Nature's Evil [calibre 5.27.0]

Rawls’s former student Leif Wenar draws a parallel between the oil trade and the buying up of stolen goods. 44 Almost every country in the world, says Wenar, has a constitutional norm according to which the underground resources belong to the people. Voltaire made fun of this idea: it was Pangloss who taught Candide that ‘the goods of this world are common to all men, and that everyone has an equal right to the enjoyment of them.’ In fact, more than half of global oil has been extracted by authoritarian countries which do not ask their people’s consent to this extraction. Such oil is stolen, says Wenar, and all the norms relating to the trade in stolen goods are applicable to the case. Wenar sees in the oil trade an analogy with the slave trade: that struggle was long, but the abolitionists won it. He proposes that global organisations should stop buying oil from any government that does not conform to the minimum criteria of democratic accountability to its own people. It is easy to compile a black list of these countries – what is more difficult is to imagine an international institution which could implement such a law. The power of the consumer is well tested by civil associations such as Fairtrade. But while consumer pressure brought about change in coffee and banana plantations, establishing a similar control over petrostates has yet to be achieved. The difference comes from the way in which the outputs of different farms are mixed in the final product: an addicted consumer can easily reject a particular brand in favour of another one, but if all brands are mixed up he has to reject the commodity as a whole. This is the difference between branded commodities, such as fruits, tobacco and coffee, and sorted commodities, such as sugar, cotton and oil. Decisive for the former, the power of the consumer does not spread to the latter.

Capital gives better returns than labour. The value of inherited wealth grows quicker than the level of pay. The owners of processing industries get rich quicker than landowners or the best of hired workers. These are all reasons for growing inequality. Sacrificing millions of people, wars and revolutions are the most powerful factors enabling equality, while oil-based capitalism boosts inequality. Let’s look at a trade between two states, one resource-dependent and the other labour-dependent. This is a typical situation in the field of international relations – a game for two players, one of whom sells a precious resource which the other buys, exchanging it for goods produced by the labour of its people. The labour-dependent state encourages internal competition, protects property rights, secures technical progress, and promotes public goods and services. None of this occurs in a resource-dependent state and its monopolies. In such a country, institutions don’t develop, nature is degraded, and the people fail to thrive. All this is a curse for a resource-dependent country but a blessing for its partner. Since the rulers of resource states do not guarantee property rights in their countries, they cannot rely on their own capital or hand it down to their children. Along with their subjects, the rulers also suffer from the absence of public goods such as fair justice or clean air. Their spouses need private goods which only labour-dependent states are capable of offering. Children need the high-quality education which is available only on the other side of the border. Parents need good doctors and hospitals. But while textiles or gadgets come from abroad, safe parks, clean beaches, or good schools and clinics are not available to import. So the next step ensues: the elite from a resource-dependent state keeps bank deposits in a labour-dependent state. This is where the elite settles its disputes, buys houses, establishes its families. Exported capital – a converted form of oil and gas – turns into a bank account in Switzerland, a château in France, a business in Germany, or shares in American corporations. This capital, significant by any standards, is profitable to the recipient. The Swiss bank gets a percentage, London property prices rocket, new businesses pay taxes in the host countries. This wealth trickles down, but those who benefit from it are very far away from the places where it was pumped or mined. Paradoxically, the resource-holding elite invests in the same institutions abroad that it ignores, or even destroys, at home: the judiciary, universities, parks. In a dual economy of the post-Soviet type, Rawls’s first principle is realised at one end of the earth, but his second at another. The wealth is created in one country and trickles down in a different country. The blessings for some do not balance the curses for many others: the sum of happiness declines and inequality grows.