's more, although it will be wonderful to convert oil- and coal-burning plants to clean shale gas, that will only make people lose interest in climate change without eliminating enough CO2 to save the world.

The dire warning about Chavez should make the reader stop and consider how our two countries might approach a resource boom differently.  Chavez, no doubt, would love to blather about"building human capital" and promoting "sustainable economic growth," while driving long-term prosperity with "education" and "infrastructure," if only he could commandeer the proceeds of the boom and administer it all through a tight clique of central planners who know best.  Here in the benighted old U.S.A., we haven't quite reached the point where our wise leaders will have the sole power to direct the use of the new resources.   It is to be hoped, therefore, that the private sector will put a lot of them to use driving long-term prosperity with old-fashioned things like widely dispersed business and jobs.

We've got some Hugo Chavezitis going on here, that's for sure, but it doesn't take the form of a shale boom.  It's personified in President Obama, Harry Reid, and Nancy Pelosi, and its primary symptom is the belief that confiscation is a substitute for production, as long as you have progressive ideas for how to spend the loot.


Grim said...

Dr. Mead has been engaging this last year or so. I'm not sure if I agree with his general argument, but I've enjoyed watching him develop it.

Assistant Village Idiot said...

Norway has discovered lots of new resources. Why are there no concern trolls about what the Norwegians will do.

The oversimplification is that many on the left dislike market competition because they don't get status that way, other people do. But they like government intervention and more socialist policies because their skills - and thus their status - accords with that.


jaed said...

Gahhhh. The resource curse happens when a country has nothing *but* the raw resource in question, and in particular when it relies on foreigners to extract and process the resource: the only thing the country in question does is sit back and collect royalties. Unearned wealth is the resource curse, not wealth in itself.