ON THE FREEDOM AND OIL CORRELATION

OILY POLITICS

Thomas Friedman has an op-ed titled "The Democracy Recession" that quotes some interesting data on the connection between oil and freedom around the world:

"The term “democratic recession” was coined by Larry Diamond, a Stanford University political scientist, in his new book “The Spirit of Democracy.” And the numbers tell the story. At the end of last year, Freedom House, which tracks democratic trends and elections around the globe, noted that 2007 was by far the worst year for freedom in the world since the end of the cold war. Almost four times as many states — 38 — declined in their freedom scores as improved — 10.

What explains this? A big part of this reversal is being driven by the rise of petro-authoritarianism. I’ve long argued that the price of oil and the pace of freedom operate in an inverse correlation — which I call: “The First Law of Petro-Politics.” As the price of oil goes up, the pace of freedom goes down. As the price of oil goes down, the pace of freedom goes up.

“There are 23 countries in the world that derive at least 60 percent of their exports from oil and gas and not a single one is a real democracy,” explains Diamond. “Russia, Venezuela, Iran and Nigeria are the poster children” for this trend, where leaders grab the oil tap to ensconce themselves in power."

Energy prices have obviously not been the only contributor to these trends in these oil-producing countries.  Each has unique political and social considerations that also have been drivers of their control-oriented domestic politics.  And these things tend to move in cycles, so the pendulum at some point will start to swing the other way.  But it's an important snap-shot of the current affairs of states to keep in mind for now.

Comments

[Alex Tolley]

Certainly there is an association between oil reserves and poorly developed human capital. Perhaps more correctly, between the discovery of oil reserves and states where democracy wqas not were founded before discovery. However I was not aware that the price of oil actually made things worse - this would bode poorly for Russia too. However, there is a facileness in this analysis - how many states have dictatorships and no significant oil reserves, or even other mineral reserves?

If there is a link between oil prices and the state of freedom, then we are in for a very gloomy century as the long term effects of peak oil make themselves felt.