{"id":805,"date":"2009-10-14T08:19:44","date_gmt":"2009-10-14T06:19:44","guid":{"rendered":"http:\/\/www.ofcourseimright.com\/?p=805"},"modified":"2009-10-14T08:19:44","modified_gmt":"2009-10-14T06:19:44","slug":"the-saudis-would-like-some-handouts-please","status":"publish","type":"post","link":"https:\/\/ofcourseimright.com\/?p=805","title":{"rendered":"The Saudis would like some handouts, please."},"content":{"rendered":"

\"Oil\"Here’s a rich idea<\/a> reported by the New York Times<\/a>: Pay oil producers for not producing oil.\u00a0 That’s right.\u00a0 Saudi Arabia wants \u201crich nations\u201d to pay oil producers to help wean themselves from their <\/strong><\/em>dependency on oil.\u00a0 That is- oil exports.\u00a0 It’s just like paying farmers not to plant, right?\u00a0 Wrong.<\/strong> In this case, oil producers still sell what the market demands, it’s just that since the market will be demanding less, OPEC and the like will get less.\u00a0 According to the article, the Saudis have in the past gummed up the works on climate change protocols because of other nations’ refusal to accede to this sort of extortion.<\/p>\n

Do the Saudis have a real problem?\u00a0 Yes.\u00a0 They and other large oil producers like Libya lack a sufficiently diversified economy, such that when oil prices dip, everyone suffers.\u00a0 This is known as Dutch Disease<\/a>, and oil exports are right to be worried about it.\u00a0 Dutch disease happens because the demand of oil alone drives up national currencies, making all other industries in that country uncompetitive by price.<\/p>\n

So here are a few questions:<\/p>\n

    \n
  1. Can oil producers wean themselves off of oil without economic assistance?\u00a0 After all, they’re taking in all of this money.\u00a0 Can’t they use some of it to develop other industries?\u00a0 It seems Dubai has been somewhat successful at this.<\/li>\n
  2. Would economic assistance actually help?\u00a0 If consuming countries gave them more money to compensate for losses of oil revenue, would producers just become dependent on the subsidy?<\/li>\n
  3. Isn’t there a broader picture here surrounding to the West’s relationship to the Middle East?\u00a0 Doesn’t good will count for anything?\u00a0 And don’t we need some of that good will in that part of the world?<\/li>\n<\/ol>\n

    Dutch Disease requires complex solutions.\u00a0 Simply providing a subsidy won’t do the job.\u00a0 In fact, providing a subsidy could in fact prop up the national currency and compound problems.<\/p>\n

    And then there’s the fact that most of us feel as though we’ve been held over a barrel by some of the countries in question, and would like to have done with entanglements in the middle east.\u00a0 Oil or no, however, the people in those countries are not going away.\u00a0 They and we need an equitable way to live together in the future.<\/p>\n","protected":false},"excerpt":{"rendered":"

    Here’s a rich idea reported by the New York Times: Pay oil producers for not producing oil.\u00a0 That’s right.\u00a0 Saudi Arabia wants \u201crich nations\u201d to pay oil producers to help wean themselves from their dependency on oil.\u00a0 That is- oil exports.\u00a0 It’s just like paying farmers not to plant, right?\u00a0 Wrong. In this case, oil … Continue reading “The Saudis would like some handouts, please.”<\/span><\/a><\/p>\n","protected":false},"author":172,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[50,17,4],"tags":[282,497,210,281],"class_list":["post-805","post","type-post","status-publish","format-standard","hentry","category-complexity","category-economics","category-politics","tag-dutch-disease","tag-economics","tag-opec","tag-saudis"],"_links":{"self":[{"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=\/wp\/v2\/posts\/805","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=\/wp\/v2\/users\/172"}],"replies":[{"embeddable":true,"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=805"}],"version-history":[{"count":3,"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=\/wp\/v2\/posts\/805\/revisions"}],"predecessor-version":[{"id":808,"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=\/wp\/v2\/posts\/805\/revisions\/808"}],"wp:attachment":[{"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=805"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=805"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ofcourseimright.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=805"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}