Refute my statement

[Mark Carolus]

If the people in oil-rich countries got a fair price for that oil, allowing them to live equal or at least comparative lifestyles to those of the 1st world, oil would be to expensive.

[MrCapitalism]

What's a "fair price"?

 

If I make a guess based off the assumption that this 'fair price' is higher than the current price, then I don't think your statement can be refuted. In essence you're saying, "if oil were more expensive, then oil would be more expensive."

 

If the price of oil is too expensive for one party, then obviously it isn't a fair price.

[Mark Carolus]

What's a "fair price"?

 

If I make a guess based off the assumption that this 'fair price' is higher than the current price, then I don't think your statement can be refuted. In essence you're saying, "if oil were more expensive, then oil would be more expensive."

 

If the price of oil is too expensive for one party, then obviously it isn't a fair price.

 

There we go again, your argument is 100% correct, if it weren't for the fact that you are circumventing the main point, that point being "fair price"

I literally stated ( and there can't be much confusion here ) "allowing them to live equal or at least comparative lifestyles to those of the 1st world".

 

Example of this point:

Iraq switched to trading oil in Euro's, which many speculate was the real reason for invading that country ( i believe including Stefan himself ), which would allow them to get a better value for their oil.

 

Also, "If the price of oil is too expensive for one party, then obviously it isn't a fair price." you serious? so what if that is the only resource you have and therefore the only thing you can use to gain capital?

[MrCapitalism]

So what is it about "allowing them to live equal or comparative lifestyles to those in the 1st world" that makes this standard fair? How is that fair for the rest of the world, which now has to pay higher prices?

 

so what if that is the only resource you have and therefore the only thing you can use to gain capital?

 

Then you get less capital.

 

And I do not believe the situation in the middle east is anywhere near a 'free market.'

[ProfessionalTeabagger]

You mean oil rich countries like Norway?

[Carl Green]

Money isn't the only thing that allows you to have comparative lifestyles.

[PatrickC]

Example of this point:

Iraq switched to trading oil in Euro's, which many speculate was the real reason for invading that country ( i believe including Stefan himself ), which would allow them to get a better value for their oil.

Well, actually this had little to do with getting a better price for their oil, but more to do with reducing the power of the US dollar. Oil isn't the commodity of choice here, rather the fiat that you buy it with.

[ThomasDoubts]

Fair value requires a free market, voluntary exchange.  Once you start talking about standards of living, you're making a consequentialist argument.  Who cares or knows how standards of living will be affected by a free oil market; the point is that the oil market is not a free market.  Monopoly via dollar denominated oil is antithical to free exchange.  Funny enough, those who attempt to sell oil in anything other than dollars end up having problems.  Hussien, Gaddafi, Iran, Venezuala.  Of course, this is entirely unrelated...

 

The justification for the status quo is also consequentialist.  If the global economy doesn't need dollars to buy oil, dollar demand contracts.  We can't have the planet sending us back all of the inflation we exported, can we?

 

Your argument fails when you talk of fair value in a market without free exchange.  Fair value and coerced exchange backed by violence are incompatible.

[Dylan Lawrence Moore]

Isn't the US just sitting on more oil than we can ever dream of that companies aren't allowed to touch due to "environmental" regulations?

[tasmlab]

Oil is a pretty fucked up fascistic business.    

 

Our petrodollar status is enforced militarily, the oil companies have bought their oiline security through warfare and claiming rights in the foreign land, the banking sector (and perhaps economy) relies on petrodollar status, the MIC needs the reason to fight and further fleece US taxpayers whilst murdering innocents.  And then it isn't uncommon for the citizens to be ruled by dictators and theocracies in those countries. (mostly speaking of middle east)

 

I'm not sure the 'people' of the country have much to do with it.  The price could be anything and great hordes of the population would still be poor, I think.

 

But Statoil in Norway seems to produce tremendous wealth for the citizens.  Supposedly things are bonkers in North Dakota where menial Mc-Jobs are paying pretty high.

 

I digress, but I do some work in the oil industry.  Some of the most delightful people to work with.

This thread should probably be under 'economics'

[Livemike]

Everyone seems to be talking about "fair value" I'd like to talk about the concepts of "the people" and why they should get any value at all out of the oil.

 

Currently states claim ownership of the oil beneath their territory, allegedly on behalf of "the people".  Clearly however states use the money paid for the oil on themselves and their allies, not "the people" of their nation in general.  So it's easy to argue that States don't deserve the money.  Do "the people" deserve it any more?  To deserve something you must possess a morally relevant quality that causes you to be entitled to that thing and overrides any other morally relevant qualities of other people.  If your employer has $1000 in his hand that he got by consensual trade, and he agreed to pay you $500 for the services you provided, you both deserve $500.  He deserves it because he has the quality of having provided $1000 worth of G&S and only agreeing to pay $500 to you.  You deserve it because you provided $500 worth of G&S.   So what qualities do "the people" have?  They reside within a boundry (called a "border") that also contains the natural resource.  Is that a "morally relevant quality"?

Being inside a state boundary does not mean you helped discover, develop, or otherwise bring into the productive stream a natural resource.  There is no causal connection between living near a resource, even right over it, and that resource being used to satisfy human wants.  So why then should "the people" be entitled to be paid for satisfying said human wants?  Why do people who live in the desert of Saudi Arabia deserve payment for the oil under it but the people in the Kalahari don't? Both contributed exactly the same effort, zero, to making the oil useful.  Now you could argue that we all own the natural world equally, Georgist style, and so everyone is entitled to a share of the value of the raw materials.  But there is no reason why people north of an arbitrary line have more of a right to a particular resource than those south of it.  So "the people" in the sense of the people of a particular nation have no right to be paid for the resource at all. 

[AnarcoB]

Define "people"

[ThoseWhoStayUofM]

 

So what qualities do "the people" have?  They reside within a boundry (called a "border") that also contains the natural resource.  Is that a "morally relevant quality"?

Being inside a state boundary does not mean you helped discover, develop, or otherwise bring into the productive stream a natural resource.  There is no causal connection between living near a resource, even right over it, and that resource being used to satisfy human wants.  So why then should "the people" be entitled to be paid for satisfying said human wants?  Why do people who live in the desert of Saudi Arabia deserve payment for the oil under it but the people in the Kalahari don't? Both contributed exactly the same effort, zero, to making the oil useful.  Now you could argue that we all own the natural world equally, Georgist style, and so everyone is entitled to a share of the value of the raw materials.  But there is no reason why people north of an arbitrary line have more of a right to a particular resource than those south of it.  So "the people" in the sense of the people of a particular nation have no right to be paid for the resource at all. 

This is pretty reasonable.  I mean, it's a common pool resource right?  Just like an aquifer, the oil reserves will run out due to over-extraction.  The resource belongs to whoever wants to extract from it, but extraction rates need to be regulated some how, or else it will be depleted.  "The people" choose to regulate the extraction of this finite resource through government.  It's a perfectly understandable decision.  Some of those people are upset with the way the government is regulating the extraction, but that doesn't mean those people no longer want regulation... They just want different regulation... regulation that benefits themselves at the expense of others.

[waywardvariable]

Generally speaking , people in some "oil rich" countries already have material living standards comparable to 1st world countries (e.g. Saudi Arabia, Kuwait), the exceptions are those that suffer from highly corrupt and/or oppressive political regimes which withhold the material benefits of those natural resources from the general population and/or misallocate capital via command economies. You have to keep in mind that much of the worlds oil production is subsidized by first world net oil consumers (e.g. allocation of U.S. defense resources designed to protect oil supplies), so if you calculate the ACTUAL (i.e. include those "defense subsidies", currency exchange, etc..,) price of oil on the world market it is quite a bit higher than the per barrel exchange price and thus IMHO it's hard to argue that sellers are not getting a "fair price" even given that in some "oil rich" countries the general population isn't receiving the material benefits of it (they can thank their national/local governments for that).

[Lowe D]

The OP reminds me of the movie Syriana.  You guys might check it out, if you haven't.  Here is a clip.

[aeonicentity]

Do you mean nations like Kuwait, Qutar or UAE or Saudi Arabia, or Oman? Those people live better than we do, as long as you don't mind being muslim.

 

There is no such thing as a 'fair' price. Fair to whom? Fair by what objective standards? To a person who the cost of bread is 2 cents, they could have the same standard of living in terms of foodstuffs at 1/100'th of the wages of the average 'first world' person.TBH, if we payed people first world wages in 3rd world countries we would collapse their economies. Their currancy would hyper inflate because there would be insufficent goods to purchase at the wages set.

[Livemike]

This is pretty reasonable.  I mean, it's a common pool resource right?  Just like an aquifer, the oil reserves will run out due to over-extraction.  The resource belongs to whoever wants to extract from it, but extraction rates need to be regulated some how, or else it will be depleted.  "The people" choose to regulate the extraction of this finite resource through government.  It's a perfectly understandable decision.  Some of those people are upset with the way the government is regulating the extraction, but that doesn't mean those people no longer want regulation... They just want different regulation... regulation that benefits themselves at the expense of others.

What does it mean "the people choose to regulate  the extraction of this finite resource through government."?  It means they choose to use force to control the extraction.   But why do they have a right to do that?  I understand why they do it, they want to gain the benefits of controlling the resource without having to personally threaten or inflict violence to do so.  But their desire isn't a justification.  The resource is going to be depleted anyway.  The question is who has the right to say who can deplete it and how fast?   Saying "the people" doesn't tell me why.  Why "the people" meaning the people of a country, as opposed to the people of a smaller area, or the entire world?  Why is the line between who can control and benefit from a resource determined by that result of ancient feuds, double-dealing and battles known as an international border?