On oil and democracy
It has been something of a truism for several years now that oil and democracy do not tend to make happy bed-fellows. It’s more than a decade since Dick Cheney, who at the time was CEO of Halliburton, remarked on what a shame it was that “the good Lord didn’t see fit to put oil and gas reserves where there are democratic governments”.
But you can, of course, look at it another way. Perhaps it’s the very existence of the black sticky stuff beneath the ground that makes it so difficult for democracy to thrive. (There are, as always exceptions: the UK, Norway and Canada all seem to manage, but it’s probably significant that in these countries democratic traditions were already pretty well established by the time the oil men started drilling.)
Earlier this year, I was in Nigeria to report on the near-farcical presidential election. There was fraud and malpractice on a massive scale: for the first time in my career, I was able to interview, on the record, a man who told me exactly how you go about buying votes at the polling station.
And it was a Nigerian political analyst who made the point that if a government gets the bulk of its revenues from taxes levied on oil companies, it has little need to listen to its own voters. It has plenty of cash, whether or not they support it, and it can always use some of that cash to bribe them. It puts a bit of a different spin on the old American anti-colonial slogan “No taxation without representation”. If it's the oil companies who pay most of the taxes, maybe it’s the interests of the oil companies that the government mostly represents.
So why do I raise all this now? Well, look at what’s been happening to oil prices. The cost of crude is up by 40 per cent since August and could soon be nudging $100 a barrel. (To me, it seems only yesterday that we were worrying about it getting as high as $50. But that’s progress for you.) And where do you think all that extra dosh going?
Here’s the list of the world’s top 10 oil exporters last year: Saudi Arabia, Russia, Norway, Iran, United Arab Emirates, Venezuela, Kuwait, Nigeria, Algeria, Mexico. You don’t need too many fingers to count the democracies, do you?
So when you look at what’s happening in Russia, and you ask yourself why President Putin is so confident of winning the parliamentary elections in December – or in Saudi Arabia, and you ask yourself why there isn’t more pressure for democratic reform – or Nigeria, and you ask why such vibrant entrepreneurial people are so appallingly governed, you may be very tempted to come up with the same one word answer.