Why oil may be a cursed resource
TEXT OF INTERVIEW
Kai Ryssdal: The price of crude oil fell today, down to almost $66 a barrel. For consumers who live in oil-importing countries that will be welcome news. For citizens of countries that have a lot of oil, countries that don't make quite as much money when oil gets cheaper, falling prices might eventually be welcome news there as well.
Peter Maass talks about oil and its disadvantages in his new book "Crude World." Peter, good to have you with us.
PETER MAASS: Good to be here.
Ryssdal: It occurred to me reading this book that oil is maybe the best example ever of too much of a good thing being a bad thing.
MAASS: Some people refer to it as the resource curse. And what it means is that, indeed, if you have so much oil, and you depend on it for income, for exports, etc., that it can actually hurt your economy. You don't become richer from it, but you become poorer from it. And that actually, instead of becoming more peaceful and prosperous, you actually can become more violent.
Ryssdal: There are countless examples in your book. The best one has to be, I think, Nigeria.
MAASS: Nigeria is really the saddest story of all because it's earned about $400 billion from the oil that it's exported over the last several decades, most of which has gone to the United States. Unfortunately there's about 80 percent of the population that still lives at or below the poverty level, and one out of five Nigerian children die before the age of five. And there's also kind of a low-level insurgency that's going in the Niger Delta, which is where the oil comes from.
Ryssdal: Describe it for me. Tell me what the Delta is like from your trips there.
MAASS: I went into the Delta in a canoe, which is pretty much the only way you can do it. And it's almost kind of a scene from a panel of Bosch or something like that where you're on this creek, and you're smelling oil, and the land along the creek is virtually on fire, because there are like flares coming out of the ground. There are army soldiers kind of ... that are ringed around these oil facilities, which are like kind of isolated fortresses. And on one side of the creek you'll have this kind of beautiful oil facility with lawns and electricity and air conditioning and Wi-Fi connections. Other side of the creek -- I stayed in this one little village -- no running water, no school, no health care, no electricity. The only light that it had, in fact, was from the flare from the oil facility that kind of gave this Martian glow to the place at night.
Ryssdal: There are outliers, of course, and I have to give a shot out to my Norwegian heritage here. I mean they've got North Sea oil, more than they know what to do with, they're a stable democracy with a great social-safety net. How do you explain that?
MAASS: Norway is a wonderful kind of outlier, which shows the lesson that it's best, and in fact, kind of almost imperative to discover democracy before you discover oil. Because Norway had, when it found this oil and natural gas in the North Sea, very solid civic institutions. So that when the oil was found there was a national discussion that was resolved about how do we use this oil, who gets it, what do we do with the revenue. And once this kind of discussion was held and resolved, then the oil money was used in ways that were totally transparent. People could see where the money went, and how it was used, and that it wasn't wasted. And they also made the very smart decision to keep, actually, a lot of this oil money out of the economy, to put it into a reserve fund.
Ryssdal: Is there a way that these countries who are troubled by their oil wealth can recover, can get out of this cycle, unless oil drops in value. And I'm not talking $5 a barrel here, but I'm talking drops in utility value, too. I mean it's so widely used.
MAASS: Well, I think certainly that, if the price of oil drops, if oil becomes kind of less central to the world economy, then the economies that do depend on it, the political systems that do depend on it that have been corrupted by it, will have to begin to reset themselves. But I also think there's some very progressive and interesting movements that are afoot. There's an organization called "Publish What You Pay," which basically is what its name says: Wants countries that have oil and other resources to declare publicly money flows, what the contracts are, how much money, what accounts it goes into, and have the ability for people to look at these accounts so they can know, OK, this is the amount of money we're getting, this is how it's being spent, and it's being spent well.
Ryssdal: Peter Maass is a staff writer for The New York Times Magazine. His latest book is called "Crude World." Peter, thanks a lot for your time.
MAASS: Thank you.