Why oil is the enemy of democracy : By Daniel Hannan

The anti-war crowd is right. It is all about oil - although perhaps not in the way it means. Consider some of the current threats to global stability: Russia's contempt for international norms, Iran's nuclear ambitions, the massacres in Darfur, the descent of South America into Leftist authoritarianism. All these crises are oil-fuelled. The six-fold rise in the price of a barrel, and the commensurate boost it has given to the petro-kleptocracies, is the central fact of our age. Russia is ceasing to be a democracy in any meaningful sense: opposition politicians are harassed, independent media closed, journalists murdered. Almost every contiguous state has felt the force of President Putin's oil diplomacy: Estonia, Moldova, Belarus, Ukraine and, above all, Georgia, which is being asphyxiated by a semi-official blockade. Nor does it stop there. Alexander Litvinenko, let us remember, was a British subject living under the Queen's peace. At best, his murder was an act of terrorism; at worst, an act of war. Yet Vladimir Putin calculates that he can mock us because, as his defence minister cheerfully puts it: "The West keeps buying our energy." Russian revanchism correlates remarkably closely to the price of a barrel. When oil last peaked, at the end of the 1970s, the Red Army poured into Afghanistan. When prices collapsed at the end of the 1980s, so did the USSR. advertisementSimilarly, see how Teheran is throwing its weight about, sponsoring militias in the Balkans, the Caucasus and the old Silk Road khanates, supplying its Lebanese and Palestinian proxies with rockets, orchestrating attacks on our soldiers in Basra, even seizing Servicemen in the Gulf. Meanwhile, the ayatollahs have given up even pretending to collaborate with the international nuclear authorities. Oil again. At the same time, largely unnoticed, South America is retreating from the pluralism of the 1990s into a malignant neo-caudillismo. The modern Latin dictator does not seize power with tanks. Rather, he gets himself more or less fairly elected, then promptly sets about dismantling every check on his power, closing down parliament, nationalising the media, stuffing the judiciary, vitiating the electoral commission, rewriting the constitution. And where has this process gone furthest? In the region's three hydro-carbon exporters: Bolivia, Ecuador and, worst of all, Venezuela, whose foul-mouthed autocrat, Hugo Chávez, has now decreed that foreigners who criticise him will be immediately deported. And, while we're about it, what do you suppose gives the Sudanese government the confidence to defy world opinion in Darfur? Chiefly the fact that its revenue is secure as long as China keeps buying its petrol. An oil strike could well be the worst thing that can happen to a country. By giving the regime an independent income stream, it breaks the link between taxation and representation. States that do not depend on a single natural resource can develop free economies, in which property rights are adjudicated by independent courts. But states where there is one overwhelming source of wealth tend to become oligarchies, whose leaders squabble to get their hands on fabulous riches. There are exceptions. Norway has found a way to put its oil wealth beyond the reach of its politicians, placing its revenues in a special fund. But for every Norway there are a dozen Nigerias - states whose rulers have lost the habit of consulting their citizens. Israelis like to joke that they spent 40 years wandering the wilderness, and managed to wind up in the only part of the Middle East with no oil. Perhaps this is connected to another thing that Israelis are quick to tell you, namely that theirs is the only democracy in the neighbourhood. Even the most quiescent oil producers often turn out to have bought internal stability at the price of foreign instability. It is striking how many suicide bombers come from repressive Gulf monarchies. To borrow a metaphor from chaos theory, these states are drinking order from their environment. Or, in Leninist terms, they are exporting their internal contradictions. All because they have been cursed with unearned wealth. So, a piece of advice to the Scottish Nationalist Party leader, Alex Salmond, who is about to publish his plans for an independence referendum. Stop droning on about the £200 billion of oil revenue that you think a separate Scottish state should have received. Scotland has suffered enough from subventions. Scots, like other Britons, are a restless, mercantile, inventive people. They rose by relying on themselves, not by trusting their leaders to sign back-room deals with multinationals. In any case, North Sea extraction is now definitively dwindling - and not before time.
Have your say Read comments